Common use of Drag-Along Rights Clause in Contracts

Drag-Along Rights. (a) If, at any time prior to a Qualified IPO, any Investor (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 4 contracts

Samples: Share Subscription Agreement (ECMOHO LTD), Preferred Share Purchase Agreement (ECMOHO LTD), Preferred Share Purchase Agreement (ECMOHO LTD)

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Drag-Along Rights. (a) If, at any time prior to a Qualified IPOPublic Offering, the Company’s Board of Directors or group of Shareholders that, in the aggregate, owns a majority of the voting power of the Company, receives an offer in a transaction or series of transactions pursuant to which a third party (which, for the avoidance of doubt, shall not include Parent or any Investor (the “Drag-Along Seller”of its Affiliates, or any other Person in which Parent or any of its Affiliates invests or has agreed to make an investment) secures an irrevocable offer proposes to acquire all share capital or assets of the Company Equity Securities of the Company, and, at the closing of such transaction, the holders of the Senior Preferred Shares and any Common Shares that were issued upon the prior conversion of the Senior Preferred Shares shall, in the aggregate, receive cash consideration at the closing of such transaction (not including any cash subject to a holdback or escrow arrangement on the closing date) equal to or greater than 1.5x the Original Purchase Price with respect to all Senior Preferred Shares that are then issued (as adjusted for any stock splits, dividends, combinations, subdivisions, recapitalizations and the like) (a “Drag-Along SaleTransaction) with ), then such Shareholder or group of Shareholders that, in the aggregate, owns a valuation majority of the voting power of the Company of more than US$600,000,000 with any Person (such Personcollectively, a the “Drag-Along PurchaserShareholder”) upon shall have the right, at its option, to require all of the other Shareholders (each such terms other Shareholder, a “Dragged Shareholder,” and conditions as agreed to collectively with any other Dragged Shareholder, the Drag-Along Seller“Dragged Shareholders”), and each Dragged Shareholder hereby agrees, whether such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale Transaction is structured as a sale Transfer of SharesEquity Securities, each Other Investor shall sell merger, consolidation, combination, reorganization, recapitalization, reclassification or otherwise, to the Drag-Along Purchaser Transfer all Shares then held by of such Other Investor Dragged Shareholder’s Equity Securities on substantially the same terms and conditions as are applicable to the Drag-Along Seller, including Shareholder; provided that (i) the same perterms of any Drag-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms Along Transaction may not contemplate any agreement or arrangement in favor of which the Drag-Along Purchaser; provided that Shareholder or any of its Affiliates will receive any consideration, payment or any other thing of value apart from the proceeds from such sale of any Round C Investors shall not consideration to be less than the higher of (i) the Series A Liquidation Amount (as defined paid to all selling Shareholders in the Memorandum sale (including all Dragged Shareholders) other than repayment of indebtedness, reimbursement of customary expenses, payments related to services previously provided and Articles) ordinary course arrangements for services from Management Shareholders consistent with market terms or prior practices, and (ii) the purchase price as stated per share for each Equity Security to be sold in such Drag-Along Transaction shall be determined by allocating consideration pursuant to the offer terms of the Articles of Incorporation. (b) Each Dragged Shareholder shall reasonably cooperate in, and shall take all actions requested by the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); providedShareholder that are reasonably necessary or desirable to consummate, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a mergerTransaction, amalgamation or scheme of arrangement of including: (i) to the Company or other transaction that requires the approval of the Investorsextent applicable, each Investor shall vote voting its respective Shares Equity Securities (or execute executing and deliver delivering any written consents in lieu thereof) in favor of any the Drag-Along Sale Transaction and against all competing transactions, and all actions deemed reasonably necessary by the Drag-Drag- Along Seller Shareholder in connection with the Drag-Along SaleTransaction; (ii) if applicable, taking all actions necessary to cause the Board to approve the Drag-Along Transaction; and (iii) entering into all definitive and ancillary agreements with respect to the proposed Drag-Along Transaction, and against using commercially reasonable efforts to cause the transactions contemplated by such definitive agreements and ancillary agreements to be consummated; provided that (A) such definitive agreements shall contain representations and warranties and indemnity obligations of such Dragged Shareholder only if the Drag-Along Shareholder has also made such representations and warranties, (B) any action representations and warranties or proposal that may preventindemnities given by each of the Dragging Shareholder and the Dragged Shareholders shall be several and not joint, hinder or impede (C) the consummation indemnity obligations thereunder are (x) apportioned pro rata among each of the Drag-Along SaleShareholder and the Dragged Shareholders based on the relative proportion of Common Shares being sold in such Drag-Along Transaction (with Equity Securities convertible or exchangeable into Common Shares considered on an as-converted basis), (y) limited to breaches of fundamental representations and warranties regarding matters such as ownership, capacity and authorization (but under no circumstances will the Shareholders have any post-closing liability for operational matters or Company liabilities other than their pro rata share of any indemnity, escrow or holdback) and (z) limited in respect of each Shareholder to the proceeds received by such Shareholder in such Drag-Along Transaction (except in connection with claims relating to such Shareholder’s fraud), (D) no Dragged Shareholder that is not otherwise an employee of the Company shall be required to agree to any restrictive post-closing covenants (such as non-competition or non-solicitation) other than a customary confidentiality covenant, and (E) each of the Dragging Shareholder and the Dragged Shareholders that are not otherwise employees of the Company will receive the same form of consideration and the same portion of the aggregate consideration that such Shareholders would have received if such aggregate consideration had been distributed by the Company as a Deemed Liquidation Event pursuant to the rights and preferences set forth in the Articles of Incorporation as in effect immediately prior to such Drag-Along Transaction. (c) Without limitation of the foregoing, each Shareholder waives any dissenters, appraisal or other similar rights it may have in connection with any sale of the Company under applicable law that is approved or instituted pursuant to this Section 3.03 and agrees not to assert any claims challenging the validity of such sale of the Company that is approved or instituted pursuant to this Section 3.03. (d) The Drag-Along Seller Shareholder shall provide written notice of a proposed such Drag-Along Sale Transaction to the Other Investors each Dragged Shareholder (a “Drag-Along Sale Transaction Notice”) not later than ten (10) days prior to such the proposed Drag-Along SaleTransaction. The Drag-Along Sale Transaction Notice shall identify the Drag-Along Purchaserproposed Transferee, the per-Ordinary Share consideration for which a transfer Transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along SaleTransaction. Each Other Investor Except as otherwise set forth herein, such Dragged Shareholder shall be required to participate in the Drag-Along Sale Transaction on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale PriceTransaction Notice. (e) The Drag-Along Seller Shareholder shall have a period of 180 thirty (30) days from the date of receipt delivery of the Drag-Along Sale Transaction Notice to enter into a definitive agreement providing for transaction agreements with respect to, and six (6) months from the date of delivery of the Drag-Along Sale Transaction Notice to consummate, the Drag-Along Transaction on the terms and conditions set forth in such Drag-Along Sale Transaction Notice; provided, which however, that such six (6) month period shall be extended by the time necessary (but in no event to exceed three hundred sixty-five (365) days from the date of delivery of the Drag- Along Transaction Notice) to obtain any required approvals of any Regulatory Agency under any applicable laws (the “Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvalsTransaction Period”). If the Drag-Along Seller has Transaction shall not entered into a definitive agreement providing for have been consummated during the Drag-Along Sale within such 180-day period and Transaction Period, the Drag-Along Seller proposes Shareholder shall promptly return any documents in the possession of the Drag-Along Shareholder executed by the Dragged Shareholders in connection with the Drag-Along Transaction, and all the restrictions on Transfer contained in this Agreement or otherwise applicable at such time with respect to any Equity Securities owned by each of the Shareholders shall continue to be in effect. (f) Notwithstanding anything to the contrary in this Section 3.03, there shall be no liability on the part of the Drag-Along Shareholder to the Company or the Dragged Shareholders if the Drag-Along Transaction is not consummated for whatever reason, regardless of whether the Drag-Along Shareholder has delivered a Drag-Along Transaction Notice, except as may be agreed between the applicable parties in a separate written agreement. The decision to effect a Drag-Along Sale after such 180-day period, Transaction is in the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties sole and covenants and enter into such definitive agreements as are customary for transactions of the nature absolute discretion of the Drag-Along SaleShareholder. (g) Notwithstanding anything to the contrary herein, no Dragged Shareholder may Transfer any of its Equity Securities (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to except in connection with the Drag-Along Seller, (iiiTransaction) be required to bear its proportionate share during the period beginning on the date of any escrows, holdbacks or adjustments in respect receipt of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by Transaction Notice and ending at such other shareholder with respect to title in such other shareholder’s equity securitiesearlier time as the Drag-Along Transaction (x) is consummated, (ivy) be required to bear its proportionate share is abandoned or terminated (with notice of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether such abandonment or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested termination having been provided by the Drag-Along SellerShareholder), an investment banking firm selected by or (z) fails to be consummated within the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleTransaction Period.

Appears in 4 contracts

Samples: Preferred Stock Purchase Agreement (TypTap Insurance Group, Inc.), Shareholder Agreement (TypTap Insurance Group, Inc.), Shareholder Agreement (HCI Group, Inc.)

Drag-Along Rights. (a) IfSubject to the provisions of the Articles (including, at any time without limitation, Article 81 of the Articles) and prior to the closing of a Qualified IPO, if (i) any Investor Preferred Shareholders (the “Selling Member”) receives a bona fide offer from and agrees to the terms for the sale of all of its shares with a third party buyer which is not an Affiliate of the Selling Member (the “Buyer”) (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller), and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer holders representing not less than eighty-five percent (85%) of the Drag-Along Purchaser pro rata based on the number of Ordinary then outstanding Existing Preferred Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured voting together as a merger, amalgamation or scheme of arrangement separate class) and holders representing not less than seventy-five percent (75%) of the Company or other transaction that requires then outstanding Series C Shares and the approval holders of at least fifty percent (50%) of the Investorsthen outstanding Ordinary Shares, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of, or consent in writing to, or otherwise agree in writing to sell or transfer all of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller their Shares in connection with the Drag-Along Sale, then the Selling Member may require all other Members to participate in the proposed Drag-Along Sale in accordance with and against any action or proposal that may preventsubject to the conditions set forth in this Section 2.5. However, hinder or impede the consummation Series C Shareholder shall be exempted from being required to participate in the proposed Drag-Along Sale and for the avoidance of doubt, the Series C Shareholder shall not be a Dragged Member. Notwithstanding the foregoing, if such Series C Shareholder votes for the Drag-Along Sale, such Series C Shareholder (as the case may be) shall be deemed to have forfeited rights not to be a Dragged Member for this particular Drag-along Sale only. (db) The Drag-Along Seller shall provide written notice Selling Member may, following execution of a proposed binding agreement with the Buyer (whether conditional or unconditional) for the Drag-Along Sale to (directly or indirectly) of the Other Investors Shares (the “Sale Agreement”), by serving a notice in writing (a “Drag-Along Sale Drag Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions on each of the Drag-Along Sale. Each Other Investor shall be required other Members who are subject to or have agreed to participate in the Drag-Along Sale and who is not a party to the Sale Agreement (each a “Dragged Member”), require each Dragged Member to transfer all of its Shares (the “Dragged Shares”) to the Buyer at the price set out in Section 2.5(c) below on the date indicated in the Drag Notice as being the date of completion of the Sale Agreement (the “Drag Completion Date”), being not less than thirty (30) days after the date of the Drag Notice, and on the terms and subject to the conditions set forth out in this Section 2.5. If the Drag-Along Sale contemplated in the Sale Agreement does not complete, the Drag Notice shall lapse. (c) The price for each Dragged Share shall: (i) be equal to the higher of (A) two point five (2.5) times of the highest Original Purchase Price (as defined in the Articles) and (B) the highest consideration offered for each Share in the Company in the Sale Agreement; (ii) be in the same form as that offered for each Share in the Company in the Sale Agreement; and (iii) be paid at the same time as the consideration is payable under the Sale Agreement (or, if later, on the Drag Completion Date) and shall be subject to the same payment terms. (d) For the avoidance of doubt, the Preferred Shareholders’ rights under this Section 2.5 to transfer the Dragged Shares shall apply regardless of whether the Dragged Shares are of the same class or type of Shares of the Company which the Selling Member proposes to sell. (e) Any sale made by a Dragged Member shall be made on substantially the same terms and conditions as described in the Sale Agreement. However, the Dragged Members shall not be required to make any representation or warranty to the Buyer, other than as to good title to any Dragged Shares, absence of liens with respect to such Dragged Shares, the Dragged Member’s power and authority to undertake the proposed sale, and the validity and enforceability of the Dragged Member’s obligations in connection with it. (f) Each Dragged Member’s indemnification obligations, if any, in connection with the Drag-Along Sale shall only apply with respect to a breach of their own respective representations and warranties and shall be limited (A) to a period of twelve (12) months after consummation of the Drag-Along Sale and (B) to the net sale proceeds received by such Dragged Member in the Drag-Along Sale. The Selling Member shall use its best efforts to ensure that the Buyer in the Drag-Along Sale Notice and is a Person of good reputation acceptable to tender the Preferred Shareholders. (g) Any duly appointed attorney of any Dragged Member, including any director of the Company, may act on such Dragged Member’s behalf to fulfill its Shares. The price and form of consideration payable in such transfer shall be the obligations hereunder on any Drag-Along Sale Pricewhere any such Dragged Member refused to act. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 3 contracts

Samples: Members Agreement, Members Agreement (GDS Holdings LTD), Members Agreement (GDS Holdings LTD)

Drag-Along Rights. (a) IfFor so long as the Stockholders and Management hold, at any time prior in the aggregate, greater than fifty percent (50%) of the outstanding Common Shares and one or more Sponsors agree to enter into a transaction which would result in the Transfer of greater than 50% of the Common Shares to a Qualified IPO, any Investor (the “Dragnon-Along Seller”) secures an irrevocable offer to acquire all share capital or assets of the Company Affiliate third party (a “Drag-Along SaleBuyer”), such Sponsor(s) (the “Selling Stockholders”) with a valuation of may compel each other Stockholder and Management (together, the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along PurchaserStockholders”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed sell its Common Shares by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide delivering written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along PurchaserStockholders stating that such Selling Stockholders wish to exercise their rights under this Section 4.05 with respect to such Transfer, and setting forth the name and address of the Drag-Along Buyer, the per-Ordinary Share consideration for which a transfer is number and class(es) of Common Shares proposed to be made (Transferred, the “Drag-Along Sale Price”) proposed amount and form of the consideration, and all other material terms and conditions offered by the Drag-Along Buyer; provided however, that one or more Sponsors may exercise its drag-along rights hereunder with respect to Sovereign Co-Invest regardless of the amount of Common Shares to be Transferred by such Sponsor or Sponsors and provided further, that in order for one Sponsor to exercise its drag-along rights under this Section 4.05, it must receive the consent of the other Sponsor, such consent being required for so long as such other Sponsor, together with its Affiliates, beneficially owns at least 5% of the outstanding Common Shares. (b) Upon delivery of a Drag-Along Notice, each Drag-Along Stockholder shall be required to Transfer its Pro Rata Portion, on the same terms and conditions (including, without limitation, as to price, time of payment and form of consideration) as agreed by the Selling Stockholders and the Drag-Along Buyer, and shall make to the Drag-Along Buyer representations, warranties, covenants, indemnities and agreements comparable to those made by the Selling Stockholders in connection with the Transfer (other than any non-competition, non-solicitation or similar agreements or covenants that would bind the Drag-Along Stockholder, its Affiliates or any of their respective portfolio companies), and shall agree to the same conditions to the Transfer as the Selling Stockholders agree, it being understood that all such representations, warranties, covenants, indemnities and agreements shall be made by each Selling Stockholder and each Drag-Along Stockholder severally and not jointly and that, the aggregate amount of the liability of the Drag-Along Sale. Each Other Investor Stockholder shall be required not exceed, except with respect to participate in individual representations, warranties, covenants, indemnities and other agreements of the Drag-Along Sale on Stockholder as to the unencumbered title to its Common Shares and the power, authority and legal right to Transfer such Common Shares, such Drag-Along Stockholder’s pro rata share of any such liability, to be determined in accordance with such Drag-Along Stockholder’s portion of the total number of Common Shares included in such Transfer; provided that, in any event the amount of liability of any Drag-Along Stockholder shall not exceed the proceeds such Drag-Along Stockholder received in connection with such Transfer. (c) In the event that any such Transfer is structured as a merger, consolidation, or similar business combination, each Drag-Along Stockholder agrees to (i) vote in favor of the transaction, (ii) take such other action as may be required to effect such transaction (subject to Section 4.05(b)) and (iii) take all action to waive any dissenters, appraisal or other similar rights with respect thereto. (d) Solely for purposes of Section 4.05(c)(i) and in order to secure the performance of each Stockholder’s obligations under Section 4.05(c)(i), each Stockholder hereby irrevocably appoints each other Stockholder that qualifies as a Drag-Along Proxy Holder (as defined below) the attorney-in-fact and proxy of such first Stockholder (with full power of substitution) to vote or provide a written consent with respect to its Common Shares as described in this paragraph if, and only in the event that, such Stockholder fails to vote or provide a written consent with respect to its Common Shares in accordance with the terms of Section 4.05(c)(i) (each such Stockholder, a “Breaching Drag-Along Stockholder”) within three (3) days of a request for such vote or written consent. Upon such failure, the Selling Stockholders shall have and conditions are hereby irrevocably granted a proxy to vote or provide a written consent with respect to each such Breaching Drag-Along Stockholder’s Common Shares for the purposes of taking the actions required by Section 4.05(c)(i) (such Selling Stockholders each and collectively, a “Drag-Along Proxy Holder”). Each Stockholder intends this proxy to be, and it shall be, irrevocable and coupled with an interest, and each Stockholder will take such further action and execute such other instruments as may be necessary to effectuate the intent of this proxy and hereby revoke any proxy previously granted by it with respect to the matters set forth in Section 4.05(c)(i) with respect to the Drag-Along Sale Notice and to tender its SharesCommon Shares owned by such Stockholder. The price and form of consideration payable in such transfer Notwithstanding the foregoing, the conditional proxy granted by this Section 4.05(d) shall be deemed to be revoked upon the Drag-Along Sale Pricetermination of this Article IV in accordance with its terms. (e) The If any Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice Stockholder fails to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable deliver to the Drag-Along SellerBuyer the certificate or certificates evidencing Common Shares to be sold pursuant to this Section 4.05, (iii) be required the Selling Stockholders may, at their option, in addition to bear its proportionate share of any escrowsall other remedies they may have, holdbacks or adjustments in respect of deposit the purchase price (including any promissory note constituting all or indemnification obligations; provided that an Other Investor any portion thereof) for such Common Shares with any national bank or trust company having combined capital, surplus and undivided profits in excess of $100 million (the “Escrow Agent”), and the Company shall only be obligated to indemnify any other Person in connection with cancel on its books the certificate or certificates representing such Common Shares and thereupon all of such Drag-Along Sale severally; providedStockholder’s rights in and to such Common Shares shall terminate. Thereafter, further, that no Other Investor shall be obligated upon delivery to indemnify any other shareholder for any breach or misrepresentation the Company by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along SellerStockholder of the certificate or certificates evidencing such Common Shares (duly endorsed, an investment banking firm selected by or with stock powers duly endorsed, for transfer, with signature guaranteed, free and clear of any liens or encumbrances, and with any stock transfer tax stamps affixed), the Selling Stockholders shall instruct the Escrow Agent to deliver the purchase price (without any interest from the date of the closing to the date of such delivery, any such interest to accrue to the Company) to such Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleStockholder.

Appears in 3 contracts

Samples: Stockholders’ Agreement (Sabre Corp), Stockholders’ Agreement (Sabre Corp), Stockholders’ Agreement (Sabre Corp)

Drag-Along Rights. (a) IfMSG shall have the right, at any time prior but not the obligation, to cause a Qualified IPO, any Investor (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets Sale of the Company in accordance with the terms of this Section 6.5 (a an Drag-Along Approved Sale”) with after: (i) the fifth anniversary of the date of this Agreement; or (ii) in the event of a valuation Principal Post-Year 5 Put, Principal Pre-Year 5 CoC Put or Principal Post-Year 5 CoC Put; provided, however, that in the event MSG is required pursuant to Section 6.3(a)(ii) to give the Principals a right of first offer in order to Transfer its Interests pursuant to Section 6.3, then MSG may not exercise its rights under this Section 6.5 unless the ROFO Period shall have expired without the ROFO Party(ies) exercising their rights to purchase all of MSG’s Offered Securities. MSG shall initiate such action by giving written notice (an “Approved Sale Notice”) to the Company and the Qualified Principals. If MSG delivers an Approved Sale Notice, (x) MSG shall be authorized to initiate a process to seek a Sale of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote for which definitive documents are entered into within 270 days of the other Investors delivery of such Approved Sale Notice and a majority vote that is consummated within 360 days after delivery of the Founders, each other Investor such Approved Sale Notice (an “Other InvestorApproved Sale Period”) agreesand to direct and control all decisions in connection therewith (including the hiring or termination of any investment bank and/or other professional advisers and making all decisions regarding valuation and consideration) and (y) the Company shall participate in, and cooperate in good faith with, such process, in each case as requested by MSG; provided, however, that for so long as the Qualified Percentage Share is at least 21%, (i) unless otherwise agreed by the request Principal Base any such investment bank will be a mutually agreed-upon nationally recognized investment bank or, if no investment bank can be mutually agreed upon by both MSG and the Principal Base within 30 days after the date of the Drag-Along SellerApproved Sale Notice, then either of them may request the AAA to participate select such investment bank from a list of four nationally recognized investment banks (two identified by MSG and two by the Principal Base) submitted to the AAA, and (ii) MSG shall conduct any such process in regular consultation with the Principals and will keep them reasonably and regularly apprised of all material developments related to any such Drag-Along Sale as set forth in this Section 9.1process. (b) If In the Drag-Along event of an Approved Sale, (i) each Member and Rollover Holdco Member will waive any dissenter’s rights and other similar rights and (ii) if the Approved Sale is structured as a sale of Sharessecurities, each Other Investor Member will agree to sell such Member’s Interests on the terms and conditions of the Approved Sale (or, if requested by MSG, each Rollover Holdco Member will agree to sell such Rollover Holdco Member’s Rollover Holdco Interests on the terms and conditions of the Approved Sale). Each Member and Rollover Holdco Member will take all reasonably necessary actions as directed by MSG in connection with the consummation of any Approved Sale, including by executing the applicable transaction agreements in accordance with Section 6.5(d); provided, however, that each Rollover Holdco Member will also execute (without duplication) such transaction agreements as if such Rollover Holdco Member directly held the Attributable Interests that correspond to such Rollover Holdco Member’s Rollover Holdco Interests. (c) In an Approved Sale, the aggregate consideration payable upon consummation of such Approved Sale to all Members in respect of their Interests (the “Aggregate Consideration”) shall sell be apportioned to and paid to the Dragholders of Interests in the Approved Sale based on the Distribution Priorities; provided, however, that (1) all holders of Preferred Units shall be entitled to receive the Stated Preferred Value in cash in respect of such Preferred Units, and (2) if such Approved Sale is structured to include a sale by the Rollover Holdco Members of their Rollover Holdco Interests, then the Aggregate Consideration payable to all Members (other than Rollover Holdco) in respect of their Interests shall be apportioned and paid based on the Distribution Priorities and the Aggregate Consideration payable to any Rollover Holdco Member in respect of his, her or its Rollover Holdco Interests shall be equal to the portion of the amount to which Rollover Holdco is entitled based on the Distribution Priorities to which such Rollover Holdco Member is entitled on dissolution of the Rollover Holdco pursuant to the Rollover Holdco LLCA. (d) Notwithstanding the foregoing but subject to Section 6.5(e): (i) neither MSG nor any of its Affiliates may be the purchaser in an Approved Sale; (ii) the Company’s costs and expenses (including reasonable documented out-Along Purchaser all Shares then held of-pocket costs and expenses incurred by MSG in connection with the Approved Sale and the reasonable documented out-of-pocket costs and expenses (not to exceed $200,000 in the aggregate) incurred by the Principals in connection with the Approved Sale), purchase price adjustments, escrow amounts, purchase price holdbacks, indemnity obligations and other similar items, shall be deemed to reduce (or increase, as the case may be, i.e., in the case of a purchase price adjustment increase or an indemnity payment in favor of the Members) the Aggregate Consideration for purposes of determining the apportionment in accordance with the Distribution Priorities (except that indemnification obligations that relate solely to a particular Member or Rollover Holdco Member, such as indemnification with respect to representations and warranties made by a Member or Rollover Holdco Member with respect to such Member or Rollover Holdco Member or covenants made by such Other Investor on Member or Rollover Holdco Member, shall be borne only by such Member or Rollover Holdco Member and shall not be deemed to reduce the Aggregate Consideration); (iii) non-cash consideration (including debt and equity securities) shall be allocated among the Interests Transferred in the Approved Sale in accordance with the Distribution Priorities after all cash consideration is so allocated (and if such Approved Sale is structured to include a sale by the Rollover Holdco Members of their Rollover Holdco Interests, then the non-cash consideration that is so allocated to Rollover Holdco will be further allocated to the Rollover Holdco Members in the manner set forth in clause (2) of the proviso to Section 6.5(c)); provided, however, that (x) any Member or Rollover Holdco Member entitled to receive cash may elect to receive non-cash consideration of an equal value in lieu of cash, (y) MSG and its Affiliates may only elect to take non-cash consideration to the extent the other Members are offered the opportunity to take non-cash consideration in the same proportion that the non-cash consideration to be received by MSG and its Affiliates bears to the total consideration to be received by MSG and its Affiliates, and (z) in the event of an Approved Sale initiated in connection with a Principal Post-Year 5 Put, Principal Pre-Year 5 CoC Put or Principal Post-Year 5 CoC Put pursuant to clause (ii) of 6.5(a), except as may otherwise be agreed by the Principal exercising such Put, the form of non-cash consideration in such an Approved Sale payable to such Principal’s Principal Rollover Holdco Group shall be limited to (1) equity securities that are (A) either registered under Section 12(b) or 12(g) of the Exchange Act (and it being agreed that MSG shall pursue and request that the acquiror effect the registration of such equity securities to allow all such Persons receiving such equity securities two periods of 30 consecutive days to trade such equity securities within the first 180 days of issuance (so long as one of such 30-day periods falls within the first 120 days of issuance)) or if not registered, are the same as those received by MSG (in the same proportion as MSG) and are subject to the same terms and conditions as the equity securities issued to MSG, (B) listed for trading on a U.S. national securities exchange (in the case of a foreign issuer, the equity securities listed on such exchange shall have an average float and trading volume that is at least 90% of the average float and average daily trading volume of MSG in the 90 days immediately preceding the announcement of such Approved Sale and shall not consist of American Depositary Receipts or similar instruments), (C) freely tradeable (subject to compliance with applicable securities laws), duly authorized, validly issued, fully paid and non-assessable, not subject to any preemptive or other similar rights and issued free and clear of any Liens (other than Liens under applicable securities laws and this Agreement) and (D) in the case of the equity securities of a foreign issuer, MSG takes at least one third of the consideration it receives in the Approved Sale in the form of such equity securities, (2) a promissory note or similar obligation, or contingent obligations, that are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, as those received by MSG (and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum same proportion as MSG) and Articles) or (ii) the purchase price as stated mature and are payable in the offer immediately available funds within one year of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Approved Sale. , (d3) The Drag-Along Seller shall provide written notice a TAO Promissory Note that is due and payable within one year of a proposed Drag-Along Sale the consummation of the Approved Sale, or (4) any combination of the foregoing (and to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior extent any consideration payable to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify Principal’s Principal Rollover Holdco Group does not satisfy the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and preceding clauses (1)-(4), then such Principal’s Principal Rollover Holdco Group shall instead receive substitute consideration that either satisfies such conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and or is a form of consideration payable otherwise available to the Company, MSG or MSG Company Successor under such Put pursuant to Section 6.6(h) or Section 6.6(i), as applicable, with the form of such substitute consideration to be determined by MSG and having a value equal to the Fair Market Value (determined mutatis mutandis in the same manner that Fair Market Value is determined pursuant to Section 6.8) of such transfer non-compliant consideration); and (iv) cash amounts paid to the Members following the applicable closing (i.e., purchase price adjustment increases, earn-out payments, escrow and holdback releases, and similar items) shall be allocated among the Drag-Along Sale PriceInterests of the Members as such amounts would have been allocated at the applicable closing had such amounts been included in the Aggregate Consideration and apportioned in accordance with the Distribution Priorities. (e) The Drag-Along Seller shall have a period of 180 days from Notwithstanding anything to the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth contrary contained in this Section 9.1(e). (f) In 6.5, in connection with a Drag-Along an Approved Sale, each Other Investor shall : (i) no Member or Rollover Holdco Member shall be required to make such representations, warranties any representation or warranty that is not the same as or equivalent to those made by all other Members and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along SaleRollover Holdco Members, (ii) benefit from each Member and Rollover Holdco Member shall only be subject required to all of the same provisions of the definitive agreements as are applicable make representations and warranties on a several and not joint basis (other than with respect to claims against an escrow, which may be on a joint and several basis) with respect to the Drag-Along SellerCompany and its Subsidiaries (and, in the case of representations and warranties by the Rollover Holdco Members, with respect to Rollover Holdco) that are made by all other Members and Rollover Holdco Members, (iii) other than in the case of fraud, no Member or Rollover Holdco Member shall be required to bear its proportionate share of any escrows, holdbacks incur indemnification or adjustments similar obligations in respect the aggregate in excess of the purchase price lesser of (1) the proceeds actually received by such Member or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person Rollover Holdco Member in connection with such Drag-Along Sale severally; providedApproved Sale, further, that no Other Investor shall be obligated to indemnify and (2) the pro rata share of such Member or Rollover Holdco Member of any other shareholder for any breach or misrepresentation by such other shareholder with respect to title “cap” on indemnification obligations of the Members and Rollover Holdco Members in such other shareholder’s equity securitiesApproved Sale, (iv) any indemnification or similar obligation in excess of an escrow shall be required to bear its proportionate share on a several, and not joint, basis (other than in respect of the costs indemnification or similar obligations in respect of representations and expenses incurred by the Company warranties made by, or covenants of, such Member or Rollover Holdco Member), except that any indemnification or similar obligation of any member of a Principal Rollover Holdco Group shall be on a joint and the Investors in connection several basis with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Companyother members of such Principal Rollover Holdco Group, and (v) each Member and Rollover Holdco Member shall remain subject to any non-competition or non-solicitation arrangement or similar restrictive covenant existing as of the extent permitted by applicable Lawdate of such Approved Sale in accordance with the terms thereof as then in effect (it being understood that the non-competition obligations of the Principals pursuant to Section 4.6(a) shall terminate in accordance with the terms thereof); provided, not exercise however, that in no event shall a Member or Rollover Holdco Member be obligated to enter into new restrictive covenants or extensions of the existing restrictive covenants, regardless of what any dissenters’ other Members or appraisal rights Rollover Holdco Members may agree to which they may be entitled in connection with a Drag-Along Saleaccept.

Appears in 3 contracts

Samples: Limited Liability Company Agreement (MSG Entertainment Spinco, Inc.), Limited Liability Company Agreement (MSG Entertainment Spinco, Inc.), Limited Liability Company Agreement (Madison Square Garden Co)

Drag-Along Rights. (a) IfUntil the expiration of the Initial Share Holding Period, if any Shareholder or Shareholders holding at any least a majority of the aggregate outstanding shares of Common Stock (collectively, the “Majority Shareholders”) receive an offer from a Person other than an Affiliate of such Shareholder or Shareholders (a “Drag-Along Buyer”) to purchase or otherwise acquire at least a majority of the aggregate outstanding shares of Common Stock and the Majority Shareholders propose to accept such offer, then each other Shareholder (collectively, the “Drag-Along Shareholders”) shall, if requested by the Majority Shareholders in accordance with this Section 2.5, Transfer to such Drag Along Buyer, subject to Section 2.5(b), on the terms of the offer to be accepted by the Majority Shareholders, including, without limitation, time prior of payment, form of consideration and adjustments to purchase price, the number of shares of Common Stock equal to the number of shares of Common Stock owned by it multiplied by the percentage of the then-outstanding shares of Common Stock to which the Drag-Along Buyer’s offer is applicable. For purposes of clarification, this Section 2.5 shall not apply to securities received by a Shareholder pursuant to a Qualified IPO, any Investor transaction contemplated by Section 2.4 or a prior exercise of this Section 2.5. (b) The Majority Shareholders will give notice (the “Drag-Along SellerNotice”) secures an irrevocable offer to acquire all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and Shareholders of any proposed Transfer giving rise to the rights of the Majority Shareholders set forth in Section 2.5(a) no later than fifteen (15) Business Days prior to the proposed closing date for such proposed Transfer. The Drag-Along Sale is agreed by a majority vote Notice will set forth the number of shares of Common Stock proposed to be so Transferred, the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request name of the Drag-Along SellerBuyer, the proposed amount and form of consideration (and if such consideration consists in part or in whole of property other than cash, the Majority Shareholders will provide such information, to participate in the extent reasonably available to the Majority Shareholders, relating to such Dragnon-Along Sale cash consideration as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale Shareholders together may reasonably request in order to evaluate such non-cash consideration), the number of Sharesshares of Common Stock sought and the other terms and conditions of the offer. Each Drag-Along Shareholder shall agree to make the same representations, warranties, covenants, indemnities and agreements that the Majority Shareholders agree to make (except that, in the case of representations, warranties, conditions, covenants, indemnities and agreements pertaining specifically to any of the Majority Shareholders, each Other Investor Drag-Along Shareholder shall sell make the comparable representations, warranties, covenants, indemnities and agreements and shall agree to comparable conditions, in each case to the extent applicable and pertaining specifically to itself and only to itself); provided, that all representations, warranties, covenants, indemnities and agreements (other than those referred to in the immediately preceding exception) shall be made by each Majority Shareholder and each Drag-Along Shareholder severally and not jointly and that any liability of the Majority Shareholders and the Drag-Along Purchaser all Shares then held Shareholders thereunder shall be borne by such Other Investor each of them on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on basis determined according to the number of Ordinary Shares held shares of Common Stock sold by such Round C Investors (on an as-converted basis)each of them; and provided, further, that except with respect to in no event shall any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a indemnification obligation of any Drag-Along Purchaser for an amount greater than the proceeds from Shareholder in connection with such sale. (c) If the transaction exceed such Drag-Along Sale Shareholder’s proceeds of such transaction. In the event that any such Transfer is structured as a merger, amalgamation consolidation or scheme of arrangement of the Company or other transaction that requires the approval of the Investorssimilar business combination, each Investor shall Drag-Along Shareholder agrees to vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of the transaction and to take all action to waive any dissenters, appraisal or other similar rights. Each Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration Shareholder will be responsible for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses of such Transfer (except for any costs incurred by solely for the Company and the Investors in connection with the proposed transaction (whether or not consummated)benefit of individual shareholders, including all attorney’s other than reasonable attorneys’ fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by of the Drag-Along SellerShareholders, an investment banking firm selected by which shall be included in the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), costs of such Transfer) to the extent not paid or reimbursed by the Company, the Drag-Along Buyer or another Person (other than the Majority Shareholders). The Majority Shareholders shall be entitled to estimate each Drag-Along Shareholder’s proportionate share of such costs and to withhold such amounts from payments to be made to such Drag-Along Shareholder at the time of closing of such Transfer; provided, that (i) such estimate shall not preclude the Majority Shareholders from recovering additional amounts from any Drag-Along Shareholder in respect of such Drag-Along Shareholder’s proportionate share of such costs and (vii) the Majority Shareholders shall reimburse each Drag-Along Shareholder to the extent permitted actual amounts are ultimately less than the estimated amounts paid by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a such Drag-Along SaleShareholder or any such amounts are paid by the Company, the Drag-Along Buyer or another Person (other than the Majority Shareholders).

Appears in 3 contracts

Samples: Shareholders’ Agreement (Blackstone Capital Partners (Cayman) LTD 1), Shareholder Agreements (Celanese CORP), Shareholders’ Agreement (Celanese CORP)

Drag-Along Rights. (a) If, If at any time prior to any Existing Member or group of Existing Members holding at least a Qualified IPOmajority of the outstanding Ordinary Shares (assuming the conversion of all Preference Shares into Ordinary Shares) (collectively, any Investor (the “Drag-Along SellerDragging Members”) secures an irrevocable offer determine to acquire Transfer or cause to be Transferred, in any single arm’s-length transaction or series of related arm’s-length transactions, Ordinary Shares representing all share capital or assets of the Company then-issued and outstanding Ordinary Shares (assuming the conversion of all Preference Shares into Ordinary Shares) then held by the Existing Members to one or more Persons who are unaffiliated bona fide third-party purchasers (a “Drag-Along Sale”) with a valuation of ), then the Company of more than US$600,000,000 with any Person Dragging Members may elect to require all other Members (such Person, a the Drag-Along PurchaserDragged Members”) upon such terms and conditions as agreed to with the Drag-Along Sellerto, and the Dragged Members shall, (i) if such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Ordinary Shares, each Other Investor shall sell Transfer, or caused to the Drag-Along Purchaser all Shares then held by be Transferred, to such Other Investor on the same terms and conditions as are applicable to the Drag-Along SellerPerson, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection concurrently with the Drag-Along Sale, and against any action Preference Shares or proposal that may prevent, hinder or impede the consummation Ordinary Shares representing all of the Ordinary Shares then held by the Dragged Members (in the case of Preference Shares, assuming the conversion of all Preference Shares into Ordinary Shares) or (ii) if such Transfer is structured as a merger, consolidation or sale of all or substantially all of the assets of the Company, to vote in favor thereof, and otherwise to consent to and raise no objection to such Drag-Along Sale. (d) The Drag-Along Seller , and the Dragged Members shall provide written notice waive dissenters’ rights, appraisal rights or similar rights, if any, which the Dragged Members may have in connection therewith; provided that upon the consummation of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed any Drag-Along Sale. The Drag-Along Sale Notice , (y) before any distribution or payment shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the to any Dragging Members in connection with such Drag-Along Sale. Each Other Investor , each Dragged Member that holds Preference Shares shall be required entitled to participate in receive the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and Payment, for each Preference Share it holds that is to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth Transferred in such Drag-Along Sale Notice, which in accordance with the Memorandum and (z) if such Drag-Along Sale is entered into prior to the three year anniversary of the Closing, then the consideration payable to each Dragged Member that holds Preference Shares shall be promptly consummatedpayable either (i) solely in cash or Liquid Securities, subject or (ii) solely to fulfilling any closing conditions and obtaining any required regulatory approvals. If the extent holders of Ordinary Shares are receiving securities, other than Liquid Securities, in such Drag-Along Seller has not entered into a definitive agreement providing Sale, then each holder of Preference Shares shall have the option of receiving non-Liquid Securities of either the same class received by holders of Ordinary Shares or in the form of Acceptable Securities. For greater certainty, under no circumstances shall any Affiliate of the Company be considered an unaffiliated bona fide third-party purchaser for purposes of this Section 7. (b) The Dragging Members may exercise their drag-along rights pursuant hereto by delivering to each Dragged Member and the Company, at least twenty (20) days in advance of the anticipated closing date for the Drag-Along Sale within such 180-day period and Sale, a written notice (the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period“Drag Notice”), the Drag-Along Seller which shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make the number of Ordinary Shares the Dragging Members proposed to be sold in such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from the name and be subject to all address of the same provisions proposed Transferee in such Drag-Along Sale, (iii) the material terms and conditions of such proposed Drag-Along Sale (including the per Ordinary Share purchase price or a reasonable estimate of the definitive maximum and minimum per Ordinary Share purchase price) and (iv) the proposed effective date of the proposed Drag-Along Sale. The Drag Notice shall also specify the number of Ordinary Shares required to be Transferred by the Dragged Member. (c) Prior to or in connection with the closing of any such proposed Drag-Along Sale, each Dragged Member shall take, or cause to be taken, all commercially reasonable actions, and do, or cause to be done, all things commercially reasonable or advisable to consummate or make effective such Drag-Along Sale, including (i) together with the proposed purchaser or purchasers, execute any purchase agreement or other certificates, instruments and other agreement required to consummate and make effective such proposed Drag-Along Sale and (ii) using commercially reasonable efforts to obtain all necessary consents from third parties and take such other actions as may be necessary to effectuate the intent of the foregoing so long as such Dragging Members execute the same agreements and other documents on the same terms; provided that: (i) a Dragged Member shall not be required to provide representations, warranties, covenants, or agreements other than those individual representations, warranties covenants, or agreements (so long as are applicable such Dragging Members agree to do the same) related to such Dragged Member’s (A) ownership of and title to the shares it is transferring in such Drag-Along Sale, (B) organization, (C) authority to enter in the Drag-Along Seller, Sale and (iiiD) be required conflicts and consents related to bear its proportionate share of such Drag-Along Sale; (ii) any escrows, holdbacks or adjustments in respect of indemnity given by the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated Dragging Members to indemnify any other Person the purchaser in connection with such Drag-Along Sale severally; provided, further, that no Other Investor applicable to liabilities not specific to the Dragging Members shall be obligated apportioned among the Dragging Members and Dragged Members (as the case may be) according to indemnify the consideration received by each Dragging Member and Dragged Member and shall not exceed the lesser of (A) such Dragging Member’s or Dragged Member’s (as the case may be) pro rata portion of any other shareholder such liability, to be determined in accordance with such Dragging Member’s or Dragged Member’s (as the case may be) portion of the total value for any breach his, her or misrepresentation by such other shareholder with respect to title its shares included in such other shareholderDrag-Along Sale or (B) such Dragging Member’s equity securities, or Dragged Member’s (ivas the case may be) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by proceeds from the Drag-Along SellerSale; (iii) other than a customary confidentiality covenant, an investment banking firm selected a Dragged Member shall not be obligated to enter into any non-compete, non-solicit or other post-closing covenant that restricts its activities in any way; and (iv) a Dragged Member shall not be responsible for breaches of representations, warranties, covenants, or agreements made by any other seller in such Drag-Along Sale with respect to such other seller. Subject to clauses (i) through (iv) above, at the closing of any such proposed Drag-Along Sale, the Dragged Members shall deliver to the proposed purchaser or purchasers (x) such certificates and other instruments of transfer as shall be reasonably requested by the proposed purchaser or purchasers with respect to the Ordinary Shares to be Transferred, against receipt of the purchase price therefor in such Drag- Along Sale (so long as such Dragging Members agree to do the same) and (y) the Dragged Member’s Preference Shares or Ordinary Shares, free and clear of any liens (so long as such Dragging Members agree to do the same). At the closing of any proposed Drag-Along Sale, the proposed purchaser or purchasers shall deliver payment (in full in immediately available funds) for the shares purchased by such proposed purchaser or purchasers. (d) In the event that the Drag-Along Seller Sale is effectuated through a business combination (whether by way of merger, recapitalization or otherwise) or asset sale, the members shall use their commercially reasonable efforts to take, or cause to be taken, all commercially reasonable action, and engagedto do, or cause to be done, all things commercially reasonable or advisable to consummate and make effective the business combination. (e) There shall be no liability on customary terms (including customary indemnification from the Company))part of the Dragging Members, the Board of Directors or the Company to the extent Dragged Members or any of their respective Affiliates if any Drag-Along Sale is not paid by consummated for whatever reason. For the Companyavoidance of doubt, and (v) the determination of whether to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with effect a Drag-Along Sale shall be in the sole and absolute discretion of the Dragging Members. (f) If more than 90 days elapse from the date of delivery of the Drag Notice without the consummation of such Drag-Along Sale, the members shall be released from their obligations with respect to such Drag-Along Sale and the provisions of this Section 7 shall again apply to any future Transfers that otherwise come within its terms.

Appears in 3 contracts

Samples: Subscription Agreement (Michael Kors Holdings LTD), Restructuring Agreement (Michael Kors Holdings LTD), Shareholders Agreement (Michael Kors Holdings LTD)

Drag-Along Rights. (a) IfSo long as the Francisco Partners Group beneficially owns (as determined pursuant to Rule 13d-3 promulgated under the Exchange Act) 10% or more of the outstanding Common Shares and the Xxxxxxxx Group does not beneficially own (as determined pursuant to Rule 13d-3 promulgated under the Exchange Act) a greater number of Common Shares than that beneficially owned (as determined pursuant to Rule 13d-3 promulgated under the Exchange Act) by the Francisco Partners Group, at any time prior to a Qualified IPOif holders of 50.1% of the outstanding Common Shares, any Investor including the Francisco Partners Group (the “Accepting Shareholders”), agree (individually or in the aggregate) to enter into, or vote to approve, a transaction, or series of transactions, with a non-affiliated third party (the “Third Party Buyer”) which would result in a Change of Control Event (“Drag-Along SellerTransaction) secures an irrevocable offer ), each Shareholder other than the Accepting Shareholders (“Non-Accepting Shareholders”), shall be obliged to acquire all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with approve the Drag-Along Seller, Transaction and such Drag-Along Sale is agreed by a majority vote of to take all necessary action to cause the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of Corporation to consummate the Drag-Along SellerTransaction, including, without limitation, taking each of the following actions, as applicable (i) vote or take such other action necessary to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If approve the Drag-Along Sale Transaction (or any portion thereof), and execute and deliver all documents and instruments to give effect to such acceptance, (ii) if the Drag-Along Transaction is structured to include a tender offer, tender the Common Shares owned by the Non-Accepting Shareholders into the Drag-Along Transaction, and (iii) if the Drag-Along Transaction is structured as a sale of Sharesstock, each Other Investor shall sell or transfer up to that percentage of Common Shares equal to the Drag-Along Purchaser all percentage of the Common Shares then held by such Other Investor on the same terms and conditions as Accepting Shareholders which are applicable being transferred to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of SharesThird Party Buyer, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from and deliver all documents and instruments to give effect to such sale of any Round C Investors or transfer. For greater certainty, the Non-Accepting Shareholders shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect required to take any liability incurred by such Other Investor individually, such Other Investor shall not be liable actions to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede further the consummation of the Drag-Along SaleTransaction pursuant to this Section 6.4 unless and until the holders of 50.1% of the outstanding Common Shares have irrevocably agreed to enter into, have entered into, or have voted to approve the Drag Along Transaction. (db) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price.Transaction shall: (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such not provide a Collateral Benefit to any Shareholder or any Affiliate thereof; (ii) require the Non-Accepting Shareholder to only transfer up to that percentage of Common Shares equal to the percentage of the Common Shares held by the Accepting Shareholders which are being transferred to the Third Party Buyer; and (iii) provide that each Non-Accepting Shareholder’s liability for representations, warranties and covenants and enter into indemnities provided to the Third Party shall be, in any event, limited to such definitive agreements as are customary for transactions Non-Accepting Shareholder’s pro rata portion of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification proceeds received from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Saletransaction.

Appears in 3 contracts

Samples: Shareholders Agreement (Matthews Terence H), Shareholders Agreement (Francisco Partners GP II Management, LLC), Shareholders Agreement (Mitel Networks Corp)

Drag-Along Rights. (a) If, at any time prior to a Qualified IPO, any Investor If the Carlyle Holders and the WCAS Holders collectively (the "SELLING HOLDERS" for the purposes of this Section 5) propose a Transfer to any Person (collectively, a "DRAG-ALONG TRANSFEREE") in a bona fide arm's-length transaction or series of transactions (including by way of a purchase agreement, tender offer, merger or other business combination transaction or otherwise) of an amount of Interests equal to 51% or more in the aggregate of the then outstanding Interests on the date thereof (an "EXIT SALE" for the purposes of this Section 5), then the Selling Holders may elect to require each (but not fewer than each) Other Equityholder to Transfer, as a part of the Exit Sale to such Drag-Along Seller”) secures an irrevocable offer Transferee at the purchase price and upon the other terms and subject to acquire all share capital or assets the conditions of the Company Exit Sale (a “Drag-Along Sale”) with a valuation all of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with which shall be set forth in the Drag-Along SellerNotice), that number of Interests as is equal to the product of (i) a fraction, the numerator of which is the number of Interests proposed to be sold by the Selling Holders and such Drag-Along Sale the denominator of which is agreed by a majority vote the aggregate number of Interests owned as of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request date of the Drag-Along Seller, to participate in Notice by the Selling Holders and (ii) the number of Interests owned by such Other Equityholder as of the date of the Drag-Along Sale as set forth in this Section 9.1Notice. (b) If The rights set forth in Section 5(a) shall be exercised by giving written notice (the "DRAG-ALONG NOTICE") to each Other Equityholder, at least twenty (20) Business Days prior to the date on which the Selling Holders expect to consummate the Transfer giving rise to such Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to Right. In the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided event that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and and/or conditions set forth in the Drag-Along Sale Notice are thereafter amended in any respect, the Selling Holders shall give written notice (an "AMENDED DRAG-ALONG NOTICE") of the amended terms and conditions of the proposed Transfer to tender its Shareseach Other Equityholder. The price and form of consideration payable in such transfer shall be the Each Drag-Along Sale Price. (e) The Notice and Amended Drag-Along Seller Notice shall have a period of 180 days from set forth: (i) the date of receipt name of the Drag-Along Sale Notice Transferee and the amount of Interests proposed to enter into a definitive agreement providing for be purchased by such Drag-Along Transferee, (ii) the proposed amount and form of consideration and terms and conditions of payment offered by the Drag-Along Sale on Transferee and a summary of any other material terms pertaining to the Transfer, (iii) the number of Interests that such Other Equityholder is required to sell in such Transfer and (iv) all other material terms and conditions set forth in of the proposed Transfer. After the delivery of such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject such Selling Holder will provide each of the Other Equityholders with any additional information as is reasonably requested with respect to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e)Transfer. (fc) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions All Transfers of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable Interests to the Drag-Along SellerTransferee pursuant to this Section 5 shall be consummated contemporaneously at the offices of the Company, unless the Selling Holder(s) elect otherwise, on the later of (iiii) a Business Day not less than twenty (20) or more than sixty (60) days after the Drag-Along Notice is delivered to the Parties or (ii) the fifth (5th) Business Day following receipt of all material Governmental Approvals, or at such other time and/or place as the parties to such Transfers may agree. The delivery of certificates (if any) or other instruments evidencing such Interests shall be required to bear its proportionate share of any escrowsmade on such date, holdbacks or adjustments in respect against payment of the purchase price for such Interests, duly endorsed for Transfer or with duly executed stock powers or similar instruments, or such other instrument of Transfer of such Interests as may be reasonably requested by the Selling Holders and the Company, with all stock transfer taxes paid and stamps affixed. Additionally, each Equityholder shall comply with any other conditions to closing generally applicable to such Selling Holders and all Other Equityholders selling Interests in such transaction. Each Other Equityholder shall receive the same amount and form of consideration received by the Selling Holder per each Interest. To the extent that the Parties are to provide any indemnification obligations; provided that an or otherwise assume any other post-closing liabilities, the Selling Holders and all Other Investor Equityholders selling Interests in a transaction under this Section 5 shall do so severally and not jointly (and on a pro rata basis in accordance with their Interests being sold) and their respective potential liability thereunder shall not exceed the proceeds received, subject to customary exceptions in excess of such limits. Furthermore, each Other Equityholder shall only be obligated required to indemnify any give customary representations and warranties, including, but not limited to, title to interests conveyed, legal authority and capacity and non-contravention of other Person in connection with such Dragagreements. (d) Notwithstanding the foregoing, no drag-Along Sale severally; provided, further, that no Other Investor along rights under this Section 5 shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder apply with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SalePermitted Transfer.

Appears in 3 contracts

Samples: Equityholders Agreement (Dex Media West LLC), Equityholders Agreement (Dex Media International Inc), Equityholders Agreement (Dex Media Inc)

Drag-Along Rights. (ai) If, In the event that the holders of at any time prior to a Qualified IPO, any Investor least 66% of the then outstanding shares of Series B Preferred Stock (the “Drag-Along SellerProposing Stockholders”) secures agree to and accept an irrevocable offer to acquire all share capital from a third party or assets of the Company third parties not Affiliated with any Proposing Stockholder (a “Drag-Along SaleBuyer”) to consummate a transaction or series of related transactions with a valuation such Buyer pursuant to which Buyer would acquire all of the Company of more than US$600,000,000 with any Person Shares held by such Proposing Shareholders for a specified price payable in cash, securities or other consideration and on specified terms and conditions, the Participant shall be required, if so demanded by the Proposing Shareholders (such Person, a “Drag-Drag Along PurchaserNotice”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote sell all of the other Investors Participant’s Restricted Shares to such Buyer in such transaction(s) and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-transaction(s) (a “Drag Along Sale as set forth in this Section 9.1Sale”). (bii) If The provisions of this Paragraph 3(k) shall apply regardless of the Drag-form of consideration received in the Drag Along Sale, and the Participant shall (i) if the Drag Along Sale is structured as a sale of Sharesmerger or consolidation, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by waive any dissenters’ rights, appraisal rights or similar rights in connection with such Other Investor on the same terms and conditions as are applicable to the Drag-Along Sellermerger or consolidation, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) if the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Drag Along Sale is structured as a mergersale, amalgamation or scheme of arrangement agree to sell all of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Participant’s Restricted Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in approved by the Drag-Along Sale Notice and to tender its SharesProposing Stockholders. The price and form of consideration payable in such transfer Participant (a) shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements terms and conditions, and (b) shall execute such documents and take such actions as are applicable to the Drag-Along Seller, (iii) may be reasonably required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors Proposing Shareholders. (iii) Upon the consummation of the Drag Along Sale, the Participant (i) shall receive the same form of consideration and the same amount of consideration per share of Common Stock (on an As Converted Basis) as every other holder of any class or series of Shares, except to the extent otherwise approved in connection with Section 2 of the proposed transaction (whether or not consummated), including all attorney’s fees Amended and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by Restated Certificate of Incorporation of the Company, as amended from time to time, and (vii) shall be given the same option, if any, as any other holders of any other class or series of Shares as to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights form of consideration to which they may be entitled in connection with a Drag-Along Salereceived.

Appears in 3 contracts

Samples: Restricted Stock Agreement (Bluestem Brands, Inc.), Restricted Stock Agreement (Bluestem Brands, Inc.), Nonqualified Stock Option Agreement (Bluestem Brands, Inc.)

Drag-Along Rights. (a) If, at any time prior to The SLP Investors may give written notice (a Qualified IPO, any Investor (the “Drag-Along SellerNotice”) secures an irrevocable offer to acquire all share capital the Non-SLP Stockholders that the SLP Investors intend to enter into a transaction or assets a series of related transactions involving the transfer, of not less than fifty percent (50%) of the Company outstanding Share Equivalents (which Share Equivalents to be transferred may include Share Equivalents held by the Non-SLP Stockholders and/or other holders of Share Equivalents) to a Person or “group” of Persons (other than to the SLP Investors or an Affiliate of the SLP Investors), whether by merger, tender offer or otherwise (a “Drag-Along Sale”) with a valuation of ), and, that the Company of more than US$600,000,000 with any Person (such Person, a “DragSLP Investors desire to cause the Non-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, SLP Stockholders to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor transaction on the same terms and conditions as are applicable available to the DragSLP Investors; provided, however that no Non-Along SellerSLP Stockholder shall be required to assume any liability or provide indemnification in connection with such transaction other than (i) liability or indemnification that relates to the ownership of, including and the same per-share consideration ability to transfer, the Share Equivalents being transferred by it and (ii) with respect to a specific class of Sharesall other liabilities or indemnification in connection with such transaction, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser its pro rata share on the same terms and conditions as the SLP Investors (based on the number of Ordinary Shares held Share Equivalents being transferred by each Stockholder in such Round C Investors (on an as-converted basis); transaction) and provided, further, that except with respect to any liability incurred waivers by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede third party after the consummation of the Drag-Along Sale. (d) The Sale of restrictions or obligations imposed on the SLP Investors and the Co-Investors by such third party pursuant to the terms and conditions of the Drag Along Sale shall extend to all SLP Investors and Co-Investors in the same manner. Such Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify also specify (1) the Drag-Along Purchaserconsideration, the per-Ordinary Share consideration for which a transfer is proposed if any, to be made (received by the “DragSLP Investors and the Non-Along Sale Price”) SLP Stockholders and all any other material terms and conditions of the proposed transaction (which price and other material terms and conditions shall be the same in all material respects for the SLP Investors and the Non-SLP Stockholders), (2) the identity of the other Person or Persons party to the transaction, (3) the date of completion of the proposed transaction (which date shall be not less than ten (10) Business Days after the date of the notice) and (4) the action or actions required of each Non-SLP Stockholder in order to complete or facilitate such proposed transaction (including the sale of Share Equivalents held by the Non-SLP Stockholder, the voting of all such Share Equivalents in favor of any such merger, consolidation or sale of assets and the waiver of any related appraisal or dissenters’ rights). If the SLP Investors are transferring less than all of the Share Equivalents held by the SLP Investors, then each Non-SLP Stockholder will transfer a number of Share Equivalents equal to the product of the following (the “Drag-Along SalePortion”): (x) the number of Share Equivalents beneficially owned by such Non-SLP Stockholder multiplied by (y) a fraction, the numerator of which is the aggregate number of Share Equivalents being transferred by the SLP Investors and the denominator of which equals the aggregate number of Share Equivalents beneficially owned by the SLP Investors. Each Other Investor Upon receipt of such Drag-Along Notice, each Non-SLP Stockholder shall be required obligated to participate take the action or actions referred to in clause (4) above. Notwithstanding the foregoing, the Co-Investors may allocate the Drag-Along Sale on Portion among all Co-Investors as determined by the terms and conditions set forth in Co-Investors such that one or more Co-Investors transfer the Dragnumber of Share Equivalents required to be transferred pursuant to this Section 3.5 by all Co-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale PriceInvestors as a group. (eb) The DragThis Section 3.5 shall terminate on the earlier of a Control Event and the three-Along Seller shall have a period of 180 days from the date of receipt year anniversary of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e)Initial Public Offering. (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 3 contracts

Samples: Stockholders Agreement (Serena Software Inc), Stockholders Agreement (Troxel Douglas D), Stockholders Agreement (Silver Lake Partners Ii L P)

Drag-Along Rights. (a) If, at If any time prior to Shareholder receives from a Qualified IPO, any Investor third party (the “Drag-Along SellerThird Party”) secures an irrevocable acting as principal and dealing at arm’s length with the Transferring Shareholder, a bona fide written offer (the “Third Party Offer”) to acquire purchase all share capital or assets (but not less than all) of the Company Shares and Convertible Securities (which transaction may include, without limitation, an offer pursuant to a merger, amalgamation, arrangement, capital reorganization, consolidation or similar transaction), and the Third Party Offer is accepted by either (i) Shareholders holding at least 50% of the votes attached to the outstanding Shares and Convertible Securities held by parties to this Agreement (including votes that attach to securities issuable upon exercise of Convertible Securities) so long as the Third Party Offer is a Qualifying Offer (as defined hereinafter), or (ii) an Investors Majority (the “Accepting Shareholders”), the Accepting Shareholders shall be entitled to obtain from the Third Party an offer (a “Drag-Along SaleOffer”) with a valuation to purchase all of the Company Shares and Convertible Securities of more the Corporation held by the Shareholders other than US$600,000,000 with any Person the Accepting Shareholders (such Person, a the Drag-Along PurchaserForced Shareholders”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable contained in the Third Party Offer, subject to the provisions of Section 6.4(b). Notwithstanding the foregoing, Xxxxxxxx shall not be required to accept a Drag Along Offer prior to the date one year from the date of this Agreement. If the consideration to be received by the Forced Shareholders in the Drag-Along SellerOffer includes consideration other than cash or cash equivalents, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined Offer shall, if necessary, include a valuation prepared in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except accordance with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along SaleSection 6.5. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor Offer shall be required to participate in irrevocable. For the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form purposes of consideration payable in such transfer shall be the Drag-Along Sale Price. this Agreement, a “Qualifying Offer” means a Third Party Offer: (ei) The Drag-Along Seller shall have a period of 180 days received within two years from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms hereof, and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject pursuant to all which the holders of the same provisions of Class 1 Shares purchased by the definitive agreements as are applicable Investors pursuant to the Drag-Along SellerSubscription Agreement would be entitled to receive aggregate proceeds, (iii) be required payable in cash, equal to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder not less than $2,000 for any breach or misrepresentation each Class 1 Share held by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SalePersons.

Appears in 3 contracts

Samples: Shareholder Agreement (Morgan Stanley), Shareholder Agreement (Francisco Partners GP II Management, LLC), Shareholder Agreement (Matthews Terence H)

Drag-Along Rights. In the event that any of the WCAS Purchasers or the Company receives a bona fide offer from a third party not affiliated with any WCAS Purchaser to purchase at least 80% of the outstanding shares of capital stock of the Company and a majority in interest of the WCAS Purchasers desires to accept such offer, and so long as the WCAS Purchasers collectively own a greater number of outstanding shares of Common Stock than the Blackstone Purchasers, such WCAS Purchasers shall have the right to require all (abut not less than all) Ifof the Stockholders to sell all (or such lesser percentage as may be necessary to achieve recapitalization accounting treatment, but in no event less than 80%) of the shares of capital stock (together with any options or warrants to acquire capital stock) then held by them (including all or the same percent of all shares, options and warrants held by such WCAS Purchasers) on the following terms: (i) such sale shall only be a sale for cash or marketable securities and all expenses of the transaction, including, without limitation, legal, accounting and investment banking fees and expenses, shall be borne by the Company (for purposes of this paragraph, "marketable securities" shall mean securities which are debt or equity securities that are actively traded on a national securities exchange located in the United States or on Nasdaq that are part of an issue with a public capitalization in excess of $100 million and that may be freely traded without limitation as to volume on such exchange or Nasdaq immediately following receipt thereof or at any time prior to a Qualified IPO, any Investor (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed thereafter by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1.Stockholder); (bii) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale (and, in the case of any Round C Investors shall not be a sale of less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer all of the Drag-Along Purchaser outstanding shares of Common Stock of the Company, the number of shares to be sold by each Stockholder) shall be allocated among the Stockholders on a pro rata basis, based on the number of Ordinary Shares shares of Common Stock (treating all "in the money" options and warrants as the number of shares of Common Stock issuable upon the exercise thereof, less such number of shares of Common Stock the aggregate fair market value of which (based on the value attributed in such sale) would be required to pay the aggregate exercise price therefor, and treating any shares of convertible preferred stock or debt of the Company on an "as-converted" basis) then held by each Stockholder; (iii) not less than 20 days prior to the closing date of such Round C Investors (on an as-converted basis); providedsale, furthersuch WCAS Purchasers shall notify each of the other Stockholders in writing of such sale, the terms thereof and the closing date thereof, and shall provide additional written notification promptly upon any amendment or modification to any thereof, all of which terms shall apply equally to all Stockholders except that except no Other Stockholder shall be required to make any representations, warranties or covenants, or bear any liability, with respect to the Company or the Company's business or with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than other Stockholder; (iv) at the proceeds from closing of such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement each of the Company or other transaction that requires Stockholders shall deliver certificates evidencing the approval of the InvestorsCommon Stock, each Investor shall vote its respective Shares (or execute options and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale warrants then held by it and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable sold in such sale, duly endorsed for transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth or accompanied by stock powers executed in such Drag-Along Sale Noticeblank, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect against payment of the purchase price therefor by wire transfer to the account or indemnification obligationsaccounts specified by such Stockholder; provided that an and (v) the Other Investor Stockholders shall only not be obligated to indemnify any other Person participate in such sale if all of the WCAS Purchasers shall not have concurrently sold all or the same percentage of their shares of Common Stock, options and/or warrants to be sold by them in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Salesale.

Appears in 3 contracts

Samples: Stockholders Agreement (Blackstone CCC Capital Partners Lp), Stockholders Agreement (Welsh Carson Anderson Stowe Viii Lp), Stockholders Agreement (Centennial Cellular Operating Co LLC)

Drag-Along Rights. (a) IfSubject to the provisions of Section 3.1 and Section 3.2 if, at any time prior while Platinum Beneficially Owns a number of shares of Common Stock equal to or greater than 50% of the total number of shares of Common Stock issued and outstanding (on a Non-Fully Diluted Basis), Platinum receives a bona fide offer from a third party to purchase or otherwise desires to Transfer shares of Common Stock to a Qualified IPOthird party on arm’s length terms (a “Sale Proposal”), any Investor including Common Stock owned by other Stockholders (the “Drag-Along SellerDrag Shares), and (i) secures such Sale Proposal, if consummated, would result in a Change in Control (taking into account all shares of Common Stock being “dragged”), (ii) such Sale Proposal does not involve the transfer of Drag Shares to Platinum or an irrevocable offer to acquire all share capital or assets Affiliate of Platinum and (iii) in such Sale Proposal, if consummated, Platinum would receive the same form of consideration as the other stockholders of the Company (a “Drag-Along Required Sale”), then Platinum may deliver a written notice (a “Required Sale Notice”) with a valuation respect to such Sale Proposal at least ten (10) Business Days prior to the anticipated closing date of such Required Sale to all other Stockholders requiring them to sell or otherwise Transfer their Common Stock to the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to proposed transferee in accordance with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote provisions of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.13.3(a). (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Required Sale Notice shall identify include the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the DragRequired Sale, including (i) the name and address of the proposed transferee, (ii) the proposed amount and form of consideration (and if any portion of the consideration is other than cash, any material information made available to Platinum with respect to such non-Along cash consideration that a Stockholder may reasonably request); provided, however, that the provision of such information (or, except with respect to (i) and (ii) of this sentence, lack thereof) shall not relieve any Stockholder of its obligation to sell or otherwise Transfer its Common Stock under this Section 3.3(b) and (iii) the proposed Transfer date, if known. Platinum shall deliver or cause to be delivered to each other Stockholder a copy of the final sale agreement for the Required Sale as soon as reasonably practicable after the same becomes available. (c) Each Stockholder, upon receipt of a Required Sale Notice, shall be obligated to sell or otherwise Transfer, the same proportion of its Common Stock as is being Transferred by Platinum and to otherwise participate in the Required Sale contemplated by the Sale Proposal, to vote, if required by this Agreement or otherwise, its Common Stock in favor of the Required Sale at any meeting of the Company’s stockholders called to vote on or approve the Required Sale and/or to consent in writing to the Required Sale. Each Other Investor , to waive all dissenters’ or appraisal or similar rights, if any, in connection with the Required Sale and to take all actions as may be reasonably necessary to consummate the Required Sale, including, without limitation, entering into agreements and delivering certificates and instruments, in each case, with terms and conditions that are no worse to such Stockholder than the agreements being entered into and the certificates being delivered by Platinum relating to the Required Sale, and to agree (as to itself) to make to the proposed purchaser the same representations, warranties, covenants, indemnities and agreements as Platinum agrees to make in connection with the Required Sale, and to take or cause to be taken all other actions as may be reasonably necessary to consummate the Required Sale; provided, however, that unless otherwise agreed by any Stockholder, (w) a Stockholder shall not be required to make representations and warranties (but, subject to clause (z) below, shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and provide several but not joint indemnities with respect to tender its Shares. The price and form breaches of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants made, and enter into such definitive agreements all other actions taken in connection therewith, by, or with respect to, the Company or its Subsidiaries) or provide indemnities as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from to any other Stockholder and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) a Stockholder shall not be required to bear make any representations and warranties about the business of the Company or its proportionate share Subsidiaries, (x) no Stockholder shall be liable for the breach of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify covenant by any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securitiesStockholder, (ivy) no Stockholder shall be required to bear its proportionate share of the costs and expenses incurred by enter into any agreement not to compete (or other restrictive covenant) with the Company and the Investors or any of its Subsidiaries in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the CompanyRequired Sale, and (vz) notwithstanding anything in this Section 3.3(c) to the extent permitted by applicable Lawcontrary, not exercise any dissenters’ liability relating to representations and warranties and covenants (and related indemnities) and other indemnification, escrow or appraisal rights to which they may be entitled continuing obligations regarding the business of the Company or its Subsidiaries in connection with the Required Sale shall be shared by a Drag-Along Stockholder in proportion to the proceeds received by such Stockholder and in any event shall not exceed the proceeds received by such Stockholder in the Required Sale.

Appears in 3 contracts

Samples: Stockholders' Agreement (Custom Truck One Source, Inc.), Stockholders' Agreement (Custom Truck One Source, Inc.), Common Stock Purchase Agreement (Nesco Holdings, Inc.)

Drag-Along Rights. (a) If, at any time prior to a Qualified IPO, any Investor (If the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets Board of Directors of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as such term is defined in the Memorandum Amended and ArticlesRestated Voting Agreement, dated as of August 20, 2010, by and among the Company and the other parties thereto (as amended from time to time, the “Voting Agreement”)) or (ii) the purchase price as stated in the offer holding at least two-thirds of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors Common Stock (determined on an as-converted basis) held by all Investors (or such other requisite group of Investors as may be established by amendments to the Voting Agreement after the date hereof) approve a transaction or series of related transactions deemed to be a “Liquidation Transaction” pursuant to the Company’s Amended and Restated Certificate of Incorporation (as amended from time to time, the “Restated Certificate”); provided, furtherParticipant agrees (i) to vote all Shares then held by Participant in favor of such Liquidation Transaction and (ii) to sell or exchange all Shares then held by Participant pursuant to the terms and conditions of such Liquidation Transaction, that except subject to the following conditions: (a) Participant shall not be required to make any representation, covenant or warranty in connection with the Liquidation Transaction more extensive in scope than those being made by the Investors; (b) the consideration payable with respect to any liability incurred by each share in each class or series of capital stock of the Company as a result of such Other Investor individually, Liquidation Transaction is the same (except for cash payments in lieu of fractional shares) as for each other share in such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale.same class or series; and (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme each class and series of arrangement capital stock of the Company or other transaction that requires will be entitled to receive the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and same form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all the same indemnity and escrow provisions) as a result of such Liquidation Transaction, provided that (i) each class or series may receive an amount per share of consideration that is greater or less than other classes or series in accordance with the Restated Certificate and (ii) individual classes or series may be subject to a greater or lesser allocation of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or aggregate indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), escrow obligations to the extent not paid by necessary to respect the Companyrelative rights of each class and series to receive proceeds upon a Liquidation Transaction, and (v) to in accordance with the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.Restated Certificate

Appears in 3 contracts

Samples: Stock Option Agreement, Stock Option Agreement (Apptio Inc), Stock Option Agreement (Apptio Inc)

Drag-Along Rights. (ai) If, In the event that one or more Initial Stockholders holding at any time prior to least a Qualified IPO, any Investor majority of the then-issued and outstanding Shares (the “Drag-Along SellerRightholders”) secures an irrevocable offer determine to acquire cause a bona fide sale of (x) all share capital of the then-issued and outstanding Shares then held by the Drag-Along Rightholders or (y) all or a substantial portion of the consolidated assets of the Company and its subsidiaries, taken as a whole, to any single Third Party Purchaser (or group of related purchasers), whether directly or indirectly or by way of merger, statutory share exchange, recapitalization, reclassification, consolidation, or other business combination transaction or purchase of beneficial ownership (either (x) or (y), a “Sale Transaction”) who shall not include, for the avoidance of doubt, any Affiliates of any Drag-Along Rightholders, the Drag-Along Rightholders may send written notice (the “Drag-Along SaleNotice”) with a valuation of to the Company of more than US$600,000,000 with any Person and the other Stockholders (such Person, a the “Drag-Along PurchaserSellers”) upon notifying them they will be required to sell all (but not less than all) of their Shares in such terms and conditions as agreed Sale Transaction (or, in the case of an asset sale, vote in favor of such sale). Upon receipt of a Drag-Along Notice, each Drag-Along Seller receiving such notice shall be obligated to with (i) sell all of its Shares in the Sale Transaction (including a sale or merger) contemplated by the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor Notice on the same terms and conditions as are applicable to the Drag-Along SellerSellers (including payment of its pro rata share of all costs associated with such transaction) and (ii) otherwise take all necessary action to cause the consummation of such transaction, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms voting its Shares in favor of such Sale Transaction and not exercising any appraisal rights in connection therewith. Each Drag-Along Seller further agrees to (A) take all actions (including executing documents) in connection with the consummation of the proposed Sale Transaction as may reasonably be requested of it by the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of Rightholders, (iB) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of appoint the Drag-Along Purchaser pro rata based Rightholders as its attorney-in-fact to do the same on the number of Ordinary Shares held by such Round C Investors its behalf, and (on an as-converted basis); providedC) waive any applicable dissenters’ rights, furtherappraisal rights or similar rights in connection therewith. (ii) In connection with any Sale Transaction, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a no Drag-Along Purchaser Seller shall be required to (1) make any representations or warranties (other than (x) individual customary representations and warranties as to, among other things, the unencumbered title to its Shares and the power, authority and legal right to Transfer such Shares (the “Individual Representations”) and (y) customary representations and warranties regarding the Company and its subsidiaries (the “Company Representations”)), (2) agree to any noncompetition or nonsolicitation covenants or (3) provide any indemnity, except for an amount greater than (A) indemnification related to breaches of its Individual Representations, (B) indemnification related to breaches of the proceeds from such sale. Company Representations and (cC) If any other indemnity agreed to by the Drag-Along Sale is structured as Rightholders (other than relating to a merger, amalgamation or scheme breach of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor Individual Representations of any Drag-Along Sale Rightholders); provided, that in the case of clauses (B) and all actions deemed reasonably necessary (C) above, each Drag-Along Seller’s obligation shall be several and on a pro-rata basis in proportion to its ownership interest in the Company (except in respect of any indemnification to be made from any escrow account or other form of holdback), and, other than in the case of fraud, no Drag-Along Seller shall be held liable under clauses (A), (B) or (C) above for any amount in excess of the net proceeds received by the such Drag-Along Seller in connection with any such Sale Transaction. (iii) Notwithstanding any other provision of this Section 3.1(f) to the contrary, there shall be no liability on the part of any Drag-Along SaleRightholders to any other Stockholder arising from the failure of any Drag-Along Rightholders to consummate a Sale Transaction for any reason, and against any action or proposal that may prevent, hinder or impede the consummation decision to consummate such Sale Transaction shall be in the sole discretion of the Drag-Along SaleRightholders. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 3 contracts

Samples: Stockholders Agreement (Northwestern Mutual Life Insurance Co), Stockholders Agreement (Mackay Shields LLC), Stockholders Agreement (D. E. Shaw Galvanic Portfolios, L.L.C.)

Drag-Along Rights. (a) If, at If a Dragging Stockholder proposes to Transfer to any time prior to a Qualified IPO, any Investor Third Party or Third Parties (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such in a bona fide transaction at least 90% of the aggregate outstanding Shares, the Dragging Stockholder shall deliver written notice (a “Drag-Along Notice”) to the Company and each other Stockholder (the “Drag-Along Stockholders”) stating the proposed amount of consideration for which the Shares are proposed to be Transferred (the “Drag-Along Price”) and all other proposed terms and conditions of such sale. Notwithstanding any other provision hereof, neither Major Stockholder nor any of their Permitted Transferees may be forced to Transfer any Shares pursuant to this Section 2.6 for a price per Share that is less than the price per Share that ACOF originally paid for such Shares (appropriately adjusted to reflect any Recapitalization, including the Pre-Spin Recapitalization) unless such Major Stockholder (i) has Transferred a Share to a Third Party since the date of this Agreement and (ii) beneficially owns, in the aggregate, less than 20% of the total Shares outstanding (aggregating Shares beneficially owned by Xxxxxxx and Xxxxxxx with Shares beneficially owned by ESL for purposes of this calculation and calculated without reference to any shares of Capital Stock issued or issuable on (other than shares issued as agreed part of the Pre-Spin Recapitalization) or after the date of this Agreement). (b) Upon receipt of a Drag-Along Notice, the Non-Dragging Major Stockholder shall have the right, but not the obligation, to with purchase all, but not less than all, of the Shares held by Stockholders for the cash price and on the terms set forth in the Drag-Along Seller, Notice. The Non-Dragging Major Stockholder may exercise this right by delivering to the Company and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request Stockholder within ten Business Days after receipt of the Drag-Along Seller, Notice irrevocable written notice of its commitment to participate in purchase such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell . Failure to respond to the Drag-Along Purchaser all Notice within such period shall constitute a decision not to exercise this right. Delivery of written notice exercising this right shall constitute a binding contract for the purchase and sale of such Shares then held by such Other Investor on the same terms and conditions as are applicable to set forth in the Drag-Along SellerNotice. The closing of the purchase and sale of such Shares shall occur at the offices of the Company on a date agreed to in writing by the Dragging Stockholder and the Non-Dragging Major Stockholder or, including if no such agreement can be reached, on a date that is the same per-share consideration with respect to a specific class later of Shares, and shall execute the necessary transfer forms in favor (i) 120 days following delivery of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum Notice and Articles) or (ii) two Business Days after the purchase price as stated in the offer satisfaction of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such saleConditions. (c) If such Shares are not purchased pursuant to Section 2.6(b), then the Dragging Stockholder shall be permitted to proceed with the Drag-Along Sale to a Third Party on or prior to 90 days after delivery of the Drag-Along Notice (which period may be extended if necessary to satisfy any Conditions), at a price no less than that specified in the Drag-Along Notice (provided that (A) at least 90% of the consideration must be in the form of cash or Marketable Securities and (B) if any portion of the consideration is in a form other than cash or Marketable Securities, the imputed value of such consideration shall be determined in accordance with Exhibit E hereto) and on other terms not less favorable to the sellers than those terms set forth in the Drag-Along Notice, before the provisions of this Section 2.6 shall again be in effect with respect to such Shares; provided, that at least five Business Days prior to entering into the final Drag-Along Documents (the “Final Documents”) the Dragging Stockholder shall give written notice (a “Final Notice”) to the Non-Dragging Major Stockholder. The Final Notice shall identify the Drag-Along Purchaser and include a copy of all Final Documents as well as all other relevant information relating to the Drag-Along Sale. Upon receipt of a Final Notice, the Non-Dragging Major Stockholder shall have the right, but not the obligation, to purchase all, but not less than all, of the Shares held by Stockholders for the price and on the terms set forth in the Final Notice; provided that at the option of the Non-Dragging Major Stockholder it may pay the purchase price solely in cash. The Non-Dragging Major Stockholder may exercise this right by delivering to the Company and each other Stockholder within ten Business Days after receipt of the Final Notice irrevocable written notice of its commitment to purchase such Shares. Failure to respond to the Final Notice within such period shall constitute a decision not to exercise this right. Delivery of written notice exercising this right shall constitute a binding contract for the purchase and sale of such Shares on the terms and conditions set forth in the Final Notice. The closing of the purchase and sale of such Shares shall occur at the offices of the Company on (i) the date that is set forth in the Final Documents, or (ii) such other date agreed to in writing by the Dragging Stockholder and the Non-Dragging Major Stockholder. If such Shares are not purchased pursuant to this Section 2.6(c), then the Dragging Stockholder shall be permitted to proceed with the Drag-Along Sale to the specified Third Party on or prior to 120 days (which period may be extended if necessary to satisfy any Conditions) after delivery of the Drag-Along Notice on the terms set forth in the Final Documents, before the provisions of this Section 2.6 shall again be in effect with respect to such Shares. Following receipt of a Final Notice from the Dragging Stockholder pursuant to this Section 2.6(c), the Non-Dragging Major Stockholder shall, without prejudice to its rights set forth herein, participate in good faith in discussions with any such Third Party, as reasonably requested by the Dragging Stockholder. (d) Each Drag-Along Stockholder shall be required to Transfer its Shares in any Drag-Along Sale at the Drag-Along Price and upon the same terms and conditions and provisions as that of the Dragging Stockholder. Neither the Dragging Stockholder nor any of its Affiliates shall receive any direct or indirect consideration in connection with a Drag-Along Sale (including by way of fees, consulting arrangements or a non-compete payment) other than consideration received in exchange for its Shares. The Dragging Stockholders will deliver or cause to be delivered to each Drag-Along Stockholder copies of all transaction documents relating to the Drag-Along Sale (the “Drag-Along Documents”) as the same become available. (e) In connection with the Drag-Along Sale, each of the Drag-Along Stockholders may be required to make the Stockholder’s Representations, in each case in the form made by the Dragging Stockholder. No Drag-Along Stockholder shall be required to make any representations or warranties in connection with the Drag-Along Sale other than the Stockholder’s Representations. No Drag-Along Stockholder shall be liable in respect of any indemnification provided in connection with a Drag-Along Sale (i) in excess of its pro rata portion of the consideration received, (ii) in excess of the consideration received by such Drag-Along Stockholder in such sale, (iii) for the breach of any representation or warranties made by any other Stockholder, and (iv) other than on a several (and not joint) basis with other Stockholders. No Drag-Along Stockholder shall be required to participate in any escrow relating to such Drag-Along Sale in excess of such Drag-Along Stockholder’s pro rata participation in the Drag-Along Sale (based on proceeds received). (f) In the event that any such Drag-Along Sale is structured as a merger, amalgamation sale of substantially all the assets, consolidation or scheme of arrangement similar business combination, each Stockholder hereby agrees to vote in favor of the Company transaction (including acting by written consent, if requested) and take all action to waive any dissenters, appraisal or other transaction similar rights such Stockholder may have. Each Stockholder affirms that requires its agreement to vote for the approval of Drag-Along Sale is given as a condition of this Agreement and as such is coupled with an interest and is irrevocable. This voting agreement shall remain in full force and effect throughout the Investors, each Investor time that this ARTICLE II is in effect. (g) The Company shall vote its respective Shares (take all actions necessary or execute and deliver any written consents in lieu thereof) in favor of reasonably requested to consummate any Drag-Along Sale and all actions deemed reasonably necessary by shall use its reasonable best efforts to assure the Drag-Along Seller in connection with the Drag-Along Salesuccess thereof, and against any action or proposal that may preventincluding, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaserif requested, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representationssecuring the services of an investment bank, warranties selected by the Dragging Stockholder and covenants and enter into such definitive agreements as are customary for transactions of reasonably acceptable to the nature of the Drag-Along SaleCompany, to assist in procuring a purchaser; (ii) benefit from and be subject to all preparing or assisting in the preparation of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, due diligence materials; (iii) be required making such due diligence materials available to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligationsprospective purchasers; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required making its directors, officers and employees available to bear its proportionate share of the costs prospective purchasers for presentations and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, due diligence interviews and (v) entering into customary agreements with respect to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Salesale.

Appears in 3 contracts

Samples: Stockholders’ Agreement (Orchard Supply Hardware Stores Corp), Stockholders’ Agreement (Orchard Supply Hardware Stores Corp), Stockholders’ Agreement (Orchard Supply Hardware Stores Corp)

Drag-Along Rights. (ai) IfIn the event that on or after the fifth anniversary hereof a Selling Investor Member owning, at alone or together with any time prior other Member, more than 30% of the then outstanding Common Units (A) proposes to a Qualified IPOTransfer Interests, other than any Transfer to an Affiliate of such Selling Investor Member, and such Interests would represent more than 30% of the then outstanding Common Units, or (B) desires to effect an Exit Event, such Selling Investor Member shall have the right (the “Drag-Along SellerRight), upon written notice to the other Members, to require that each other Member join pro rata in such sale by selling a pro rata portion of such other Member’s Common Units on substantially the same terms (including with respect to representations, warranties and indemnification) secures as such Selling Investor Member; provided, however, that (x) any representations and warranties relating specifically to any Member (other than with respect to the representations referenced in the foregoing subsection (x)) shall only be made by that Member; (y) any indemnification provided by the Members shall be based on the relative purchase price being received by each Member in the proposed sale, either on a several, not joint, basis or solely with recourse to an irrevocable offer to acquire all share capital or assets escrow established for the benefit of the Company proposed purchaser (the Members’ contributions to such escrow to be on a “Drag-Along Sale”pro rata basis in accordance with the proceeds received from such sale), it being understood and agreed that any such indemnification obligation of a Member shall in no event exceed the net proceeds to such Member from such proposed Transfer; and (z) the form of consideration to be received by the Selling Investor Member in connection with a valuation the proposed sale may be different from that received by the other Members so long as the value of the Company consideration to be received by the Selling Investor Member is the same or less than what they would have received had they received the same form of more than US$600,000,000 with any Person consideration as the other Members (as reasonably determined by the Board in good faith). For purposes of this Section 12.8, for each Member “joining the Selling Investor Member in such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to sale” shall include voting its Interests consistently with the Drag-Along SellerSelling Investor Member, transferring its Interests to a corporation organized in anticipation of such sale in exchange for capital stock of such corporation, executing and delivering agreements and documents which are being executed and delivered by the Selling Investor Member and providing such Drag-Along Sale is agreed by a majority vote of other cooperation as the other Investors and a majority vote of the Founders, each other Selling Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1Member may reasonably request. (bii) If Any Exit Event may be structured as an auction and may be initiated by the Drag-Along Sale delivery to the Company and the other Members of a written notice that the Selling Investor Member has elected to initiate an auction sale procedure. The Selling Investor Member shall be entitled to take all steps reasonably necessary to carry out an auction of the Company, including, without limitation, selecting an investment bank, providing confidential information (pursuant to confidentiality agreements), selecting the winning bidder and negotiating the requisite documentation. The Company and each Member shall provide assistance with respect to these actions as reasonably requested. (iii) In the event the Selling Investor Member sells less than 100% of its Common Units in the Company, joining “pro rata in such sale” shall be based on relative Common Units unless the Override Unit Committee in its sole discretion determines that the Override Units shall participate in the sale, in which case the principles of clause (iv) of this Section 12.8(c) shall apply. (iv) In the event that an Exit Event is structured as a sale of SharesInterests by the Members, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to rather than a specific class of Shares, and shall execute the necessary transfer forms in favor sale of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection Company’s assets with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions subsequent distribution of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid proceeds by the Company, and (v) then the purchase agreement governing such Interest sale will have provisions therein which replicate, to the greatest extent permitted by applicable Lawpossible, not exercise any dissenters’ or appraisal rights to the economic result which they may be entitled in connection with would have been attained under Articles IX and XIII had the Exit Event been structured as a Drag-Along Salesale of the Company’s assets and a distribution of proceeds.

Appears in 3 contracts

Samples: Limited Liability Company Agreement (CVR Energy Inc), Limited Liability Company Agreement (CVR Energy Inc), Limited Liability Company Agreement (CVR Energy Inc)

Drag-Along Rights. 9.1.1 If at any time prior to a Qualified IPO any or all of the Apollo Group, the Verso Paper Investment Limited Partner or the General Partner (acollectively, the “Drag-Along Sellers”) propose a sale of Units then held by them to any Independent Third Party (a “Drag-Along Transferee”) constituting at least ten percent (10%) of the Initial Equity Stake in a transaction or series of transactions (including, without limitation, pursuant to a purchase of Units, tender offer, merger or other business combination transaction or otherwise) (a “Drag-Along Sale”), the Drag-Along Sellers may elect to require all other Partners to sell their Units in the Drag-Along Sale pursuant to this Section 9.1 (the “Drag-Along Right”). At least twenty (20) days prior to the consummation of any such Drag-Along Sale, the Drag-Along Sellers shall provide written notice of their intention to exercise the Drag-Along Right to the other Partners (the “Drag-Along Notice”). The Drag-Along Notice shall set forth in reasonable detail the terms and conditions of the Drag-Along Sale, including, without limitation, (i) the number of Units that would be Transferred by the Drag-Along Sellers, (ii) the price to be paid for the Units of the Drag-Along Sellers that would be Transferred, (iii) all other material terms of the proposed Drag-Along Sale, and (iv) notice that the Drag-Along Sellers are electing to exercise the Drag-Along Right. 9.1.2 In the event the Drag-Along Sellers elect to exercise the Drag-Along Right, each other Partner shall participate in the Drag-Along Sale by selling a number of Units of such other Partner equal to the product obtained by multiplying (i) the number Units owned by such other Partner on the date of the Drag-Along Sale by (ii) a fraction, the numerator of which is equal to the number of Units proposed to be sold by the Drag-Along Sellers and the denominator of which is the aggregate number of Units owned by the Drag-Along Sellers prior to such sale (the “Drag-Along Participation Percentage”). 9.1.3 The Transfer of Units to the Drag-Along Transferee by the Drag-Along Sellers and the other Partners pursuant to this Section 9.1 shall be consummated simultaneously. The delivery by each selling Partner of a limited partnership interest power or such other instrument of Transfer reasonably acceptable to the Drag-Along Transferee shall be made at the time such Drag-Along Sale is consummated against payment of the purchase price for such Units. To the extent that the Partners (or any successors thereto) are to provide any indemnification or otherwise assume any other post-closing liabilities in connection with any Drag-Along Sale, the Drag-Along Sellers and all other Partners selling Units in a transaction under this Section 9.1 shall do so on a pro rata basis in an amount not to exceed the proceeds received by them individually in such Drag-Along Sale. Furthermore, each selling Partner shall be required to give customary representations and warranties, including, without limitation, title to Interests conveyed, legal authority, and non-contravention of other agreements to which it is a party. Each selling Partner shall be required to enter into any instrument, undertaking or obligation necessary or reasonably requested and deliver all documents necessary or reasonably requested in connection with such Drag-Along Sale (as specified in the Drag-Along Notice) in connection with this Section 9.1. 9.1.4 If, at any time prior to a Qualified IPO, any Investor (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as Apollo Group proposes a sale of Shares, each Other Investor shall sell to any of the Drag-Along Purchaser all Shares equity of a Parent Issuer then held by such Other Investor on the same terms and conditions as are applicable Apollo Group to the Drag-Along Sellerany Independent Third Party in a transaction or series of transactions (including, including the same per-share consideration with respect without limitation, pursuant to a specific class purchase of SharesUnits, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); providedtender offer, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company merger or other business combination transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaserotherwise), the per-Ordinary Share consideration for which a transfer is proposed General Partner may elect to be made (the “Drag-Along Sale Price”) and require all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required Partners to participate sell their Units in the Drag-Along Sale on the terms pursuant to this Section 9.1 in an equivalent amount and conditions set forth in at an equivalent price as if the Drag-Along Sale Notice and Sellers proposed to tender its Shares. The price and form sell the number of consideration payable in such transfer shall be Units that indirectly correspond to the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt equity of the Drag-Along Sale Notice Parent Issuer so proposed to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period sold and the Drag-Along Seller proposes to effect a Sellers had elected its Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in Right pursuant to this Section 9.1(e)9.1. (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 3 contracts

Samples: Limited Partnership Agreement (Verso Paper Holdings LLC), Limited Partnership Agreement (Verso Sartell LLC), Limited Partnership Agreement (Verso Paper Corp.)

Drag-Along Rights. (a) If, at 4.1 At any time prior to before a Qualified IPO, subject to the approval of the Majority Investors, if Majority Series F Investors, Majority Series E Investors, Majority Series D Investors, the holders of more than sixty-seven percent (67%) of Series C Preferred Shares, Majority Series B Investors and Majority Series A Investors, each voting as a single class on an as converted basis and as if the Warrant had been fully exercised (such holders of the Preferred Shares are referred to as the “Drag Holders”) all agree to accept an offer to sell all of the equity or assets of all of the Group Companies, or the business conducted by these Group Companies to any Investor Person (the “Offeror”) (such accepted offer is hereinafter referred to as the “Approved Sale”), provided that immediately prior to the Approved Sale the valuation of the Group Companies shall be no less than US$2,000,000,000, then at the request of the Drag Holders, the Company shall promptly deliver a written notice (the “Drag-Along SellerNotice”) secures an irrevocable offer to acquire notify each other holder of the Equity Securities of the Company such acceptance and the material terms and conditions of such proposed Approved Sale, whereupon each such holder shall, subject to the provisions in this Section 4, in accordance with instructions received from the Company at the direction of the Drag Holders: (i) sell, at the same time as the Drag Holders sell to the Offeror, in the Approved Sale, all share capital of its Equity Securities of the Company, on the same terms and conditions as were agreed to by the Drag Holders; provided, however, that such terms and conditions, including the price paid or assets received per Equity Security of the Company, shall be the same irrespective of any different classes of the Equity Securities of the Company, provided, however, further that each Approved Sale shall be a Deemed Liquidation Event and the proceeds therefrom shall be distributed in accordance with Article 8.2(B) of this Memorandum and Articles; (ii) vote, or give his written consent with respect to, all the Equity Securities of the Company directly or indirectly held by it (a) in favor of such Approved Sale and in opposition of any proposal that could reasonably be expected to delay or impair the consummation of any such Approved Sale, (b) against any other consolidation, recapitalization, amalgamation, merger, sale of securities, sale of assets, business combination, or transaction that would interfere with, delay, restrict, or otherwise adversely affect such Approved Sale, and (c) against any action or agreement that would result in a breach of any covenant, representation or warranty or any other obligation or agreement of the Company under the definitive agreement(s) related to such Approved Sale or that could result in any of the conditions to the closing obligations under such agreement(s) not being fulfilled, and, in connection therewith, to be present (in person or by proxy) at all relevant meetings of the shareholders of the Company (or adjournments thereof) or to approve and execute all relevant written consents in lieu of a “Drag-Along meeting; (iii) not exercise any dissenters’ or appraisal rights under applicable Law with respect to such Approved Sale; (iv) with a valuation transfer all of its Equity Securities of the Company of more than US$600,000,000 with any Person (in such Person, a “Drag-Along Purchaser”) Approved Sale to the proposed purchaser at the same price and upon such the same terms and conditions as agreed to the Drag Holders; (v) take all necessary actions in connection with the consummation of such Approved Sale as reasonably requested by the Drag Holders, including but not limited to the execution and delivery of any share transfer or other agreements prepared in connection with such Approved Sale, and the delivery, at the closing of such Approved Sale involving a sale of Shares, of all or corresponding (as applicable) certificates representing the Equity Securities held or controlled by such holder, duly endorsed for transfer or accompanied by a duly executed share transfer form, or affidavits and indemnity undertakings with respect to lost certificates. The Drag-Along SellerNotice can be withdrawn effectively only by the acceptance of all holders of the Equity Securities of the Company in writing. Once the withdrawal is effective, and such any new Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, Notice can be delivered at the request of the Drag-Along Seller, Holders subject to participate in such Drag-Along Sale as terms and conditions set forth hereof in this Section 9.14.1. (b) If 4.2 After the date upon which the Drag-Along Sale along Notice is structured delivered, in the event that there are offers from any Person other than the Offeror (the “New Offeror”, collectively as “New Offerors”) to any holder of Equity Securities other than the Drag Holders to buy all of the equity or assets of all of the Group Companies, or the business conducted by these Group Companies, provided that the valuation of the Group Companies in such offer is not less than US$2,000,000,000 (such transaction is hereinafter referred to as the “New Sale”): (i) if there is any agreement executed between the Offeror and the Drag Holders, with the binding effect of prohibiting such Drag Holders from seeking, contacting, negotiating, committing or executing an agreement with any third party other than the Offeror within a sale given period determined by the Drag Holders (such clauses in the agreement is hereafter referred to as the “Exclusion Clause”, and if the given period is more than 6 months, it shall be further agreed by Main Access and PAC), then all holders of Sharesthe Equity Securities shall refrain from seeking, each Other Investor shall sell to contacting, negotiating, committing or executing any form of agreements with any of the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration New Offeror with respect to a specific class the New Sale that would constitute breach of Sharessuch Exclusion Clause; (ii) if there is no binding agreement containing such Exclusion Clause executed between the Offeror and the Drag Holders, and or such Exclusion Clause is invalid, terminated or expired, then the Drag Holders shall execute have sole discretion to request the necessary transfer forms in favor other holders of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount Equity Securities to execute Decisive Agreements (as defined in the Memorandum and Articles) with the Offeror or any of the New Offerors, and the other holders of the Equity Securities shall, use their best efforts, to execute the Decisive Agreement and consummate the sale contemplated thereunder, provided that: (iia) the Decisive Agreement shall be executed with the offeror who offers the highest purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on Group Companies among all offerors; (b) if there are more than one (1) offeror both offering the number highest purchase price of Ordinary Shares held by such Round C Investors (on an as-converted basis); providedthe Group Companies, further, that except the Decisive Agreement shall be executed with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale.offeror who can execute the Decisive Agreement the soonest; (c) If notwithstanding the Drag-Along Sale is structured as a mergerabove (a) and (b), amalgamation or scheme of arrangement if the offeror offering the highest valuation of the Company or other transaction that requires Group Companies fails to execute the approval Decisive Agreement with the holders of the InvestorsEquity Securities, each Investor shall vote its respective Shares (or then the Drag Holders are entitled to, in their reasonable opinion, execute the Decisive Agreement with other offeror who offers lower valuation but can execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary consummate the Decisive Agreement promptly. Once the offeror with whom the Decisive Agreement will be executed is determined by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made Drag Holders (the “Drag-Along Sale PriceDetermined Offeror) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on ), whether by applying the terms and conditions set forth in Section 4.1 or Section 4.2 hereof, the other holders of the Equity Securities will receive the final version of the Decisive Agreement. Then if such Determined Offeror requests the execution of the Decisive Agreement, the Drag Holders shall issue a written notice of its decision to the Company and other holders of the Equity Securities to execute the Decisive Agreement with such Determined Offeror. However, within five (5) Business Days after receipt of such written notice, any holder of the Equity Securities other than the Drag Holders can choose to buy out the shares (all of its Equity Securities of the Company) and issue a notice of buy-out (the “Buy-out Notice”) to the Drag Holders at terms not less favorable than the Determined Offeror (such offer is hereinafter referred to as the “Preferential Sale”, and for avoidance of doubt, any holder of the Equity Securities other than the Drag Holders, including Main Access, obtaining over 50% of the Group Company’s voting power, on a fully-diluted basis, as a result of the Preferential Sale will not trigger or be deemed as the occurrence of the Deemed Liquidation Event), then after receipt of the Buy-out Notice, the Drag Holder shall request all other holders of the Equity Securities to execute the Decisive Agreement with such holder within seven (7) Business Days from the date of the receipt of the Buy-out Notice. For avoidance of doubt, if no holder of the Equity Securities other than the Drag Holders responds in writing within the five (5) Business Days period aforementioned, then the holder shall not be entitled to exercise its right of a Preferential Sale within the relevant Restriction Period (as defined below) applicable to the applicable Determined Offeror. However, if such holder requesting Preferential Sale fails to execute the Decisive Agreement in regard to the Preferential Sale with all of the other holders of the Equity Securities within seven (7) Business Days after the issuance date of the Buy-out Notice, then the Drag Holders are entitled to request all holders of the Equity Securities to execute the Decisive Agreement with the Determined Offeror and all holders of the Equity Securities shall be obliged to execute the Decisive Agreement with the Determined Offeror upon such request. 4.3 In any Sale (as defined below), (i) each holder of Equity Securities participating in such Sale shall bear a proportionate share (based upon the relative proceeds received in such transaction) of the expenses reasonably incurred in the transaction, including, without limitation, legal, accounting and investment banking fees and expenses, and (ii) each such holder shall severally, not jointly, join on a pro rata basis (based upon the relative proceeds received in such transaction) in any indemnification or other obligations that are part of the terms and conditions of such Sale (other than those that relate specifically to a particular holder, such as indemnification with respect to representations and warranties given by such holder regarding such holder’s title to and ownership of shares, due authorization, enforceability, and no conflicts, which shall instead be given solely by such holder) but only up to the net proceeds paid to such holder in connection with such Sale. Without limiting the foregoing sentence, no such holder who is not an employee or officer or controlling shareholder of a Group Company shall be required to make any representations or warranties other than with respect to itself (including due authorization, title to shares, enforceability of applicable agreements, and similar representations and warranties). 4.4 In the event that any such holder fails for any reason to take any of the foregoing actions under this Section 4 following the Drag-Along Notice, such holder hereby grants an irrevocable power of attorney and proxy to any Director approving the Sale Notice to take all necessary actions and execute and deliver all documents deemed by such Director to tender its Shares. The price and form be reasonably necessary to effectuate the terms hereof. 4.5 None of consideration payable the transfer restrictions set forth in such transfer this Agreement shall be apply in connection with the Sale. 4.6 In the event that any of the Drag-Along Sale Price. Holders fails to execute a Decisive Agreement with the Determined Offeror within twelve (e12) The Drag-Along Seller shall have a period of 180 days from months after the date of receipt of the Drag-Along Notice (the “Restriction Period”), then within six (6) months after expiration of the Restriction Period (the “Release Period”), Main Access or PAC or Tencent or New Oriental or CVC is entitled to execute a Decisive Agreement with any Person (the “Main Access Successor” or “PAC Successor” or “Tencent Successor” or “New Oriental Successor” or “CVC Successor” as the case maybe) to sell part or all of its Equity Securities of the Company (such transaction is hereinafter referred to as the “Special Sale”, collectively with the Approved Sale, Preferential Sale Notice and New Sale, the “Sale”), provided that the Main Access Successor or PAC Successor or Tencent Successor or New Oriental Successor or CVC Successor (as the case may be), in purchasing Main Access’s Equity Securities or PAC’s Equity Securities or Tencent’s Equity Securities or New Oriental’s Equity Securities or CVC’s Equity Securities, as the case may be, shall agree to enter into a definitive agreement providing for the Drag-Along Sale on the be fully bound by and comply with any terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing or conditions and obtaining any required regulatory approvals. If enjoy the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day periodrights, the Drag-Along Seller shall again comply with the procedures as if it were Main Access or PAC or Tencent or New Oriental or CVC hereunder, set forth in this Agreement from Section 9.1(e). (f) In connection with a Drag-Along Sale4.1 to 4.9 hereof, each Other Investor shall (i) make such representationsand Memorandum and Articles from Article 121 to 129, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as which are applicable to Main Access (the Drag-Along Seller, “Main Access Terms”) or PAC (iiithe “PAC Terms”) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of Tencent (the purchase price “Tencent Terms”) or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach New Oriental (the “New Oriental Terms”) or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, CVC (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated“CVC Terms”), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by as the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they case may be entitled in connection with a Drag-Along Salebe.

Appears in 2 contracts

Samples: Right of First Refusal and Co Sale Agreement (Cloopen Group Holding LTD), Right of First Refusal and Co Sale Agreement (Cloopen Group Holding LTD)

Drag-Along Rights. So long as this Agreement shall remain ----------------- in effect and Holdings beneficially owns on a fully diluted basis an aggregate number of shares of Common Stock not less than one-fourth (a1/4) If, at any time prior to a Qualified IPO, any Investor (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets of the Company (Common Stock owned by Holdings on August 19, 1999, if Holdings receives an offer from a “Drag-Along Sale”) with a valuation Third Party to purchase all, but not less than all, of the Company outstanding shares of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, Common Stock owned by Holdings and such Drag-Along Sale offer is agreed accepted by a majority vote Holdings, then the holders of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser Oxy Shares hereby agree that they will Transfer all Shares then held Registrable Securities beneficially owned by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior them to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify Third Party upon the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price offer (including without limitation time of payment and form of consideration payable in such transfer shall be consideration) applicable to Holdings, provided that the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt holders of the Drag-Along Sale Notice Oxy -------- Shares must agree to enter into a definitive agreement providing for make to the Drag-Along Sale on Third Party the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such same representations, warranties warranties, covenants, indemnities and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject that Holdings agrees to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors make in connection with the proposed transaction Transfer; and provided further, that all -------- ------- representations and warranties shall be made by the holders of the Oxy Shares and Holdings severally and not jointly and that the liability of the holders of the Oxy Shares and Holdings (whether pursuant to a representation, warranty, covenant, indemnification provision or not consummated)agreement) for liabilities in respect of the Company shall be evidenced in writings executed by them and the Third Party and shall be borne by each of them on a pro rata basis. At the closing of any such Transfer, including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by holders of the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), Oxy Shares shall deliver to the extent not paid Third Party the certificate or certificates representing the shares of Common Stock to be sold pursuant to such sale by such holder, duly endorsed for transfer, against receipt of the Company, and (v) to purchase price thereof. The closing of the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights purchase of the Common Stock with respect to which they may be entitled in connection such rights have been exercised shall take place concurrently with a Drag-Along Salethe closing of the sale of Holdings Common Stock.

Appears in 2 contracts

Samples: Capital Contribution Agreement (Neches River Holding Corp), Capital Contribution Agreement (Neches River Holding Corp)

Drag-Along Rights. (a) IfIf Shareholders holding, at any in the aggregate, greater than fifty percent (50%) of the Company Shares owned by the Shareholders from time prior to a Qualified IPO, any Investor time (the “Drag-Along SellerSelling Shareholders”) secures an irrevocable offer agree to acquire all share capital or assets of enter into a bona fide sale transaction (the Company (a “Drag-Along Sale”) with a valuation of which would result in the Company Transfer of more than US$600,000,000 with fifty percent (50%) of the aggregate Company Shares (including any Person Company Shares held by other holders of Company Shares, including any Drag- Along Shareholders) to one or more third parties that is not a Permitted Transferee or Affiliate of any Selling Shareholder (such Person, a the “Drag-Along PurchaserBuyer) upon such terms and conditions as agreed to with ), the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and Selling Shareholders may deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made each other Shareholder (the “Drag-Along Sale PriceShareholders) ), stating that such Selling Shareholders wish to exercise their rights under this Section 4.4 with respect to such Transfer (a “Drag-Along Election”), and setting forth the name and address of the Drag-Along Buyer, the number of Company Shares proposed to be Transferred, the proposed amount and form of the consideration, and all other material terms and conditions offered by the Drag-Along Buyer. Notwithstanding the foregoing, no Drag-Along Election may be made (i) without the approval of the GSCP Parties so long as the GSCP Parties collectively hold at least 25% of their aggregate Initial Post-IPO Share Ownership and (ii) without the approval of the Providence Parties so long as the Providence Parties collectively hold at least 25% of their aggregate Initial Post-IPO Share Ownership. (b) Upon delivery of a Drag-Along Notice, each Drag-Along Shareholder shall be required to Transfer that percentage of its Company Shares equal to the percentage of the Company Shares held by the Selling Shareholders which are being Transferred to the Drag-Along Buyer, upon the same terms and conditions (including, without limitation, as to price, time of payment and form of consideration) as agreed by the Selling Shareholders and the Drag-Along Buyer and shall agree to the same conditions to the Transfer as the Selling Shareholders agree (including representations, warranties, covenants, indemnities and other agreements, but not any non-competition or similar agreements or covenants that would bind the Drag-Along Shareholder or its Affiliates); provided, however, that no Shareholder shall be required to make any representations or warranties in any agreement relating to a Drag-Along Sale other than representations and warranties relating to such Shareholder and the ownership of its Company Shares that are customary in similar transactions including, without limitation, representations and warranties relating to title, authorization and execution and delivery; it being further understood that all such representations, warranties, covenants, indemnities and agreements shall be made by each Selling Shareholder and each Drag-Along Shareholder severally and not jointly and that, except with respect to individual representations, warranties, covenants, indemnities and other agreements of the Drag-Along Sale. Each Other Investor shall be required Shareholder as to participate in the unencumbered title to its Company Shares and the authorization and execution and delivery of the applicable agreements and such Company Shares, the aggregate amount of the liability of the Drag-Along Sale on Shareholder shall not exceed the lesser of (i) such Drag-Along Shareholder’s pro rata portion of any such liability, to be determined in accordance with such Drag-Along Shareholder’s portion of the total number of Company Shares included in such Transfer or (ii) the proceeds to such Drag-Along Shareholder in connection with such Transfer. (c) In the event that any such Transfer is structured as a merger, consolidation, or similar business combination, each Drag-Along Shareholder agrees to (i) vote all of the Company Shares held by such Drag-Along Shareholder in favor of the transaction, (ii) take such other Necessary Action as may be required to effect such transaction (subject to Section 4.4(b)) and (iii) take all action to waive any dissenters, appraisal or other similar rights with respect thereto. (d) Solely for purposes of Section 4.4(c)(i) and in order to secure the performance of each Shareholder’s obligations under Section 4.4(c)(i), each Shareholder hereby irrevocably appoints each other Shareholder that qualifies as a Drag-Along Proxy Holder (as defined below) the attorney-in-fact and proxy of such Shareholder (with full power of substitution) to vote or provide a written consent with respect to its Company Shares as described in this paragraph if, and only in the event that, such Shareholder fails to vote or provide a written consent with respect to its Company Shares in accordance with the terms of Section 4.4(c)(i) (each such Shareholder, a “Breaching Drag-Along Shareholder”) within three (3) days of a request for such vote or written consent. Upon such failure, the Selling Shareholders shall have and conditions are hereby irrevocably granted a proxy to vote or provide a written consent with respect to each such Breaching Drag-along Shareholder’s Company Shares for the purposes of taking the actions required by Section 4.4(c)(i) (such Selling Shareholders, a “Drag-Along Proxy Holder”). Each Shareholder intends this proxy to be, and it shall be, irrevocable and coupled with an interest, and each Shareholder will take such further action and execute such other instruments as may be necessary to effectuate the intent of this proxy and hereby revoke any proxy previously granted by it with respect to the matters set forth in Section 4.4(c)(i) with respect to the Drag-Along Sale Notice and to tender its SharesCompany Shares owned by such Shareholder. The price and form of consideration payable in such transfer Notwithstanding the foregoing, the conditional proxy granted by this Section 4.4(d) shall be deemed to be revoked upon the Drag-Along Sale Pricetermination of this Article IV in accordance with its terms. (e) The If any Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice Shareholder fails to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable deliver to the Drag-Along SellerBuyer the certificate or certificates evidencing Company Shares to be sold pursuant to this Section 4.4, (iii) be required the Selling Shareholders may, at their option, in addition to bear its proportionate share of any escrowsall other remedies they may have, holdbacks or adjustments in respect of deposit the purchase price (including any promissory note constituting all or indemnification obligations; provided that an Other Investor any portion thereof) for such Company Shares with any national bank or trust company having combined capital, surplus and undivided profits in excess of $100 million (the “Escrow Agent”), and the Company shall only be obligated to indemnify any other Person in connection with cancel on its books the certificate or certificates representing such Company Shares and thereupon all of such Drag-Along Sale severally; providedShareholder’s rights in and to such Company Shares shall terminate. Thereafter, further, that no Other Investor shall be obligated upon delivery to indemnify any other shareholder for any breach or misrepresentation the Company by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along SellerShareholder of the certificate or certificates evidencing such Company Shares (duly endorsed, an investment banking firm selected by or with stock powers duly endorsed, for transfer, with signature guaranteed, free and clear of any liens or encumbrances, and with any stock transfer tax stamps affixed), the Selling Shareholders shall instruct the Escrow Agent to deliver the purchase price (without any interest from the date of the closing to the date of such delivery, any such interest to accrue to the Company) to such Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleShareholder.

Appears in 2 contracts

Samples: Shareholders Agreement (Education Management Corporation), Shareholder Agreement (Education Management Corporation)

Drag-Along Rights. (a) IfIf any member of the Invus Group obtains from the Company or a Person who is not an Invus Affiliate (the Company or such Person, at each, a “Drag Offeror”) a bona fide offer (an “Initial Drag Offer”) to purchase any time prior or all of the shares of Capital Stock (such Capital Stock being sold by the Invus Group, the “Seller’s Stock”) held by a member of the Invus Group (each such member, a “Seller”), and such Seller wishes to accept the Initial Drag Offer, the Seller may obtain from the Drag Offeror a Qualified IPO, any Investor bona fide offer (the “Drag-Drag Along SellerOffer”) secures an irrevocable offer addressed to acquire all share capital or assets the Carried Stockholder(s) to purchase a pro rata portion of the Company shares of Capital Stock held by the Carried Stockholder(s) (a the Drag-Along SaleCarried Stock”) with a valuation determined by multiplying the amount of the Company Capital Stock held by the Carried Stockholder(s) by a fraction the numerator of more than US$600,000,000 with any Person which is the number of shares of the Seller’s Stock and the denominator of which is the total number of shares of Capital Stock held by the Invus Group (such Personrounded down to the nearest full share). If the Seller agrees to make a Drag Along Offer, the Seller shall deliver to the Carried Stockholder(s) a notice (the Drag-Drag Along PurchaserNotice”) upon such setting forth the principal terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote proposed Transfer, including (i) the number of shares of the Founders, each other Investor Seller’s Stock; (an “Other Investor”ii) agrees, at the request name and address of the Drag-Along Seller; and (iii) the proposed price (or the formula pursuant to which the purchase price will be determined) and payment terms for said Seller’s Stock, to participate including, if such payment is in a form other than cash or cash equivalent, a good faith estimate of such Drag-Along Sale as set forth in this Section 9.1. (b) If property’s fair market value. The purchase of the Drag-Along Sale is structured as a sale of Shares, each Other Investor Carried Stock shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor be on the same terms and conditions as are applicable contained in the Initial Drag Offer, including at the same price per share of Capital Stock offered to the Drag-Along Seller. If an option as to the form and amount of consideration to be received is given by the Drag Offeror, the Seller and the Carried Stockholder(s) will be given the same option other than to the extent prohibited by law. (b) In addition, if the Invus Group votes its Equity Securities in favor of a Change in Control where the acquiror of the Company is not an Invus Affiliate (a “Qualified Change in Control”), then each Carried Stockholder shall vote all of its Equity Securities to approve such Qualified Change in Control and take all actions reasonably necessary to consummate such Qualified Change in Control (including the execution of all transaction-related documents required in connection therewith, but only so long as such documents treat both the Carried Stockholder(s) and the members of the Invus Group in the same per-share consideration fashion with respect to the proportionate receipt of consideration and benefits and restrictions in connection with such Qualified Change in Control). If an option as to the form and amount of consideration to be received is given in connection with a specific class of SharesQualified Change in Control, the Invus Group and shall execute the necessary transfer forms in favor of Carried Stockholder(s) will be given the Drag-Along Purchaser; provided same option other than to the extent prohibited by law. Each Carried Stockholder hereby acknowledges that by agreeing to this Section 6.2, such Carried Stockholder is waiving any dissenters’ rights or rights to appraisal to which the proceeds from such sale of any Round C Investors shall not Carried Stockholder(s) would otherwise be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except entitled with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such saleQualified Change in Control. (c) If Each Carried Stockholder shall be obligated to accept the Drag-Drag Along Sale is structured as a merger, amalgamation or scheme Offer within ten (10) days of arrangement receipt of the Company or other transaction that requires the approval Drag Along Offer. The acceptance of the Investors, each Investor Drag Along Offer shall vote its respective Shares (or execute be made in writing and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation a copy of the Drag-acceptance of the Drag Along SaleOffer shall be delivered to the Seller within such ten (10) day period. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than Within ten (10) days prior (or such longer period as consented to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify by the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”Seller) and all other material terms and conditions after receipt of the Drag-Drag Along Sale. Each Other Investor Offer by the Carried Stockholder(s), each Carried Stockholder shall deliver (or in the event the Carried Stockholder(s) shall fail to deliver, shall be required deemed to participate in have delivered) to the DragSeller: (i) a limited power-Along Sale of-attorney authorizing the Seller or such other Person designated by the Company to sell the Carried Stock (including authorizing the execution of any stock power) on the terms and conditions set forth contained in the Drag-Drag Along Sale Notice Offer and to tender its Sharestake such other actions reasonably required in connection therewith; and (ii) one or more certificates which represent the number of shares of Carried Stock which such Carried Stockholder is being required to sell pursuant the Drag Along Offer. Each Carried Stockholder shall also make, severally and not jointly, substantially the same representations, warranties, covenants and indemnities as the Seller agrees to make in connection with the proposed sale by the Seller of the Seller’s Stock to the Drag Offeror. The price and form of consideration payable documents delivered to the Seller by the Carried Stockholder(s) as provided in such transfer this Section 6.2 shall be held in escrow by the Drag-Seller pending the closing of the applicable Drag Along Sale PriceOffer. (e) The Drag-Along Seller shall have a period consummate the purchase of 180 days the Seller’s Stock, and the purchase from the date of receipt Carried Stockholder(s) of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale Carried Stock, on the terms and conditions set forth in such Drag-conditions, within one hundred and eighty (180) days of the delivery of the Drag Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvalsOffer. If the Drag-Drag Along Seller has Offer is not entered into a definitive agreement providing for consummated within one hundred and eighty (180) days after the Drag-delivery of the Drag Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day periodOffer, the Drag-Carried Stockholder(s) shall no longer be obligated by the terms of this Section 6.2 with respect to the Drag Along Offer. If the proposed sale is not consummated in accordance with the foregoing, the Seller shall return to the Carried Stockholder(s) all stock certificates and other documents furnished by such Carried Stockholder to the Seller in contemplation of the sale of Carried Stock pursuant to the Drag Along Offer, and all restrictions on the sale of Seller’s Stock and Carried Stock contained in this Agreement shall again comply be in effect. Simultaneously with the procedures set forth closing of the proposed sale, in accordance with the foregoing, the Seller shall notify the Carried Stockholder(s) of the closing and shall remit directly to the account specified by each Carried Stockholder that portion of the sale proceeds to which such Carried Stockholder is entitled at such time by reason of its participation in the sale. Each Carried Stockholder shall take all steps, execute all such documents and do all such acts and things as may be within its power to implement to their full extent the provisions of this Section 9.1(e)6.2. (f) In connection Each Carried Stockholder hereby grants to the Invus Group an irrevocable proxy, coupled with a Drag-Along Salean interest, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to vote all of such Carried Stockholder’s Carried Stock and appoints the same provisions of the definitive agreements Invus Group as are applicable its agent and attorney-in-fact to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by take such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), actions to the extent not paid necessary to carry out the provisions of this Section 6.2 in the event of any breach of this Section 6.2 by the CompanyCarried Stockholder(s) or its or their Affiliates, successors, custodians or assigns (and (v) shall, upon request by the Invus Group, execute and deliver a power of attorney in form and substance reasonably satisfactory to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleInvus Group evidencing the foregoing).

Appears in 2 contracts

Samples: Investor Rights Agreement, Investor Rights Agreement (Blue Buffalo Pet Products, Inc.)

Drag-Along Rights. (a) IfIf the Gores Investors desire to participate in a Sale, they shall have the right to require the Investor Stockholders to: (i) sell all Class A Common Stock held by them at any time prior the same price per share, for the same form of consideration (which shall be cash) and pursuant to a Qualified IPO, any Investor (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such same terms and conditions as agreed are applicable to with the Drag-Along Seller, and Gores Investor; (ii) vote such Drag-Along Sale is agreed by a majority vote Class A Common Stock in favor of the other Investors and transactions constituting a majority vote Sale; (iii) tender their shares of the Founders, each other Investor Class A Common Stock; (an “Other Investor”iv) agrees, at the request of the Drag-Along Seller, waive their appraisal or dissenters’ rights with respect to such transaction; and (v) otherwise participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect Gores. Each Investor Stockholder agrees to a specific class of Shares, take any and shall execute the necessary transfer forms all action in favor furtherance of the Drag-Along Purchaser; provided that foregoing reasonably requested by the proceeds from such sale of any Round C Investors shall not be less than Gores Investor. (b) Each Investor Stockholder agrees to vote for the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer approval of the Drag-Along Purchaser pro rata based on transaction constituting a Sale under this Section 4.02 and such agreement is given as a condition of this Agreement and as such is coupled with an interest and is irrevocable. This voting agreement shall remain in full force and effect throughout the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, time that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such salethis Section 4.02 is in effect. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, The Gores Investors will give each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor Stockholder at least 7 Business Days advance notice of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along a Sale. (d) The Drag-Along Seller Not later than 7 Business Days following the date a Gores Investor delivers a written notice to each of the Investor Stockholders that it has entered into or will enter into a definitive agreement with a purchaser in connection with a Sale within 10 Business Days of the date of such notice, each Investor Stockholder shall deliver one or more certificates representing the shares held by such Investor Stockholder to be transferred, accompanied by duly executed stock powers, to an escrow agent pursuant to escrow arrangements reasonably acceptable to the Gores Investor and the Investor Stockholders providing for release concurrently with the consummation of such Sale and requiring the return thereof to each Investor Stockholder on the date 60 days after the date of such notice if such Sale has not been consummated by such 60th day. Upon any such return, each Stockholder Investor shall be able to Transfer freely the Class A Common Stock held by it, subject to a new notice delivered pursuant to this Section 4.02(d). If any Investor Stockholder fails to deliver such certificates to the Gores Investor, then the Gores Investor shall provide written notice of a proposed Drag-Along Sale such failure to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to Company in accordance with Section 5.01. Upon receipt of such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchasernotice, the per-Ordinary Share consideration for which a Company agrees that it shall not record the transfer is proposed to be made (of such shares on the “Drag-Along Sale Price”) books and all other material terms and conditions records of the Drag-Along Company and shall promptly direct the Company’s transfer agent, if any, that the transfer agent shall also not record the transfer of such shares on the books and records of the Company. In connection with such Sale. Each Other , no such Investor Stockholder shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, any representations other than Stockholder Representations or (ii) benefit from and participate in any escrow or indemnity obligation relating to such Sale in excess of such Investor Stockholder’s pro rata participation in the Sale (based on proceeds to be subject to all received). Any indemnity obligation of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled Stockholder in connection with a DragSale in which it will participate will be several and not joint and will be limited to its pro rata share of the actual amount of such indemnification obligation and in no event shall its payment (or deemed payment) in respect thereof, together with all other indemnification payments (or deemed payments) in respect of such Sale, be greater than (A) the amount of consideration actually received by it at or before the time such indemnification payment is made and (B) the forfeit by such Investor Stockholder of any consideration to which it is entitled but has not yet received (including, without limitation, as a result of an escrow agreement, earn-Along Saleout or similar arrangement).

Appears in 2 contracts

Samples: Investor Rights Agreement (Westwood One Inc /De/), Investor Rights Agreement (Gores Radio Holdings, LLC)

Drag-Along Rights. (a) If, at any time prior This Section shall apply to a Qualified IPOtransfer by any Person or Persons who own or owns Securities (individually and collectively, any Investor (the a “Drag-Along SellerInitiator”) secures an irrevocable offer and who wish to acquire sell all share capital or assets Securities owned by them, and such Securities represent greater than 50% of the outstanding shares of Common Stock of the Company on an as-converted and fully-diluted basis, to a third party transferee that is not an Affiliate of the Drag-Along Initiator (a “Drag-Along SaleTransfer) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1). (b) If the Drag-Along Sale is structured as Initiator desires to engage in a sale Drag-Along Transfer, it shall give not less than 30 days’ prior written notice of Sharessuch intended transfer to the other Person or Persons party to this Agreement (the “Drag-Along Sellers”). Such notice (the “Drag-Along Notice”) shall set forth the terms and conditions of such intended transfer, each Other Investor shall sell to including the name of the intended transferee, the number of shares held by the Drag-Along Purchaser Initiator, the purchase price per share proposed to be paid therefor and the payment terms and type of transfer to be effectuated. Upon receipt of such Drag-Along Notice and only upon the approval of the holders of at least sixty-seven percent (67%) of the outstanding Preferred Stock and Common Stock issued upon conversion thereof voting together as a single class and calculated on an as-converted basis, each Drag-Along Seller shall be obligated to transfer all Shares then of the Capital Stock owned or held by it to such Other Investor on transferee (at the same price per share and upon the same terms and conditions as are applicable to the Drag-Along Seller, including Initiator). Notwithstanding anything to the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined contrary in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day periodforegoing, the Drag-Along Seller shall again comply with the procedures set forth Sellers will not be obligated to participate in this Section 9.1(e). (f) In connection with a Drag-Along Sale, Transfer unless each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as following conditions are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.satisfied:

Appears in 2 contracts

Samples: Investors’ Rights Agreement (Reata Pharmaceuticals Inc), Investors’ Rights Agreement (Reata Pharmaceuticals Inc)

Drag-Along Rights. (a) IfFor so long as Heartland is entitled to the right to designate directors as set forth in Section 6.3 of the Existing Stockholders Agreement, at any time prior to a Qualified IPO, any Investor in the event that one or more of the Heartland Entities (the "Drag-Along Seller”Rightholders") secures an irrevocable receive a bona fide offer from a Tag-Along Third Party Purchaser to acquire purchase (including a purchase by merger) all share capital or substantially all of the Shares held by the Heartland Entities or all or a substantial portion of the Common Stock or consolidated assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such PersonCompany, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Rightholders may send written notice (the "Drag-Along Sale is agreed by a majority vote of Notice") to the Company and the other Investors and Stockholders (the "Drag-Along Sellers") notifying them they will be required to sell all (but not less than all) of their Shares in such sale (or, in the case of a majority merger or asset sale, vote as stockholders in favor of the Founderssuch sale). Upon receipt of a Drag-Along Notice, each other Investor Drag-Along Seller receiving such notice shall be obligated to (an “Other Investor”i) agrees, at sell all of its Shares in the request of transaction (including a sale by merger or asset sale) contemplated by the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If Notice for the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor same consideration per Share and otherwise on the same terms and conditions as are applicable to the Drag-Along SellerRightholders (including payment of its pro rata share of all costs associated with such transaction) and (ii) otherwise take all necessary action in its capacity as a stockholder to cause the consummation of such transaction, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms voting its Shares in favor of such transaction and not exercising any appraisal rights in connection therewith. The obligations of the Drag-Along Purchaser; provided that Sellers in respect of a transaction under this Section 3.1(g) are subject to the proceeds from such sale satisfaction of any Round C Investors shall not be less than the higher of following conditions: (i) upon the Series A Liquidation Amount (as defined consummation of any such transaction, each Drag-Along Seller shall have the right to receive cash and/or other consideration in the Memorandum same form and Articles) amount per share of consideration paid to Drag-Along Rightholders in such transaction or any other transaction related thereto (such as a payment for consulting or management services or non-compete payments); (ii) the purchase price as stated in the offer of the if any Drag-Along Purchaser pro rata based on Seller is given an option as to the number form and amount of Ordinary Shares held by such Round C Investors (on an asconsideration to be received, each other Drag-converted basis); provided, further, that except Along Seller will be given the same option with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a its applicable pro rata share; and (iii) no Drag-Along Purchaser for Seller shall be obligated under the terms of any agreement respecting any transaction subject to this Section 3.1(g) to indemnify any person in an amount greater than the proceeds from to be received by such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Salesuch transaction. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 2 contracts

Samples: Stockholders Agreement (Collins & Aikman Corp), Stockholders Agreement (Heartland Industrial Partners L P)

Drag-Along Rights. If the holder(s) of at least fifty percent (a50%) If, at any time prior to a Qualified IPO, any Investor (of the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets voting power of the then issued and outstanding Shares of the Company (calculated on a fully diluted and as-converted basis) including the Founder Parties and the Series C Investors (together, the "Drag-Along Shareholders") collectively approve the sale of Shares or a Trade Sale (each, an "Approved Sale") with to a bona fide third-party potential purchaser (the "Potential Purchaser") any time after the Closing at a valuation of the Company of more than US$600,000,000 with any Person (such Personexceeding RXX 00 billion or the equivalents in other currency, a “Drag-Along Purchaser”) then upon such terms and conditions as agreed to with written notice from the Drag-Along SellerShareholders, and such Drag-Along Sale is agreed by a majority vote each of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement shareholders of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”"Dragged Shareholders") and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make vote, or give its written consent with respect to, all the Shares held by them in favor of such representations, warranties proposed Approved Sale and covenants and enter into in opposition of any proposal that could reasonably be expected to delay or impair the consummation of any such definitive agreements as are customary for transactions of the nature of the Drag-Along proposed Approved Sale, ; (ii) benefit from and be subject to sell, transfer, and/or exchange, as the case may be, all of the same provisions of the definitive agreements as are applicable their Shares in such Approved Sale to the Drag-Along Seller, such Potential Purchaser; (iii) be required refrain from exercising any dissenters' rights or rights of appraisal under applicable Law at any time with respect to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such proposed Approved Sale; and (iv) take all actions reasonably necessary to consummate the proposed Approved Sale. Upon the approval of an Approved Sale as described in this Section 5.1, each Shareholder (other than Drag-Along Sale severally; providedShareholders) shall grant to the chief executive officer (“CEO”) or an authorized officer, furthera power of attorney to transfer their Shares and to do and carry out all other necessary or advisable acts to complete the Approved Sale, that no Other Investor including, without limitation, executing any and all documents (including instruments of transfer) on behalf of such Shareholder. The CEO or an authorized officer shall be obligated authorized to indemnify transfer the Shares of each such Shareholder and to do and carry out all other necessary or advisable acts to complete the Approved Sale, including, without limitation, executing any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms documents (including customary indemnification from the Company)), instruments of transfers) on behalf of each such Shareholder. Notwithstanding any provision to the extent contrary, the share transfer restrictions of Section 3 of this Agreement shall not paid by the Company, and (v) apply to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights transfers made pursuant to which they may be entitled in connection with a Drag-Along Salethis Section 5.

Appears in 2 contracts

Samples: Shareholders Agreement (Weidai Ltd.), Shareholder Agreement (Weidai Ltd.)

Drag-Along Rights. (a) IfFor so long as the Stockholders and Management hold, at any time prior in the aggregate, greater than fifty percent (50%) of the outstanding Common Shares and one or more Sponsors agree to enter into a transaction which would result in the Transfer of greater than 50% of the Common Shares to a Qualified IPOnon-Affiliate third party (a “Drag‑Along Buyer”), any Investor such Sponsor(s) (the “Selling Stockholders”) may compel each other Stockholder and Management (together, the “Drag-Along SellerStockholders”) secures an irrevocable offer to acquire all share capital or assets of the Company sell its Common Shares by delivering written notice (a “Drag-Along SaleNotice”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along SellerStockholders stating that such Selling Stockholders wish to exercise their rights under this Section 4.05 with respect to such Transfer, and such Drag-Along Sale is agreed by a majority vote of setting forth the other Investors name and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request address of the Drag-Along SellerBuyer, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number and class(es) of Ordinary Common Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (Transferred, the “Drag-Along Sale Price”) proposed amount and form of the consideration, and all other material terms and conditions offered by the Drag-Along Buyer; provided however, that one or more Sponsors may exercise its drag-along rights hereunder with respect to Sovereign Co-Invest regardless of the amount of Common Shares to be Transferred by such Sponsor or Sponsors and provided further, that in order for one Sponsor to exercise its drag-along rights under this Section 4.05, it must receive the consent of the other Sponsor, such consent being required for so long as such other Sponsor, together with its Affiliates, beneficially owns at least 5% of the outstanding Common Shares. (b) Upon delivery of a Drag-Along Notice, each Drag-Along Stockholder shall be required to Transfer its Pro Rata Portion, on the same terms and conditions (including, without limitation, as to price, time of payment and form of consideration) as agreed by the Selling Stockholders and the Drag-Along Buyer, and shall make to the Drag-Along Buyer representations, warranties, covenants, indemnities and agreements comparable to those made by the Selling Stockholders in connection with the Transfer (other than any non-competition, non-solicitation or similar agreements or covenants that would bind the Drag-Along Stockholder, its Affiliates or any of their respective portfolio companies), and shall agree to the same conditions to the Transfer as the Selling Stockholders agree, it being understood that all such representations, warranties, covenants, indemnities and agreements shall be made by each Selling Stockholder and each Drag-Along Stockholder severally and not jointly and that, the aggregate amount of the liability of the Drag-Along Sale. Each Other Investor Stockholder shall be required not exceed, except with respect to participate in individual representations, warranties, covenants, indemnities and other agreements of the Drag-Along Sale on Stockholder as to the unencumbered title to its Common Shares and the power, authority and legal right to Transfer such Common Shares, such Drag-Along Stockholder’s pro rata share of any such liability, to be determined in accordance with such Drag-Along Stockholder’s portion of the total number of Common Shares included in such Transfer; provided that, in any event the amount of liability of any Drag-Along Stockholder shall not exceed the proceeds such Drag-Along Stockholder received in connection with such Transfer. (c) In the event that any such Transfer is structured as a merger, consolidation, or similar business combination, each Drag-Along Stockholder agrees to (i) vote in favor of the transaction, (ii) take such other action as may be required to effect such transaction (subject to Section 4.05(b)) and (iii) take all action to waive any dissenters, appraisal or other similar rights with respect thereto. (d) Solely for purposes of Section 4.05(c)(i) and in order to secure the performance of each Stockholder’s obligations under Section 4.05(c)(i), each Stockholder hereby irrevocably appoints each other Stockholder that qualifies as a Drag-Along Proxy Holder (as defined below) the attorney-in-fact and proxy of such first Stockholder (with full power of substitution) to vote or provide a written consent with respect to its Common Shares as described in this paragraph if, and only in the event that, such Stockholder fails to vote or provide a written consent with respect to its Common Shares in accordance with the terms of Section 4.05(c)(i) (each such Stockholder, a “Breaching Drag-Along Stockholder”) within three (3) days of a request for such vote or written consent. Upon such failure, the Selling Stockholders shall have and conditions are hereby irrevocably granted a proxy to vote or provide a written consent with respect to each such Breaching Drag-Along Stockholder’s Common Shares for the purposes of taking the actions required by Section 4.05(c)(i) (such Selling Stockholders each and collectively, a “Drag-Along Proxy Holder”). Each Stockholder intends this proxy to be, and it shall be, irrevocable and coupled with an interest, and each Stockholder will take such further action and execute such other instruments as may be necessary to effectuate the intent of this proxy and hereby revoke any proxy previously granted by it with respect to the matters set forth in Section 4.05(c)(i) with respect to the Drag-Along Sale Notice and to tender its SharesCommon Shares owned by such Stockholder. The price and form of consideration payable in such transfer Notwithstanding the foregoing, the conditional proxy granted by this Section 4.05(d) shall be deemed to be revoked upon the Drag-Along Sale Pricetermination of this Article IV in accordance with its terms. (e) The If any Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice Stockholder fails to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable deliver to the Drag-Along SellerBuyer the certificate or certificates evidencing Common Shares to be sold pursuant to this Section 4.05, (iii) be required the Selling Stockholders may, at their option, in addition to bear its proportionate share of any escrowsall other remedies they may have, holdbacks or adjustments in respect of deposit the purchase price (including any promissory note constituting all or indemnification obligations; provided that an Other Investor any portion thereof) for such Common Shares with any national bank or trust company having combined capital, surplus and undivided profits in excess of $100 million (the “Escrow Agent”), and the Company shall only be obligated to indemnify any other Person in connection with cancel on its books the certificate or certificates representing such Common Shares and thereupon all of such Drag-Along Sale severally; providedStockholder’s rights in and to such Common Shares shall terminate. Thereafter, further, that no Other Investor shall be obligated upon delivery to indemnify any other shareholder for any breach or misrepresentation the Company by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along SellerStockholder of the certificate or certificates evidencing such Common Shares (duly endorsed, an investment banking firm selected by or with stock powers duly endorsed, for transfer, with signature guaranteed, free and clear of any liens or encumbrances, and with any stock transfer tax stamps affixed), the Selling Stockholders shall instruct the Escrow Agent to deliver the purchase price (without any interest from the date of the closing to the date of such delivery, any such interest to accrue to the Company) to such Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleStockholder.

Appears in 2 contracts

Samples: Stockholders' Agreement, Stockholders’ Agreement (Sabre Corp)

Drag-Along Rights. (a) IfSubject to the terms and conditions of this Section 6, at any time prior and notwithstanding Section 2(b) herein, if the Trust proposes to sell seventy-five percent (75%) or more of the shares of Common Stock it then holds (the "Drag Sale Shares") to a Qualified IPObona fide unaffiliated third party or parties on an arm's length basis in a single transaction or a series of related transactions for either (i) cash or unrestricted marketable securities that are traded on a U.S. stock exchange, over the counter or on a bulletin board, or (ii) any Investor consideration so long as the third party or parties that have proposed to purchase the Drag Sale Shares shall not become the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the “Drag-Along Seller”Exchange Act), directly or indirectly, of more than fifty percent (50%) secures an irrevocable offer to acquire all share capital or assets of the common stock of the ultimate parent company of the Company (a “Drag-Along Sale”assuming the execution of all outstanding stock options, stock warrants and stock rights, and conversion of all other securities that are convertible to shares of common stock of such ultimate parent company), or if there is no such ultimate parent company, so long as such third party or parties shall not become the "beneficial owner", directly or indirectly of more than fifty percent (50%) with a valuation of the total outstanding Common Stock or Voting Stock of the Company (assuming the execution of more than US$600,000,000 with any Person (such Personall outstanding stock options, a “Drag-Along Purchaser”) upon such terms stock warrants and conditions as agreed to with the Drag-Along Sellerstock rights, and such Drag-Along Sale is agreed by a majority vote conversion of the all other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement securities of the Company that are convertible to shares of Common Stock or other transaction that requires Voting Stock), the approval of the Investors, each Investor Trust shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall be entitled to provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than Holder, at least ten (10) days prior to the closing of such sale, written notice, in accordance with Section 15 herein, of its good faith intention to sell the shares of Common Stock, the name of the proposed transferee(s) (the "Proposed Transferee"), the price and other material terms under which the sale is proposed to be made and that it is requiring the Holder to exercise all or a portion of the Warrant, if any portion remains outstanding and unexpired hereunder, and to sell the Shares obtained through such exercise, if any (the "Required Exercise Shares"), as well as a certain number of the Shares then held by the Holder to the Proposed Transferee on the terms and conditions contained therein ("Drag-Along SaleNotice"), such that the total number of Shares to be sold to the Proposed Transferee by the Holder shall be equal to: C (A + B) x ------ D where: A = the number of Shares then held by the Holder, including the Required Exercise Shares; B = the number of shares of Common Stock subject to the outstanding, unexpired portion of the Warrant (if any) below, after taking into account the exercise required with respect to the Required Exercise Shares (but excluding any portion of the Warrant that is not subject to drag-along rights pursuant to Section 6(f) below); C = the number of Drag Sale Shares; and D = the total number of shares of Common Stock then held by the Trust, subject to the limitation that if the sale price to the Proposed Transferee is less than the then current Exercise Price, (i) the Holder shall not be required to exercise any portion of the Warrant in order to sell to the Proposed Transferee the Shares that could be obtained by such exercise, in connection with the proposed sale and (ii) that portion of the Warrant which the Holder would have been required to exercise under this Section 6 in the absence of the preceding clause (i), shall immediately expire and shall be and become void and of no value. The Holder shall be required to, and shall, comply with the terms of the Drag-Along Notice as long as it is consistent with the terms of this Section 6. The Shares to be sold by the Holder to the Proposed Transferee shall be sold to the Proposed Transferee at a purchase price equal to the product of (x) the number of such Shares, and (y) the per share sale price of the shares of Common Stock proposed to be sold by the Trust to the Proposed Transferee. The Drag-Along Sale Notice shall identify be deemed to be given and served on the date that the Holder receives the Drag-Along PurchaserNotice from the Company in accordance with Section 15. (b) Notwithstanding Section 2(b) herein and subject to Section 6(i) herein, the per-Ordinary Share consideration for which Holder shall, within five (5) days of receipt of a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions Notice, deliver an Exercise Notice to the Company with respect to the Required Exercise Shares provided that the Exercise Date is deemed to occur concurrently with the consummation of the transaction which is the subject of the Drag-Along SaleNotice. Each Other Investor shall be If the Holder does not deliver the Exercise Notice within the required to participate 5-day period or delivers the Exercise Notice without the appropriate payment in cash for the exercise of the Warrant, or portion thereof, as appropriate, upon consummation of the transaction which is the subject of the Drag-Along Sale on Notice the terms and conditions set forth Holder will have been deemed to have delivered a Cashless Exercise Notice to the Company in accordance with Section 2(c) above. The Company's call rights under Section 4(a)(i) shall not apply to the Holder's exercise with respect to the Required Exercise Shares. (c) Promptly after receipt of the Drag-Along Sale Notice and Notice, the Holder shall deliver to tender its Shares. The price and form the Trust, to hold in escrow pending closing of consideration payable in such transfer shall be the transaction that is the subject of the Drag-Along Sale PriceNotice, stock certificates in its possession (if any) representing its shares of Common Stock to be transferred, properly endorsed for transfer to the Proposed Transferee. (d) The Trust shall, together with the Drag-Along Notice, provide to the Holder a fairness opinion from an independent appraiser or investment bank selected by the Trust (reasonably satisfactory to the Required Holders) regarding the transaction that is the subject of the Drag-Along Notice, provided that there shall be no such requirement if the Trust has obtained such a fairness opinion for itself with respect to the transaction that is the subject of the Drag-Along Notice. (e) The monetary value of any indemnity to be provided by the Holder to the Proposed Transferee under the terms of its sale of Shares in accordance with this Section 6 (which indemnity may also cover operational matters not the subject of the Holder's representations and warranties described in the following sentence) shall be in the same ratio to the monetary value of the indemnity provided by the Trust as the ratio of the relative value of the securities to be sold by each of the Holder and the Trust in any such sale, but in no case shall it exceed the monetary value of the consideration it receives pursuant to the terms of such sale. The Holder's representations and warranties shall be limited to enforceability, the ownership of the Shares to be transferred by such Holder, authority to transfer such Shares, that such Shares are free of liens and encumbrances as of the transfer date and other standard and customary non-operational representations and warranties. (f) If the Company has received a Put Notice from the Holder in accordance with Section 5(d) herein prior to delivery by the Trust to the Holder of a Drag-Along Seller Notice, then the Trust shall have a period not be entitled to exercise its drag-along right pursuant to Section 6(a) herein with respect to such portion of 180 days from the date Warrant that is the subject of receipt such Put Notice, unless the per share sale price in connection with the transaction that is the subject of the Drag-Along Sale Notice is greater than or equal to enter into a definitive agreement providing for the Drag-Along Sale on Put Fair Value as of the terms and conditions set forth in date of delivery of such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. Notice by the Trust. (g) If upon the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect Trust's delivery of a Drag-Along Sale after such 180Notice to the Holder there is a pending Exercise Date and/or Put Effective Date, then the corresponding Exercise Notice and the 90-day periodwaiting period under the last sentence of Section 2(b) and/or the corresponding Put Notice and the 90-day waiting period under Sections 5(f), as the Drag-Along Seller case may be, shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Salebe tolled, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature date of delivery of the Drag-Along SaleNotice (the "Drag Toll Date"), even if any such waiting period has not yet begun to run as of the date of the delivery of the Drag-Along Notice, and the Exercise Date and/or Put Effective Date, as applicable, shall be suspended, and shall only be rescheduled in accordance with Section 6(j)(i) below. The suspended Exercise Date and/or Put Effective Date, as appropriate, and the corresponding Exercise Notice or Put Notice, as appropriate, shall be cancelled if the transaction that is the subject of the Drag-Along Notice is consummated within sixty (ii60) benefit from days of the date of delivery of the Drag-Along Notice by the Trust to the Holder. (h) If the Trust delivers a Drag-Along Notice to the Holder in accordance with Section 6(a) following its delivery of a Tag-Along Notice to the Holder in accordance with Section 7(a), then such Tag-Along Notice, and any Participation Notice delivered by the Holder in connection with the Tag-Along Notice, shall be deemed cancelled and of no effect as of the date of delivery of the Drag-Along Notice to the Holder, and the Holder shall not be entitled to exercise such tag-along right. (i) Notwithstanding Section 6(b) above and subject to all the limitations of Section 2(a) above, after receiving a Drag-Along Notice, the Holder shall be entitled to deliver to the Company an Exercise Notice relating to the portion of the same provisions Warrant that is the subject of the definitive agreements as are applicable Drag-Along Notice, provided that such Exercise Notice shall only be given effect if the transaction relating to the Drag-Along Seller, Notice is terminated or is not consummated within sixty (iii60) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect days of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share date of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by delivery of the Drag-Along SellerNotice by the Trust, an investment banking firm selected and further provided that no days that have passed from the date of delivery to the Company of the Exercise Notice until the date of such termination or expiration, as appropriate (the "Drag Expiry Date"), shall be counted for purposes of the waiting period under Section 2(b). (j) If the transaction that is the subject of a Drag-Along Notice delivered by the Trust to the Holder in accordance with Section 6(a) herein (the "Drag Transaction") is terminated or is not consummated within sixty (60) days of the date of delivery of the Drag-Along Seller Notice by the Trust, then (i) notwithstanding anything contained herein to the contrary, any Exercise Date and/or Put Effective Date that was/were suspended pursuant to Section 6(g) above shall each be deemed reinstated and engagedrescheduled, on customary terms subject to the following provisions: (including customary indemnification 1) with respect to an Exercise Date, no days that have passed from the Company)Drag Toll Date until the Drag Expiry Date shall be counted for purposes of the waiting period under Section 2(b), and the corresponding election to exercise the Warrant, or portion thereof, and the corresponding Exercise Notice, shall be deemed reinstated and effective subject to the extent not paid reschedule date of the Exercise Date, to reflect the provisions of this Section 6(j)(i)(1); and (2) with respect to a Put Effective Date, the Put Effective Date shall be delayed by adding the Companynumber of days that is equal to the number of days that have passed from the Drag Toll Date until the Drag Expiry Date to the 90-day waiting period under Section 5(f), and (v) the corresponding election to put the Warrant, or portion thereof, and the corresponding Put Notice, shall be deemed reinstated and effective subject to the extent permitted by applicable Lawrescheduled date of the Put Effective Date, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a reflect the provisions of this Section 6(j)(i)(2). (ii) the Drag-Along SaleNotice shall be deemed voided. (k) The rights of the Trust under this Section 6 shall expire upon the consummation by the Company of a Qualified Public Offering.

Appears in 2 contracts

Samples: Mezzanine Warrant Agreement (Alion Science & Technology Corp), Mezzanine Warrant Agreement (Alion Science & Technology Corp)

Drag-Along Rights. (a) If, at any time prior to a Qualified IPO, any Investor (If the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets Board of Directors of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as such term is defined in the Memorandum Amended and ArticlesRestated Voting Agreement, dated as of August 20, 2010, by and among the Company and the other parties thereto (as amended from time to time, the “Voting Agreement”)) or (ii) the purchase price as stated in the offer holding at least two-thirds of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors Common Stock (determined on an as-converted basis) held by all Investors (or such other requisite group of Investors as may be established by amendments to the Voting Agreement after the date hereof) approve a transaction or series of related transactions deemed to be a “Liquidation Transaction” pursuant to the Company’s Amended and Restated Certificate of Incorporation (as amended from time to time, the “Restated Certificate”); provided, furtherParticipant agrees (i) to vote all Shares then held by Participant in favor of such Liquidation Transaction and (ii) to sell or exchange all Shares then held by Participant pursuant to the terms and conditions of such Liquidation Transaction, that except subject to the following conditions: (a) Participant shall not be required to make any representation, covenant or warranty in connection with the Liquidation Transaction more extensive in scope than those being made by the Investors; (b) the consideration payable with respect to any liability incurred by each share in each class or series of capital stock of the Company as a result of such Other Investor individually, Liquidation Transaction is the same (except for cash payments in lieu of fractional shares) as for each other share in such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale.same class or series; and (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme each class and series of arrangement capital stock of the Company or other transaction that requires will be entitled to receive the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and same form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all the same indemnity and escrow provisions) as a result of such Liquidation Transaction, provided that (i) each class or series may receive an amount per share of consideration that is greater or less than other classes or series in accordance with the Restated Certificate and (ii) individual classes or series may be subject to a greater or lesser allocation of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or aggregate indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), escrow obligations to the extent not paid by necessary to respect the Companyrelative rights of each class and series to receive proceeds upon a Liquidation Transaction, and (v) to in accordance with the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleRestated Certificate.

Appears in 2 contracts

Samples: Stock Option Agreement (Apptio Inc), Stock Option Agreement (Apptio Inc)

Drag-Along Rights. (a) IfSubject to prior compliance with Section 4.5 and Section 4.6, at any time after the third anniversary of the Closing Date, prior to the occurrence of a Qualified IPOPublic Offering, if any Drag-Along Investor Group elects to consummate a Transfer of Limited Partner Interests to any Person or Persons (the except pursuant to a Permitted Transfer, Bona Fide Pledge or Foreclosure) (collectively, a “Drag-Along SellerTransferee”) secures an irrevocable offer in a bona fide arm’s-length transaction or series of related transactions (including by way of a purchase agreement, tender offer, merger or other business combination transaction or otherwise) pursuant to acquire all share capital or assets which all, but not less than all, of the Company Limited Partner Interests and limited liability company equity interests in the General Partner, if any, held in the aggregate by such Drag-Along Investor Group would be Transferred to such Drag-Along Transferee (subject to allowance for “rollover” transactions in which the Drag-Along Investor Group and its Affiliates continue to hold no more than 20% of the equity in the General Partner and the Partnership, or their successor entity or entities, following completion of such transactions), such Drag-Along Investor Group shall have the right (a “Drag-Along Right”), upon the terms and subject to the conditions of this Section 4.9, to require all other Limited Partners to Transfer all, but not less than all, of the Limited Partner Interests held by such other Limited Partners to such Drag-Along Transferee; provided, however, that the Drag-Along Investor Group must hold at least 25% of the Units (as defined in the GP LLC Agreement) in the General Partner and at least at least 60% of the Outstanding Limited Partner Interests to exercise its Drag-Along Rights; provided, further, that such Drag-Along Investor Group must also exercise its drag-along rights under the GP LLC Agreement; and provided, further, that if all or a portion of the consideration to be received in connection with the Drag-Along Sale consists of securities of the Drag-Along Transferee or another Person, such securities must be listed on a National Securities Exchange and be (x) issued pursuant to an effective registration statement under the Securities Act or (y) subject to a demand registration rights agreement with all Limited Partners receiving such securities, on reasonable and customary terms (including mutual indemnities and piggyback registration rights) and providing for the issuer to use commercially reasonable efforts to register (upon the request of any Limited Partner) under the Securities Act the resale of all such securities received by all Limited Partners. (i) Subject to Section 4.9(b), each Limited Partner will Transfer all of the Limited Partner Interests it is required to Transfer in connection with the valid exercise of Drag-Along Rights by a Drag-Along Investor Group on the same terms (other than aggregate price) and conditions applicable to, and for the same type of consideration payable to, each member of the Drag-Along Investor Group, at the price calculated in accordance with Section 4.9(a)(ii) (a “Drag-Along Sale”); and (ii) with The aggregate purchase price payable for the Limited Partner Interests purchased by a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms Transferee will be allocated, paid and conditions as agreed to with distributed among the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate Limited Partners participating in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number Percentage Interest of Ordinary Shares held by each such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along SaleLimited Partner. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) aggregate net purchase price payable in respect of Partnership Interests and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate Units in the Drag-Along Sale on the terms and conditions set forth General Partner in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in pursuant to this Section 9.1(e)4.9 and pursuant to the GP LLC Agreement shall be allocated among such securities in the same manner as such amount would be distributed among the holders of such securities in a liquidation of the Partnership followed by a liquidation of the General Partner. (fb) In connection with a Drag-Along Sale, each Other Investor shall (i) Limited Partner subject thereto will execute such documents, and make such representations, warranties warranties, covenants and indemnities with respect to the matters set forth below, as are (and when) executed and made by the applicable Drag-Along Investor Group, and will take and cause its Affiliates to take, and cause any director designated to the Board by such Limited Partner, if applicable, to take, any and all other actions as may be reasonably necessary or advisable to consummate the Drag-Along Sale; provided, that any indemnification or similar obligations will be apportioned pro rata among the Limited Partners participating in the Drag-Along Sale based on the net proceeds received by them, other than with respect to representations and covenants made individually by a Limited Partner. In connection with a Drag-Along Sale, each Limited Partner subject thereto will also (A) consent to and enter into raise no objections against the Drag-Along Sale or the process pursuant to which the Drag-Along Sale was arranged, (B) waive any dissenter’s rights and other similar rights, (C) take all actions reasonably required or desirable or requested by the Drag-Along Investor Group to consummate such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (D) comply with the terms of the documentation relating to such Drag-Along Sale and (E) use commercially reasonable efforts to cause any director designated to the Board by such Limited Partner, if applicable, to facilitate and take, and cause the General Partner to facilitate and take, the actions described in the foregoing clauses (A) through (D). In connection with any Drag-Along Sale, no Limited Partner required to participate in such Drag-Along Sale shall be required to make any representations or warranties in connection with such Transfer, other than representations or warranties made individually by such Limited Partner as to such Limited Partner’s title to the applicable securities and the Transfer of such securities free and clear of all liens, and with respect to such Limited Partner’s existence, power and authority to effect such Transfer, the due execution and enforceability of the relevant documents against such Limited Partner, the absence of conflicts or required consents, absence of litigation with respect to such Limited Partner relating to such transaction and absence of obligations with respect to brokers’ fees. (c) The rights set forth in this Section 4.9 will be exercised by the Drag-Along Investor Group giving written notice (the “Drag-Along Notice”) to the other Limited Partners, at least thirty (30) Business Days prior to the date on which the Drag-Along Investor Group expects to consummate the Drag-Along Sale. In the event that the terms and/or conditions set forth in the Drag-Along Notice are thereafter amended in any material respect, such Drag-Along Investor Group will promptly give written notice (an “Amended Drag-Along Notice”) of the amended terms and conditions of the proposed Transfer to each of the other Limited Partners. The Drag-Along Investor Group shall cause each Drag-Along Notice and Amended Drag-Along Notice to set forth: (i) the name and address of the Drag-Along Transferee, (ii) benefit from the proposed amount and be subject to form of consideration and terms and conditions of payment offered by the Drag-Along Transferee and (iii) all other material terms of the same provisions proposed transaction, including the expected closing date of the transaction, and the Drag-Along Investor Group shall provide copies of the definitive documents and agreements as are applicable relating to the Drag-Along Seller, (iii) be required Sale to bear its proportionate share of any escrows, holdbacks or adjustments the other Limited Partners reasonably in respect advance of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with consummation of such Drag-Along Sale severallySale; provided, furtherthat any such document or agreement to which the other Limited Partners are not a party may be redacted to exclude provisions not directly relevant, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along SellerInvestor Group’s reasonable discretion, to the other Limited Partners. (d) Notwithstanding anything to the contrary in this Section 4.9, if the consideration in a Drag-Along Sale includes securities with respect to which no registration statement covering the issuance of such securities has been declared effective under the Securities Act and which may not be resold pursuant to Rule 144 (or are subject to volume limitations thereunder), each Limited Partner that is not then an investment banking firm selected by Accredited Investor (without regard to Rule 501(a)(4) under the Securities Act) may be required (notwithstanding Section 4.9(a)(i)), at the request and election of the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company))Investor Group, to (i) appoint a purchaser representative (as such term is defined in Rule 501 under the extent not paid Securities Act) reasonably acceptable to such Limited Partners or (ii) accept cash in lieu of any securities such non-Accredited Investor would otherwise receive in an amount equal to the fair market value of such securities as determined by the Company, and Board in its reasonable judgment. (ve) to If some or all of the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled consideration received in connection with a Drag-Along SaleSale is other than cash, then such consideration shall be deemed to have a dollar value equal to the fair market value of such consideration as determined by the Board; provided, that if the Board does not or is unable to make such a determination of fair market value, such determination of fair market value shall be made by a Valuation Firm selected by the Board, and such firm shall be engaged and paid by the Partnership. The determination of fair market value by such Valuation Firm (or, if such firm determines a range of fair market values, the mid-point of such range) shall be final and binding on all parties.

Appears in 2 contracts

Samples: Limited Partnership Agreement (Harbinger Group Inc.), Limited Partnership Agreement (Exco Resources Inc)

Drag-Along Rights. (a) If, at At any time prior to a Qualified the IPO, any Investor if UST (for purposes of this Section 5.2, the “Electing Holder”), determines to sell, in a single transaction or a series of related transactions, to an independent third party or parties (the “Drag-Along SellerBuyer”), greater than 25% of the Initial Shares of Common Stock held by the Electing Holder, the Electing Holder may require each of VEBA and Canada (the “Non-Electing Holders”) secures an irrevocable offer to acquire all share capital sell or assets cause to be sold up to a number of the Company (a “Drag-Along Sale”) with a valuation their shares of the Company Common Stock as of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate date in such Dragtransaction (by merger or otherwise), equal to the product (rounded up to the nearest whole number) obtained by multiplying (i) the maximum number of shares of Common Stock to be included in the contemplated sale and (ii) a fraction (A) the numerator of which is equal to the number of shares of Common Stock held by such Non-Along Sale as set forth Electing Holder and (B) the denominator of which is equal to the number of shares of Common Stock held, in this Section 9.1. (b) If the Dragaggregate, by the Electing Holder and all Non-Along Sale is structured as a sale of SharesElecting Holders, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor Buyer, for the same consideration per share of Common Stock and on the same terms and conditions as the Electing Holder, subject to the provisions of this Section 5.2 (the “Compelled Sale”) and to take such other actions with respect thereto as set forth in Section 5.2(b) below. (b) The Corporation, if instructed in writing by the Electing Holder, shall send written notice (the “Compelled Sale Notice”) of the exercise of the rights pursuant to this Section 5.2 to each of the Non-Electing Holders setting forth the consideration per share of Common Stock to be paid pursuant to the Compelled Sale and the other terms and conditions of the transaction. Each Non-Electing Holder, upon receipt of the Compelled Sale Notice, will be obligated to (i) except in the case of the VEBA, vote its shares of Common Stock in favor of such Compelled Sale at any meeting of stockholders of the Corporation called to vote on or approve such Compelled Sale (or any written consent solicited for such purpose), (ii) sell the requisite number of its shares of Common Stock, and participate in the Compelled Sale and (iii) otherwise take all necessary action, including, without limitation, expressly waiving any dissenter’s rights or rights of appraisal or similar rights, providing access to documents and records of the Corporation, entering into an agreement reflecting the terms of the Compelled Sale (although Non-Electing Holders shall not be required to provide representations, warranties and indemnities other than concerning each such Holder’s valid ownership of its shares of Common Stock free of all liens, and each such Holder’s authority, power and right to enter into and consummate the Compelled Sale without violating any other agreement), surrendering certificates or other instruments representing the shares of Common Stock, duly authorized for transfer or accompanied by a duly executed stock power, cooperating in obtaining any applicable Governmental Approval and otherwise to cause the Corporation to consummate such Compelled Sale. Any such Compelled Sale Notice may be rescinded by the Electing Holder at any time prior to the execution of any agreement with respect to a Compelled Sale by delivering written notice thereof to the Corporation and all of the Non-Electing Holders. (c) The obligations of the Non-Electing Holders pursuant to this Section 5.2 are applicable subject to the satisfaction of the following conditions: (i) in the event that the Non-Electing Holders are required to provide the representations, warranties or indemnities in connection with the Compelled Sale described in Section 5.2(b) above, then, each such Holder (A) will not be liable for more than the lesser of (x) its pro rata share of such indemnification payments (based upon the total consideration received by such Holder divided by the total consideration received by all sellers in such Compelled Sale) and (y) the total proceeds actually received by such Holder as consideration for its shares of Common Stock in such Compelled Sale, and (B) such liability shall be several and not joint with any other Person; and (ii) if any Holder is given an option as to the form and amount of consideration to be received, each other Holder shall be given the same option. (d) Each Holder shall be obligated to pay his, her or its pro rata share of the expenses incurred in connection with a consummated Compelled Sale (based upon the total consideration received by such Holder divided by the total consideration received by all sellers in such Compelled Sale) to the extent such costs are incurred for the benefit of all Holders and are not otherwise paid by the Corporation or the acquiring party (costs incurred by or on behalf of a Holder for his, her or its sole benefit will not be considered costs of the transaction hereunder). (e) If any Holder fails to sell to the Drag-Along SellerBuyer its shares of Common Stock to be sold pursuant to this Section 5.2, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided each Holder agrees that the proceeds from Board shall cause such sale shares of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed Common Stock to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable sold to the Drag-Along SellerBuyer on the Corporation’s books in consideration of the purchase price, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect and such Drag-Along Holder’s pro rata portion of the purchase price may be held in escrow, without interest, until such time as he, she or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with it takes such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of actions as the costs and expenses incurred by the Company and the Investors Board may reasonably request in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Saletransaction.

Appears in 2 contracts

Samples: Stockholders Agreement, Stockholders Agreement (General Motors Co)

Drag-Along Rights. (a) If, If at any time prior to the completion by the Company of an underwritten public offering and sale of equity securities (an “Initial Offering”) of the Company pursuant to an effective registration statement under the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder (the “Securities Act”), the holders of a Qualified IPOmajority-in-interest of the total outstanding shares of Series A common stock and Series B common stock of the Company (the “Majority Stockholders”) desire to sell more than 75% of the total outstanding number of Series A common stock and Series B common stock of the Company (the “Total Shares”) held by such Majority Stockholders, pursuant to a bona fide offer to purchase such Total Shares from any Investor individual, firm, corporation, partnership, trust, incorporated or unincorporated association, joint venture, joint stock company, limited liability company, governmental authority or other entity of any kind (a “Person”) who is not an affiliate of the transferor or transferors, as the case may be (a “Third-Party Purchaser”) (the “Drag-Along SellerSale) secures an irrevocable offer ), then such Majority Stockholders shall have the right to acquire all share capital or assets require the Purchaser to sell to such Third-Party Purchaser in connection with such sale, the percentage of the Company Shares which shall equal the corresponding percentage the Majority Stockholders propose to sell of the Total Shares held by the Majority Stockholders to such Third-Party Purchaser in connection with such sale. Such right shall be exercisable by written notice (a “Drag-Along SaleNotice”) given to the Purchaser which shall state (i) that such Majority Stockholders propose to effect the sale of all or a percentage of their Total Shares to such Third-Party Purchaser, (ii) the proposed purchase price to be paid by the Third-Party Purchaser for the Total Shares of such Majority Stockholders, and (iii) the name of the Third-Party Purchaser. The Purchaser agrees that, upon receipt of a Drag-Along Notice, the Purchaser shall be obligated to sell to such Third-Party Purchaser in connection with a valuation such sale, the percentage of the Series B common stock of the Company held by the Purchaser which shall equal the corresponding percentage the Majority Stockholders propose to sell of more than US$600,000,000 Total Shares held by the Majority Stockholders to such Third-Party Purchaser in connection with any Person (such Personsale, a “Drag-Along Purchaser”) upon such the terms and conditions as agreed of such transaction (and otherwise take all reasonably necessary action to with cause the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote consummation of the other Investors and a majority vote proposed transaction, including voting such Shares in favor of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1transaction). (b) If In the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided event that the proceeds from such sale of any Round C Investors Majority Stockholders shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to provide a Drag-Along Notice to the Purchaser for an in connection with a proposed Drag-Along Sale, the Purchaser shall prior to the closing of any such proposed Drag-Along Sale, execute any purchase agreement or other certificates, instruments and other agreements required by the Third-Party Purchaser to consummate the proposed Drag-Along Sale; provided, however, that any such purchase agreement or other certificates, instruments and other agreements shall be on terms no less favorable to the Purchaser than those executed by the Majority Stockholders with respect to the Total Shares proposed to be transferred by such Majority Stockholders in connection with such Drag-Along Sale, including without limitation, the amount greater than and form of the proceeds purchase price therefor, the provision of, and representation and warranty as to, information requested by the Third-Party Purchaser from the Majority Stockholders and the provision of requisite indemnifications from the Majority Stockholders, and at the closing of any such saleproposed Drag-Along Sale, deliver to the Majority Stockholder such instruments of transfer as shall be requested by the Third-Party Purchaser with respect to the Shares to be transferred, against receipt of the purchase price therefor. (c) If The Purchaser hereby irrevocably and unconditionally waives any rights of appraisal, dissenter’s rights or similar rights that the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller Purchaser may have in connection with the Drag-Along Sale, . The Purchaser shall cause to be irrevocably and against unconditionally waived any action or proposal such rights that may prevent, hinder or impede the consummation any affiliate of the Purchaser may have in connection with such Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale If at any time the Company proposes to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchasermerge with or consolidate into any entity or enter into an arrangement having an effect substantially similar thereto, the per-Ordinary Share consideration for which a transfer is proposed Purchaser hereby irrevocably and unconditionally agrees to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to vote all of the same provisions Shares held by the Purchaser in favor of such merger or arrangement and the definitive agreements as are applicable Purchaser hereby irrevocably and unconditionally agrees to waive any rights of appraisal, dissenter’s rights or similar rights that the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder Purchaser may have with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Salethereto.

Appears in 2 contracts

Samples: Nonqualified Stock Option Agreement, Nonqualified Stock Option Agreement (ExlService Holdings, Inc.)

Drag-Along Rights. (a) If, at any time prior to a Qualified IPO, any Investor (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Drag- Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Drag- Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 2 contracts

Samples: Investors Rights Agreement (ECMOHO LTD), Investors Rights Agreement (ECMOHO LTD)

Drag-Along Rights. (a) IfWithout limiting the other terms and conditions hereof (including Section 4.1), if at any time prior to one (1) or more Shareholders (a Qualified IPO, any Investor (the “Drag-Along Seller”) secures an irrevocable offer proposes to acquire all share capital Transfer for a cash purchase price sixty-five percent (65%) or assets more of the then Outstanding Company Shares, in a single transaction or series of related transactions that is intended to result in the sale of all of the then Outstanding Company Shares to a purchaser that is not an Affiliate of any such selling Shareholder (a “Drag-Along Sale”) with a valuation of ), then the Drag-Along Seller may elect to require the Company of more than US$600,000,000 with any Person to (such Personand if the Drag-Along Seller so elects, a the Company shall) send written notice (the “Drag-Along PurchaserNotice”) upon to all other Shareholders notifying them that they will be required to (and each of such other Shareholders shall (subject to the terms and conditions as of this Article IV) be required to) sell their shares of Company Shares and, unless otherwise agreed to with by the Drag-Along SellerSeller(s) to the extent permissible under any applicable Equity Incentive Plan, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate their Derivative Securities in such Drag-Along Sale on the same terms (including the price per share and the type of consideration to be received and receipt of the proceeds at the same time) and subject to the same conditions (except as set forth in the provisos in Section 4.5(a)), which notice may be provided by posting it to a Secure Site and notifying (or causing notification to be delivered to) each of such other Shareholders of such posting in writing. Notwithstanding any other provision of this Section 9.14.4 to the contrary, (i) any Drag-Along Sale must satisfy the applicable conditions set forth in Section 4.2 (provided that the parties hereto acknowledge and agree that Section 4.2(c) shall not apply to, and clauses (iii) and (iv) of the definition of “Prohibited Person” shall be disregarded in connection with, a Transfer pursuant to a Drag-Along Sale) and otherwise be a Permitted Transfer and (ii) in connection with any Drag-Along Sale, the rights and obligations of holders of Derivative Securities or any other equity awards issued pursuant to an Equity Incentive Plan, and the treatment of any such Derivative Securities or such other equity awards, shall be subject to the terms and conditions of the Equity Incentive Plan applicable to such Derivative Securities or such other equity awards, as applicable. The Drag-Along Seller will deliver or cause to be delivered to the Company, and the Company will deliver to all other Shareholders, copies of all transaction documents relating to the Drag-Along Sale as the same become available. (b) If In the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided event that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme sale of arrangement substantially all of the Company assets, consolidation or similar business combination, each Shareholder hereby agrees to vote in favor of the transaction (including acting by written consent, if requested) and take all action to waive any dissenters, appraisal or other transaction similar rights such Shareholder may have. Each Shareholder affirms that requires its agreement to vote for the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any such a Drag-Along Sale is given as a condition of this Agreement and all actions deemed as such is coupled with an interest and is irrevocable. This voting agreement shall remain in full force and effect throughout the time that this Section 4.4 is in effect. (c) If a Drag-Along Sale has not been consummated within one hundred and eighty (180) days following delivery of the related Drag-Along Notice (which such one hundred and eighty (180)-day period may be extended for a reasonable time not to exceed an additional ninety (90) days to the extent reasonably necessary by to obtain any necessary regulatory approvals), the Drag-Along Seller in connection with the Notice shall be null and void, each Shareholder shall be released from his, her or its obligation under such Drag-Along Sale, Notice and against any action or proposal that may prevent, hinder or impede the consummation of the it shall be necessary for a separate Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) furnished and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth provisions of this Section 4.4 separately complied with, in the Drag-Along Sale Notice and order to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in subsequently consummate such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject pursuant to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e)4.4. (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 2 contracts

Samples: Shareholder Agreement, Shareholders Agreement

Drag-Along Rights. (a) IfIf holders of a majority of the Preferred Shares exercise their redemption right set forth in Article 8.4 of the Restated Articles, at any time prior and the Redemption Closing does not occur within six (6) months from the date that the Company receives the redemption request due to no fault on the part of such holders exercising their redemption right, then such holders of a Qualified IPO, any Investor majority of the Preferred Shares (the “Drag-Along SellerShareholders”) secures shall have the right to effect a Trade Sale at a purchase price per Ordinary Share (on an irrevocable offer to acquire all share capital or assets as-converted basis) of no less than one hundred and twenty percent (120%) of the Company then effective Series D Conversion Price (a “Drag-Along Sale”) with a valuation pursuant to the terms of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.17. (b) If The Drag-Along Shareholders may, by requesting so in the Drag-Along Sale is structured Notice (as a sale of Sharesdefined below), each Other Investor shall sell to request the other Shareholders (the “Dragged Shareholders”) to, and the Dragged Shareholders, upon receiving the Drag-Along Purchaser Notice, shall (i) vote, or give their written consent with respect to, all Shares then the Equity Securities held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms them in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any proposed Drag-Along Sale and in opposition of any proposal that could reasonably be expected to delay or impair the consummation of any such proposed Drag-Along Sale; (ii) transfer all actions deemed reasonably necessary by of their Equity Securities to such purchaser as required in the Drag-Along Seller Notice; (iii) refrain from exercising any dissenters’ rights or rights of appraisal under applicable law at any time with respect to or in connection with such proposed Drag-Along Sale; (iv) take all actions reasonably necessary to consummate the proposed Drag-Along Sale, including amending the then existing memorandum and articles of association of the Company, and (v) pay their respective pro rata share of expenses incurred in connection with the Drag-Along Alone Sale, and against any action or proposal ; provided that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor Sale with respect to the Dragged Shareholders shall be required the same as those with respect to participate in the Drag-Along Sale on the terms and conditions set forth Shareholders, including percentage of equity to be included in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Saleapplicable.

Appears in 2 contracts

Samples: Shareholder Agreement (9F Inc.), Shareholder Agreement (9F Inc.)

Drag-Along Rights. (a) If, at any time prior to a Qualified IPO, any Investor In the event that holders of Series C Preferred Stock representing the Approval Threshold (the “Drag-Along SellerRequisite Investors”) secures an irrevocable offer to acquire all share capital approve either (i) a future financing transaction (“Approved Financing”) or assets (ii) a sale of the Company (a “Drag-Along Sale”) with a valuation or all or substantially all of the Company Company’s assets whether by means of more than US$600,000,000 with any Person (such Persona merger, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Sellerconsolidation or sale of stock or assets, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor or otherwise (an “Other InvestorApproved Sale, and together with an Approved Financing, an “Approved Transaction”), then (i) agreesin the case of an Approved Financing, each Series C Holder and Key Holder agrees to be present, in person or by proxy, at all meetings for the request vote thereon, to vote all shares of capital stock held by such person for and raise no objections to such Approved Financing, (ii) in the event of an Approved Sale that is structured as a merger or consolidation of the Drag-Along SellerCompany, or a sale of all or substantially all of the Company’s assets, each Series C Holder and Key Holder agrees to be present, in person or by proxy, at all meetings for the vote thereon, to participate vote all shares of capital stock held by such person for and raise no objections to such Approved Sale, and waive and refrain from exercising any dissenters rights, appraisal rights or similar rights in connection with such Drag-Along merger, consolidation or asset sale, or (ii) in the case of an Approved Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale that is structured as a sale of Sharesthe stock of the Company, each Other Investor Series C Holder and Key Holder shall agree to sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms their Preferred Stock and conditions as are applicable to the Drag-Along SellerCommon Stock, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor any stock issued upon conversion of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); providedPreferred Stock, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions approved by the Requisite Investors; provided in each case that such terms do not provide that such Series C Holders and Key Holders would receive as a result of such Approved Sale less than the amount that would be distributed to such holders in the event the proceeds of such Approved Sale of the Company were distributed in accordance with the liquidation preferences set forth in the Drag-Along Sale Notice and to tender its SharesCompany’s Restated Charter, as amended. The price Series C Holders and form of consideration payable in such transfer Key Holders shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms each take all necessary and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred desirable actions approved by the Company and the Requisite Investors in connection with the proposed transaction (whether or not consummated)consummation of an Approved Transaction, including all attorney’s fees the execution of such agreements and chargessuch instruments and other actions reasonably necessary to (i) provide the representations, all accounting fees warranties, indemnities, covenants, conditions, non-compete agreements, escrow agreements and charges other provisions and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), agreements relating to the extent not paid by the Company, such Approved Transaction and (vii) to effectuate the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Saleallocation and distribution of the aggregate consideration upon the Approved Transaction.

Appears in 2 contracts

Samples: Investor Rights Agreement (Aldagen Inc), Investor Rights Agreement (Aldagen Inc)

Drag-Along Rights. (a) IfSubject to prior compliance with Section 4.5 and Section 4.6, at any time after the third anniversary of the Closing Date, prior to the occurrence of a Qualified IPOPublic Offering, if any Drag-Along Investor Group elects to consummate a Transfer of Limited Partner Interests to any Person or Persons (the except pursuant to a Permitted Transfer, Bona Fide Pledge or Foreclosure) (collectively, a “Drag-Along SellerTransferee”) secures an irrevocable offer in a bona fide arm’s-length transaction or series of related transactions (including by way of a purchase agreement, tender offer, merger or other business combination transaction or otherwise) pursuant to acquire all share capital or assets which all, but not less than all, of the Company Limited Partner Interests and limited liability company equity interests in the General Partner, if any, held in the aggregate by such Drag-Along Investor Group would be Transferred to such Drag-Along Transferee (subject to allowance for “rollover” transactions in which the Drag-Along Investor Group and its Affiliates continue to hold no more than 20% of the equity in the General Partner and the Partnership, or their successor entity or entities, following completion of such transactions), such Drag-Along Investor Group shall have the right (a “Drag-Along Right”), upon the terms and subject to the conditions of this Section 4.9, to require all other Limited Partners to Transfer all, but not less than all, of the Limited Partner Interests held by such other Limited Partners to such Drag-Along Transferee; provided, however, that the Drag-Along Investor Group must hold at least 25% of the Units (as defined in the GP LLC Agreement) in the General Partner and at least at least 60% of the Outstanding Limited Partner Interests to exercise its Drag-Along Rights; provided, further, that such Drag-Along Investor Group must also exercise its drag-along rights under the GP LLC Agreement; and provided, further, that if all or a portion of the consideration to be received in connection with the Drag-Along Sale consists of securities of the Drag-Along Transferee or another Person, such securities must be listed on a National Securities Exchange and be (x) issued pursuant to an effective registration statement under the Securities Act or (y) subject to a demand registration rights agreement with all Limited Partners receiving such securities, on reasonable and customary terms (including mutual indemnities and piggyback registration rights) and providing for the issuer to use commercially reasonable efforts to register (upon the request of any Limited Partner) under the Securities Act the resale of all such securities received by all Limited Partners. (i) Subject to Section 4.9(b), each Limited Partner will Transfer all of the Limited Partner Interests it is required to Transfer in connection with the valid exercise of Drag-Along Rights by a Drag-Along Investor Group on the same terms (other than aggregate price) and conditions applicable to, and for the same type of consideration payable to, each member of the Drag-Along Investor Group, at the price calculated in accordance with Section 4.9(a)(ii) (a “Drag-Along Sale”); and (ii) with The aggregate purchase price payable for the Limited Partner Interests purchased by a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms Transferee will be allocated, paid and conditions as agreed to with distributed among the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate Limited Partners participating in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number Percentage Interest of Ordinary Shares held by each such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along SaleLimited Partner. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) aggregate net purchase price payable in respect of Partnership Interests and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate Units in the Drag-Along Sale on the terms and conditions set forth General Partner in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in pursuant to this Section 9.1(e)4.9 and pursuant to the GP LLC Agreement shall be allocated among such securities in the same manner as such amount would be distributed among the holders of such securities in a liquidation of the Partnership followed by a liquidation of the General Partner. (fb) In connection with a Drag-Along Sale, each Other Investor shall (i) Limited Partner subject thereto will execute such documents, and make such representations, warranties warranties, covenants and indemnities with respect to the matters set forth below, as are (and when) executed and made by the applicable Drag-Along Investor Group, and will take and cause its Affiliates to take, and cause any director designated to the Board by such Limited Partner, if applicable, to take, any and all other actions as may be reasonably necessary or advisable to consummate the Drag-Along Sale; provided, that any indemnification or similar obligations will be apportioned pro rata among the Limited Partners participating in the Drag-Along Sale based on the net proceeds received by them, other than with respect to representations and covenants made individually by a Limited Partner. In connection with a Drag-Along Sale, each Limited Partner subject thereto will also (A) consent to and enter into raise no objections against the Drag-Along Sale or the process pursuant to which the Drag-Along Sale was arranged, (B) waive any dissenter’s rights and other similar rights, (C) take all actions reasonably required or desirable or requested by the Drag-Along Investor Group to consummate such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (D) comply with the terms of the documentation relating to such Drag-Along Sale and (E) use commercially reasonable efforts to cause any director designated to the Board by such Limited Partner, if applicable, to facilitate and take, and cause the General Partner to facilitate and take, the actions described in the foregoing clauses (A) through (D). In connection with any Drag-Along Sale, no Limited Partner required to participate in such Drag-Along Sale shall be required to make any representations or warranties in connection with such Transfer, other than representations or warranties made individually by such Limited Partner as to such Limited Partner’s title to the applicable securities and the Transfer of such securities free and clear of all liens, and with respect to such Limited Partner’s existence, power and authority to effect such Transfer, the due execution and enforceability of the relevant documents against such Limited Partner, the absence of conflicts or required consents, absence of litigation with respect to such Limited Partner relating to such transaction and absence of obligations with respect to brokers’ fees. (c) The rights set forth in this Section 4.9 will be exercised by the Drag-Along Investor Group giving written notice (the “Drag-Along Notice”) to the other Limited Partners at least thirty (30) Business Days prior to the date on which the Drag-Along Investor Group expects to consummate the Drag-Along Sale. In the event that the terms and/or conditions set forth in the Drag-Along Notice are thereafter amended in any material respect, such Drag-Along Investor Group will promptly give written notice (an “Amended Drag-Along Notice”) of the amended terms and conditions of the proposed Transfer to each of the other Limited Partners. The Drag-Along Investor Group shall cause each Drag-Along Notice and Amended Drag-Along Notice to set forth: (i) the name and address of the Drag-Along Transferee, (ii) benefit from the proposed amount and be subject to form of consideration and terms and conditions of payment offered by the Drag-Along Transferee and (iii) all other material terms of the same provisions proposed transaction, including the expected closing date of the transaction, and the Drag-Along Investor Group shall provide copies of the definitive documents and agreements as are applicable relating to the Drag-Along Seller, (iii) be required Sale to bear its proportionate share of any escrows, holdbacks or adjustments the other Limited Partners reasonably in respect advance of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with consummation of such Drag-Along Sale severallySale; provided, furtherthat any such document or agreement to which the other Limited Partners are not a party may be redacted to exclude provisions not directly relevant, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along SellerInvestor Group’s reasonable discretion, to the other Limited Partners. (d) Notwithstanding anything to the contrary in this Section 4.9, if the consideration in a Drag-Along Sale includes securities with respect to which no registration statement covering the issuance of such securities has been declared effective under the Securities Act and which may not be resold pursuant to Rule 144 (or are subject to volume limitations thereunder), each Limited Partner that is not then an investment banking firm selected by Accredited Investor (without regard to Rule 501(a)(4) under the Securities Act) may be required (notwithstanding Section 4.9(a)(i)), at the request and election of the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company))Investor Group, to (i) appoint a purchaser representative (as such term is defined in Rule 501 under the extent not paid Securities Act) reasonably acceptable to such Limited Partners or (ii) accept cash in lieu of any securities such non-Accredited Investor would otherwise receive in an amount equal to the fair market value of such securities as determined by the Company, and Board in its reasonable judgment. (ve) to If some or all of the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled consideration received in connection with a Drag-Along SaleSale is other than cash, then such consideration shall be deemed to have a dollar value equal to the fair market value of such consideration as determined by the Board; provided, that if the Board does not or is unable to make such a determination of fair market value, such determination of fair market value shall be made by a Valuation Firm selected by the Board, and such firm shall be engaged and paid by the Partnership. The determination of fair market value by such Valuation Firm (or, if such firm determines a range of fair market values, the mid-point of such range) shall be final and binding on all parties.

Appears in 2 contracts

Samples: Agreement of Limited Partnership (Harbinger Group Inc.), Limited Partnership Agreement (Exco Resources Inc)

Drag-Along Rights. (a) IfIn the event that the stockholders holding a majority of the outstanding shares of the Company’s Common Stock desire to consummate a “Sale of the Company” (as defined below), at any time then prior to consummation of such Sale of the Company, the stockholder or group of stockholders initiating the Sale of the Company (each a Qualified IPO, any Investor (the “Drag-Along Seller”) secures an irrevocable offer shall deliver written notice (in accordance with Section 4.3(e)) to acquire all share capital or assets the other non-initiating stockholders (the “Non-Initiating Drag-Along Sellers”, and together with the Drag-Along Sellers, the “Sellers” and each a “Seller”) notifying such Non-Initiating Drag-Along Sellers that they will be required to participate in such Sale of the Company on the same terms and subject to the same conditions as the Drag-Along Sellers and otherwise comply with the terms of this Section 4.3 (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person), a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing received for the Drag-Along Sale on (i) must be entirely for cash and/or marketable securities and (ii) must be for a price per share not less than the terms purchase price per share paid by the Investor under this Agreement (adjusted appropriately in the event of any forward or reverse stock split, stock dividend or recapitalization, reorganization, reclassification, combination, exchange of shares or other similar exchange with respect to the Common Stock, other than pursuant to the Amended and conditions set forth in such DragRestated Certificate of Incorporation of the Company) (the “Per Share Purchase Price”). Upon the consummation of the Sale of the Company, each Non-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Initiating Drag-Along Seller shall again comply with be entitled to receive the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions same proportion of the nature aggregate consideration from such Sale of the Company that the Drag-Along Sale, (ii) benefit from and be subject Sellers are entitled to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Salereceive.

Appears in 2 contracts

Samples: Investment Agreement (Kidpik Corp.), Investment Agreement (Kidpik Corp.)

Drag-Along Rights. 12.1 If the Founders (aprovided that the Founders’ right under this Section 12 shall terminate if (A) Ifthe Founders cease to collectively hold a majority of the Ordinary Shares that they hold as of the date of the Closing, (B) Founder I resigns from the position as the chief executive officer of the Company, or (C) Founder I is involuntarily terminated or dismissed as the chief executive officer of the Company for Cause or Leave/Disability) and the Majority Holders approved a Drag-Along Sale Event (as defined below), then the Majority Holders and the Founders (each a “Drag-Along Holder”) may, at any time prior to their option, by delivery of a Qualified IPO, any Investor written notice (the “Drag-Along SellerNotice) secures an irrevocable offer to acquire all share capital or assets ), require each of the other holders of Equity Securities of the Company (each a “Dragged Holder”) to, and whereupon each Dragged Holder shall: (i) sell, together with such Drag-Along Holder, to the bona fide purchaser(s) as referred to in Section 12.2 below (an “Offeror”) (a) all of the Equity Securities held by such Dragged Holder if the Drag-Along Holder sells all of the Equity Securities held by it; or (b) a percentage of its Equity Securities equal to the percentage of the Equity Securities held by such Drag-Along Holder and proposed to be sold in the Trade Sale as referred to in Section 12.2 below (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person), a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, in each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor case on the same terms and conditions as are applicable agreed to by the Drag-Along SellerHolder; (ii) vote, including the same per-share consideration or give its written consent with respect to a specific class to, all of Shares, and shall execute the necessary transfer forms its Equity Securities in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher Sale, and in opposition of (ia) any proposal that may reasonably be expected to delay, restrict, impair or otherwise adversely affect the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer consummation of the Drag-Along Purchaser pro rata based on Sale and (b) any action or agreement that would result in a breach of any covenant, representation or warranty or any other obligation or agreement of the number Company under the definitive agreement(s) related to such Drag-Along Sale or that will result in any of Ordinary Shares held the conditions to the closing obligations under such agreement(s) not being fulfilled, and, in connection therewith, to be present (in person or by such Round C Investors proxy) at all relevant meetings of the shareholders of the Company (on an as-converted basis); provided, further, that except or adjournments thereof) or to approve and execute all relevant written consents in lieu of a meeting; (iii) refrain from exercising any dissenters’ or rights of appraisal under applicable Laws with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a the Drag-Along Purchaser for an amount greater than the proceeds from such sale.Sale; (civ) If take all necessary actions in connection with the consummation of the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary requested by the Drag-Along Seller Holders, including but not limited to the execution and delivery of any share transfer or other agreements prepared in connection with the Drag-Along SaleSale (provided however that (a) pursuant to the relevant transaction documents, liability of shareholders for indemnity is several and not joint and the liability of each shareholder is capped at the amount of consideration received and (b) the shareholders shall not be required to sign up to any non-compete, non-solicitation, general release (other than in its capacity as a shareholder) or other commercial agreements in connection with the acquisition)), and against any action or proposal that may preventthe delivery, hinder or impede at the consummation of the Drag-Along Sale.Sale involving a sale of Shares, of all certificates representing Shares held or Controlled by such Dragged Holder, duly endorsed for transfer or accompanied by a duly executed share transfer form, or affidavits and indemnity undertakings with respect to lost certificates; and (dv) The restructure such Drag-Along Seller shall provide written notice of a proposed Sale, as and if reasonably requested by the Drag-Along Sale to Holders, as a merger, consolidation, restructuring or similar transaction, or a sale of all or substantially all of the Other Investors (assets of the Company, or otherwise. 12.2 For the purpose of Section 12.1, a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Event” shall mean a Deemed Liquidation Event or Trade Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which with a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions valuation of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form Group of consideration payable in such transfer shall be the Drag-Along Sale Pricenot less than US$3,000,000,000. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 2 contracts

Samples: Shareholder Agreement (DouYu International Holdings LTD), Shareholder Agreement (DouYu International Holdings LTD)

Drag-Along Rights. Subject to the other provisions of this Agreement, if the holder(s) holding at least 77% of the Series A Preferred Shares, the holder(s) holding two thirds of the then issued and outstanding Series B Preferred Shares, the holder(s) holding two thirds of the then issued and outstanding Series B-1 Preferred Shares, the holder(s) holding a majority of the then-issued and outstanding Series C Preferred Shares, the holder(s) holding two thirds of the then issued and outstanding Series D and Series D-1 Preferred Shares (a) Ifcollectively, at any time prior to a Qualified IPO, any Investor (the “Drag-Along SellerShareholder) secures an irrevocable offer ), at any time after June 30, 2020 where the Company fails to acquire all share capital complete a Qualified IPO or assets the shareholders of the Company (other than the Series A Investors, the Series B Investors, the Series B-1 Investors, the Series C Investors, the Series D Investors and the Series D-1 Investor) do not agree to the IPO (either by action or omission), approve a sale or transfer of all or part of the assets or Equity Securities of the Company to a third party based on a pre-money valuation of the Company equal to or more than US$900,000,000 (each, a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with ), then, in any Person (such Personevent, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with written notice from the Drag-Along SellerShareholder requesting them to do so, and such Drag-Along Sale is agreed by a majority vote each of the other Investors and a majority vote shareholders of the Founders, each other Investor Company (an the Other InvestorDragged Shareholders”) agreesshall vote, at or give its written consent with respect to, all the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then Equity Securities held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms them in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any proposed Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against opposition of any action or proposal that may prevent, hinder could reasonably be expected to delay or impede impair the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to any such proposed Drag-Along Sale. The , provided that the Dragged Shareholders who do not agree on the Drag-Along Sale Notice shall identify be obligated to purchase, upon the request by any of the Series A Investors, the Series B Investors, the Series B-1 Investors, the Series C Investors, the Series D and Series D-1 Investor, all of the equity interest held by such Series A Investor, Series B Investor, the Series B-1 Investors, the Series C Investor, the Series D Investors or the Series D-1 Investor, at the same price as the aforesaid third party have offered, and if such dissenting Dragged Shareholder(s) cannot purchase the equity interest to be sold by the said Series A Investor, Series B Investor, the Series B-1 Investors, the Series C Investor, the Series D Investors or the Series D-1 Investor immediately, he/she/it shall be deemed to have agreed to the Drag-Along Purchaser, Sale and shall take all necessary actions to make the per-Ordinary Share consideration for which a transfer is proposed director appointed by he/she/it (if applicable) to be made (adopt the “Drag-Along Sale Price”) and all other material terms and conditions of board resolution approving the Drag-Along Sale. Each Other Investor shall be required Notwithstanding any provision to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day periodcontrary, the Drag-Along Seller share transfer restrictions of Section 9 of this Agreement shall again comply with the procedures set forth in not apply to any transfers made pursuant to this Section 9.1(e)12. (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 2 contracts

Samples: Shareholder Agreement (CooTek(Cayman)Inc.), Shareholder Agreements (CooTek(Cayman)Inc.)

Drag-Along Rights. (a) IfIn the event that the Board of Directors of the Company and the holders of at least two-thirds of the outstanding shares of the Company’s Series I Preferred Stock (the “Series I Supermajority Holders”) vote to approve or otherwise enter into a transaction with another entity (the “Purchasing Entity”) that would qualify as a Company Sale (as defined in Section 5 below), at any time prior then the Series I Supermajority Holders shall have the right to require all other Investors to vote in favor of, consent to and raise no objection to such Company Sale, and if such right is exercised pursuant to this Section 1, each holder of the Company’s capital stock hereto hereby agrees to vote all of the shares of the Company’s capital stock held by such holder in favor of such Company Sale. (b) In the event that the Board of Directors and the Series I Supermajority Holders vote to approve or otherwise enter into a Qualified IPO, any Investor transaction with another entity that would qualify as a Company Sale (such Series I Supermajority Holders are referred to herein as the “Drag-Along SellerRights Holders) secures an irrevocable offer to acquire all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person), a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote Rights Holders shall have the right to require all other Investors to sell or transfer all of their capital stock of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, Company to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor unaffiliated purchaser on the same terms and conditions applicable, and for the same type and amount of consideration payable, to such Drag-Along Rights Holders as are applicable determined on a pro rata basis (treating all convertible securities as fully converted into Common Stock for purposes of calculating such Investor’s pro rata share); provided, however, that the aggregate proceeds from such sale or sales shall be distributed to the selling holders (including holders selling due to the exercise of the rights set forth in this Section 1(b)) in accordance with the rights and preferences set forth in, and assuming the Company had been liquidated under the appropriate provisions of, the Amended and Restated Certificate of Incorporation (as amended from time to time). In the event the Drag-Along SellerRights Holders agree to any Company Sale and elect to require all other Investors to sell or transfer their capital stock pursuant to this Section 1(b), including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that Rights Holders shall notify the proceeds from other Investors of such sale proposed Company Sale (the “Drag Notice”) at least thirty (30) days prior to the consummation of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such saleproposed Company Sale. (c) If The Drag Notice shall set forth (a) a summary description of the form of the proposed Company Sale, (b) the name of the proposed purchaser and (c) the proposed amount and form of consideration and terms and conditions of payment offered by the proposed purchaser, including copies of any terms sheet or letter of intent with respect to the proposed Company Sale. Within twenty (20) days after receipt of the Drag Notice, the Investors (other than the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor Rights Holders) shall vote its respective Shares (or execute take all necessary and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all reasonably desirable actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. proposed Company Sale described in the Drag Notice, including, without limitation, (da) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale executing and delivering agreements and instruments reasonably satisfactory in form and substance to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period purchaser and the Drag-Along Seller proposes Rights Holders, as may be reasonably necessary to effect a Drag-Along Sale after provide the representations, warranties, indemnities, covenants, conditions, escrow agreements and other provisions and agreements relating to such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Company Sale, each Other Investor shall and (ib) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions appointing the Chief Executive Officer of the nature Company as attorney and agent of the Drag-Along Sale, (ii) benefit from such Investors to execute and/or deliver any and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person instruments on their behalf in connection with such Drag-Along Sale severallyCompany Sale, subject only to the satisfaction by the third party of its obligations to consummate the proposed Company Sale; provided, furtherhowever, that no Other Investor compelled to take any action contemplated by this Section 1(c) shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share (A) make any representations or warranties regarding the Company, (B) incur any indemnification obligation or other contractual liability in excess of the costs and expenses incurred amount of consideration to be received by the Company and the Investors such Investor in connection with the proposed transaction Company Sale, or (whether C) incur any indemnification obligation or not consummated), including other contractual liability in excess of such Investor’s pro-rata share of such obligation or liability with all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Saleother Investors.

Appears in 2 contracts

Samples: Restricted Stock Purchase Agreement (TherOx, Inc.), Stock Option Agreement (TherOx, Inc.)

Drag-Along Rights. (a) If, If at any time prior to a Qualified IPO, any Investor the Shareholders holding fifty percent or more of the Company's then outstanding shares of capital stock (the "DAR Selling Shareholders(s)") shall propose to undertake a sale of fifty percent (50%) or more of the Company's then issued and outstanding shares of capital stock to an unaffiliated third party or group in a single transaction or series of related transactions (a "Proposed Drag-Along Seller”) secures an irrevocable offer to acquire Transaction"), then each Shareholder shall, if requested by such DAR Selling Shareholder(s), sell all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate its Shares in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor transaction on the same terms and conditions as are applicable to for the same per Share consideration. Such DAR Selling Shareholder(s) shall give each other Shareholder written notice ("Drag-Along Seller, including the same per-share consideration with respect to a specific class Notice") of Shares, and shall execute the necessary transfer forms in favor of the any Proposed Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of Transaction at least twenty (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (1020) days prior to the date on which such proposed Proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor Transaction shall be required to participate in the Drag-Along Sale on consummated, including the terms and conditions set forth in the Drag-Along Sale Notice thereof, and to tender its Shares. The price and form of consideration payable in each such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller other Shareholder shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice obligation to enter into a definitive agreement providing for the Drag-Along Sale sell its Shares on the such same terms and conditions in accordance with the instructions set forth in such Drag-Along Sale Notice. In such event, which Drag-Along Sale each Shareholder shall be promptly consummated, subject deliver the Share certificate(s) (accompanied by duly executed stock powers or other instrument of transfer duly endorsed in blank) representing the Shares to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing Company or to an agent designated by the Company for the Drag-Along Sale within such 180-day period purpose of effectuating the transfer of the Shares to the purchaser and the Drag-Along Seller proposes disbursement of the proceeds of such transactions to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(eShareholder(s). (fb) In connection with Without limiting the generality of the foregoing, if the DAR Shareholders approve a Drag-Along sale (an "Approved Sale") structured as a merger or a consolidation or a sale of assets, then each Other Investor shall Shareholder shall, if requested by the Company (i) make vote for, consent to and/or not raise objections against such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Approved Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable waive (to the Drag-Along Sellerextent applicable) any dissenters, appraisal rights or similar rights in connection with a merger or consolidation, and (iii) take all necessary and desirable actions in connection with the consummation of the Approved Sale as reasonably requested by the Company, including, without limitation, exercising any warrants or conversion privileges. (c) Any Shareholder required by the provisions of this Article II to transfer Shares shall not be required to bear its proportionate share of make any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person representations and warranties in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated transfer or sale except as to indemnify any other shareholder for any breach or misrepresentation by such other shareholder good title and the absence of liens with respect to title in such Shares, the corporate or other shareholder’s equity securitiesexistence of the Shareholder and the authority, (iv) form, validity and binding effect of, and the absence of any conflicts under the charter documents and material agreements of such Shareholder. No such Shareholder shall be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors provide any indemnity in connection with such Approved Sale except for indemnities for damages resulting from a breach of the proposed transaction (whether or not consummated), including all attorney’s fees above-stated representations and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Salewarranties.

Appears in 2 contracts

Samples: Shareholders' Agreement (Neogenomics Inc), Shareholders' Agreement (Neogenomics Inc)

Drag-Along Rights. (a) IfSubject to the approval rights of the holders of Series C Shares, at any time prior to a Qualified IPOSeries C-1 Shares, any Investor Series C-2 Shares and Series D Shares as set forth in the Charter, in the event that holders representing more than fifty percent (50%) of the then issued Shares on an as converted basis (the “Drag-Along Seller”) secures an irrevocable offer wish to acquire Transfer in a bona fide arm’s length transaction or series of transactions all share capital or assets of the Company Shares then owned by the Drag-Along Seller to any Person who is not an Affiliate of any Shareholders (the “Proposed Transferee”), the Drag-Along Seller shall have the right (the “Drag-Along Right”) to require all of the other Shareholders (the “Other Shareholders”) to sell to the Proposed Transferee all, and not only part, of the Shares then owned by such Shareholders (such transaction referred to in this Agreement as a “Drag-Along Sale”) with a valuation of on the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such same terms and conditions as agreed the Drag-Along Sale, except as provided in Section 3.3(a). (b) As part of a Drag-Along Sale, the Drag-Along Seller shall also have the right to require that all of the Other Shareholders that hold warrants, options or other Company Securities that are convertible into or exchangeable or exercisable for Shares shall be exercised, exchanged or converted into Shares immediately prior to the consummation of the Drag-Along Sale and the Shares issued upon such exercise, exchange or conversion shall be included in the Drag-Along Sale. Management Shareholders that hold options or warrants the exercise price per share of which is greater than the per share price at which the Shares are to be Transferred in connection with the Drag-Along SellerSale, and such Drag-Along Sale is agreed if required by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along SellerSeller to exercise such options, may, in place of such exercise, submit to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) irrevocable cancellation thereof without any liability for payment of any exercise price with respect thereto. If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except consummated with respect to any liability incurred by Shares acquired upon exercise of such Other Investor individuallyoptions or warrants, such Other Investor options or warrants shall be deemed not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such salehave been exercised or canceled, as applicable. (c) If The pricing of the Shares to be sold in a Drag-Along Sale is structured shall be as a merger, amalgamation set forth in Section 3.3(a). (d) Each Other Shareholder agrees with respect to all Company Securities that it holds or scheme of arrangement of over which such Shareholder otherwise exercises dispositive power: (1) in the Company or other transaction that event such Drag-Along Sale requires the approval of shareholders (including in the Investorscase of a merger or sale or exclusive license of all or substantially of the all of the assets of the Company) and the matter is to be brought to a vote at a shareholder meeting, each Investor shall to be present, in person or by proxy, as a holder of Company Securities, at all such meetings and be counted for the purposes of determining the presence of a quorum at such meetings; and to vote its respective Shares or cause to be voted (or execute and deliver any written consents in lieu thereof) all Company Securities in favor of any such Drag-Along Sale and in opposition of any and all actions deemed other proposals that could reasonably necessary be expected to delay or impair the ability of the Company to consummate such Drag-Along Sale if so requested by the Drag-Along Seller; (2) in the event that the Drag-Along Sale is to be effected by the sale of Shares held by the Drag-Along Seller without the need for shareholder approval, each Other Shareholder agrees to sell all Company Securities of the Company held by such Other Shareholder to the Proposed Transferee, for per-share consideration determined in connection accordance with the provisions of Section 3.3(a) and otherwise on the same terms and conditions as the Drag-Along Seller; (3) to the extent permitted by applicable law, to refrain from exercising any dissenters’ rights or rights of appraisal under applicable law at any time with respect to such Drag-Along Sale, provided it is conducted in accordance with this Section 3.2; (4) subject to Section 3.3(b), to execute and against deliver all related documentation and take such other action in support of the Drag-Along Sale as shall be reasonably requested by the Company or the Drag-Along Seller and is required of all other Shareholders; and (5) not to deposit, and to cause their Affiliates not to deposit, any action voting securities owned by such party in a voting trust or proposal that may preventsubject any such voting securities to any arrangement or agreement with respect to the voting of such shares of capital stock, hinder unless specifically requested to do so by the acquiror in connection with a Drag-Along Sale. (e) If an Other Shareholder (other than any Fidelity Investor and their respective Affiliates) fails or impede refuses to vote or sell his, her or its Company Securities as required by, or votes his, her or its Company Securities in contravention of this Section 3.2, then such Other Shareholder (other than any Fidelity Investor and their respective Affiliates) hereby grants to the Drag-Along Seller a proxy coupled with an interest to vote such Shares in accordance with this Section 3.2, and hereby appoints the Drag- Along Seller as his, her or its attorney in fact, to execute and deliver in the name and on behalf of such Other Shareholder all such agreements, instruments and other documentation (including any written consents of shareholders) as are required to Transfer the Company Securities held by such Other Shareholder to the Proposed Transferee in accordance with the terms of this Section 3.2. (f) To exercise a Drag-Along Right, the Drag-Along Seller shall give each Other Shareholder a written notice, whether before or after the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice Sale and/or the approval of a proposed the Drag-Along Sale to of the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify requisite stockholders of the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made Company (the “Drag-Along Notice”). If the Drag-Along Notice is provided after the execution of definitive agreements with respect to the Drag-Along Sale Price”and/or the approval of the Drag-Along Sale of the requisite stockholders of the Company, each Other Shareholder shall nonetheless comply with the provisions of this Section 3.2 and Section 3.3. The Drag-Along Notice shall identify (i) the name and all address of the Proposed Transferee, and (ii) the proposed purchase price, terms of payment and other material terms and conditions of the Proposed Transferee’s offer. Each Other Shareholder shall thereafter be obligated to sell its Company Securities subject to such Drag-Along Sale. Each Notice. (g) Not later than five (5) days after receipt of the Drag-Along Notice (the “Drag-Along Notice Period”), each of the Other Investor Shareholders shall be required deliver to participate a representative of the Drag-Along Seller designated in the Drag-Along Sale on Notice the terms certificate and conditions set forth other applicable instruments representing the Company Securities of such Other Shareholder to be included in the Drag-Along Sale Notice and Sale, together with wire transfer instructions for payment of the cash portion of the consideration to tender its Shares. The price and form of consideration payable be received in such transfer shall be Drag-Along Sale, or, if such delivery is not permitted by applicable law, an unconditional agreement to deliver such Company Securities pursuant to this Section 3.2(g) at the closing for such Drag-Along Sale against delivery to such Other Shareholder of the consideration therefor. If an Other Shareholder should fail to deliver such certificates to the representative of the Drag-Along Seller and the Drag-Along Sale Priceis consummated, the Company shall cause the books and records of the Company to reflect that such Company Securities are bound by the provisions of this Section 3.2 and that such Company Securities shall be Transferred to the Proposed Transferee immediately upon surrender for Transfer by the holder thereof. (eh) The Drag-Along Seller shall have a period of 180 120 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for consummate the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice; provided, which that if such Drag-Along Sale is subject to regulatory approval, such 120-day period shall be promptly consummatedextended until the expiration of five (5) Business Days after all such approvals have been received, subject to fulfilling any closing conditions and obtaining any required regulatory approvalsbut in no event later than 180 days after the date of receipt of the Drag-Along Notice. If the Drag-Along Seller has Sale shall not entered into a definitive agreement providing for the Drag-Along Sale within have been consummated during such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply promptly return to each of the Other Shareholders all certificates and other applicable instruments representing Company Securities that such Other Shareholders delivered for Transfer pursuant hereto, together with any other documents in the procedures set forth possession of the Drag-Along Seller executed by the Other Shareholders in connection with such proposed Transfer, and all the restrictions on Transfer contained in this Section 9.1(e)Agreement or otherwise applicable at such time with respect to such Company Securities owned by the Other Shareholders shall again be in effect. (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of Concurrently with the nature consummation of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along SellerSeller shall give notice thereof to the Other Shareholders, (iii) shall remit or cause to be required remitted to bear its proportionate share of any escrows, holdbacks or adjustments in respect each of the purchase price or indemnification obligations; provided Other Shareholders that an Other Investor shall only has surrendered its certificates and other applicable instruments the total consideration to be obligated to indemnify any other Person in connection with such paid at the closing of the Drag-Along Sale severally; provided(the cash portion of which is to be paid by wire transfer of immediately available funds in accordance with such Other Shareholder’s wire transfer instructions) for the Company Securities Transferred by such Other Shareholder pursuant hereto, furtherand 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 Other Shareholders. (j) Notwithstanding anything contained in this Section 3.2, that no Other Investor there shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share no liability on the part of the costs Drag-Along Seller to the Other Shareholders (other than the obligation to return the certificates and expenses incurred by the other applicable instruments representing Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested Securities received by the Drag-Along Seller) if the Transfer of Company Securities pursuant to this Section 3.2 is not consummated for whatever reason, an investment banking firm selected regardless of whether the Drag-Along Seller has delivered a Drag-Along Notice. The decision to effect a Transfer of Company Securities pursuant to this Section 3.2 by the Drag-Along Seller is in the sole and engaged, on customary terms (including customary indemnification from absolute discretion of the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleSeller.

Appears in 2 contracts

Samples: Shareholders Agreement (OptiNose, Inc.), Shareholders Agreement (OptiNose, Inc.)

Drag-Along Rights. (a) If, at any time prior to In the event of a Qualified IPO, any Investor proposed bona-fide and arm’s-length sale of all of the issued and outstanding Company Shares or Bank Shares (the “Drag-Along SellerShares”) secures held by Itaú Parent, Company One and each of their Permitted Transferees (collectively, the “Dragging Shareholder”) to any Person other than an irrevocable offer to acquire Affiliate of any Dragging Shareholder, and if at such time the Dragged Shareholder shall own less than 10% On An Adjusted Basis of all share capital or assets of the issued and outstanding Bank Shares, then the Dragging Shareholder may deliver to Company Two, Corp Group Parent and its Permitted Transferees (a collectively, the Drag-Along SaleDragged Shareholder”) with a written notice (the “Required Transfer Notice”) of such proposed sale (the “Required Transfer”), which notice shall state (i) the name of the proposed Transferee, (ii) the proposed purchase price (which shall provide that the aggregate valuation of the Company Chilean Bank is at least equal to the higher of more than US$600,000,000 with (x) its Fair Value and (y) the product of the Market Price multiplied by the number of Bank Shares outstanding in each case as of the date of the Required Transfer Notice), (iii) the obligation of the Transferee to purchase all of the Dragged Shareholder Shares, and (iv) any Person (such Person, a “Drag-Along Purchaser”) upon such other material terms and conditions as agreed of the Required Transfer, including the Required Transfer date (which date may not be less than thirty (30) days after delivery of the Required Transfer Notice). Such notice shall be accompanied by (A) a written offer from the proposed Transferee to with purchase all the Drag-Along SellerCompany Shares or Bank Shares owned by the Companies and the Shareholders, and such Drag-Along Sale is agreed by a majority vote (B) copies of all transaction documents relating to the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1Required Transfer. (b) If The Dragged Shareholder shall be obligated to sell either all of its Company Shares or all of its Bank Shares (at the Drag-Along Sale is structured as a sale Dragged Shareholder’s option in its sole discretion), free and clear of Shares, each Other Investor shall sell liens pursuant to the Drag-Along Purchaser all Shares then held by such Other Investor on Required Transfer at the same price and on other terms and conditions as are applicable no less favorable to the Drag-Along Seller, including Dragged Shareholder than the same per-share consideration with respect Dragging Shareholder; to a specific class of Shares, and shall execute participate in the necessary transfer forms Required Transfer; to vote any voting Company Shares or Bank Shares in favor of the Drag-Along PurchaserRequired Transfer at any meeting of shareholders called to vote on or approve the Required Transfer and/or to consent in writing to the Required Transfer; to use its reasonable best efforts to cause its designated Directors to vote in favor of the Required Transfer at any meeting of the Board called to vote on or approve the Required Transfer and/or to consent in writing to the Required Transfer; to waive all dissenters’ or appraisal rights in connection with the Required Transfer, if any; to enter into agreements relating to the Required Transfer, if any; and to agree (as to itself) to make to the proposed Transferee the same representations, warranties, covenants and agreements as the Dragging Shareholder agrees to make in connection with the Required Transfer; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) any representations, warranties, covenants, indemnities and other agreements shall be made severally and not jointly and shall not extend beyond representations or warranties relating to unencumbered title to its Company Shares or Bank Shares and its legal authority and capacity to enter into and perform the Series A Liquidation Amount (as defined in the Memorandum transaction documents; provided that each Shareholder will be responsible for its pro rata share of any escrow or holdback arrangement, and Articles) or (ii) the purchase price Dragged Shareholder shall not be obligated to enter into any non-competition covenant. If either Company or any Shareholders are given an option as stated in to the offer form and amount of consideration to be received, each Company and all Shareholders will be given the Dragsame option. Unless otherwise agreed by each Shareholder, any non-Along Purchaser cash consideration shall be allocated among each Company and Shareholders pro rata based on upon the number aggregate amount of Ordinary Shares held consideration to be received by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such saleCompany and Shareholders. (c) If the Drag-Along Sale Dragged Shareholder elects to Transfer Bank Shares pursuant to this Section 3.5, and such Transfer is structured not made through a tender offer launched by the proposed Transferee, it shall place an order on the Xxxxxxxx Stock Exchange to sell the respective Bank Shares, and the proposed Transferee shall place an order to buy such Bank Shares at a price not less than the proposed purchase price set forth in the Required Transfer Notice; provided that (1) any such sale of Bank Shares shall be implemented through one of the mechanisms available on the Xxxxxxxx Stock Exchange that only allows block sales (and, if both the Dragged Shareholder and the Dragging Shareholder have elected to sell Bank Shares through the Xxxxxxxx Stock Exchange, all such sales shall be combined as a mergersingle block sale), amalgamation or scheme of arrangement and (2) if, as a result of the Company or other transaction that requires the approval competitive bidding procedures of the InvestorsXxxxxxxx Stock Exchange, each Investor shall vote its respective the Bank Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary sold by the Drag-Along Seller in connection with Dragged Shareholder pursuant to this Section 3.5 are unexpectedly sold over the Drag-Along SaleXxxxxxxx Stock Exchange to a Third Party other than the proposed Transferee, and against any action or proposal that may prevent, hinder or impede then the consummation of the Drag-Along SaleDragged Shareholder shall have no further obligation under this Section 3.5. (d) The Drag-Along Seller Any expenses incurred for the benefit of the Companies and all Shareholders in relation to a Required Transfer pursuant to this Section 3.5 shall provide written notice be paid by the Shareholders in accordance with their respective pro rata portion of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed Bank Shares to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms Transferred (including customary indemnification from the Company)), any Bank Shares Transferred indirectly through a Transfer of Company Shares) to the extent not paid or reimbursed by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleTransferee.

Appears in 2 contracts

Samples: Shareholder Agreement, Transaction Agreement (Corpbanca/Fi)

Drag-Along Rights. (a) IfIf (A) the Founder Parties propose to Transfer Founder Offered Shares in an amount equal to the greater of (1) a number of shares that represents a majority of the Class B Stock then Beneficially Owned by all Founders and their Permitted Transferees or (2) a number of shares that, at any time prior when taken together with all shares of Class B Stock previously Transferred to Persons other than Permitted Transferees or the Liberty Parties, represents a majority of the Class B Stock Beneficially Owned by the Founders and their Permitted Transferees as of the date hereof, in either case, pursuant to a Qualified IPOFounder Offer Notice or Founder Offer Notices delivered in accordance with Section 5, any Investor (B) the Liberty Parties fail to purchase such Founder Offered Shares and (C) the Founder Parties propose to Transfer such Founder Offered Shares to an unaffiliated third party that is not a Permitted Transferee, then the Controlling Principals may deliver a notice (a "Drag-Along Seller”Notice") secures an irrevocable offer to acquire all the Liberty Parties setting forth (w) the number of shares of Class B Stock proposed to be Transferred (which shall be the same as the number of Subject Shares subject to the applicable Founder Offer Notice), (x) the price per share capital at which the shares of Class B Stock are proposed to be Transferred (which shall be equal to or assets of greater than the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as price per share set forth in this Section 9.1the applicable Founder Offer Notice), (y) all Liens and Restrictions to which the shares of Class B Stock proposed to be Transferred will be subject, and (z) whether the Class B Stock proposed to be Transferred is to be sold for cash or other consideration and the other terms of the proposed Transfer. (b) If the Upon receipt of a Drag-Along Sale is structured as a sale of SharesNotice, each Other Investor shall sell the Liberty Parties will be required to Transfer to the Drag-Along Purchaser all Shares then held by such Other Investor on proposed transferee, at the same terms and conditions as are applicable to the Drag-Along SellerLiberty Parties' election, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) all shares of Class B Stock and Class C Stock Beneficially Owned by the Series A Liquidation Amount (Liberty Parties as defined in the Memorandum and Articles) or to which they have dispositive power, (ii) all shares of Common Stock Beneficially Owned by the purchase price Liberty Parties as stated to which they have dispositive power or (iii) the Proportionate Number of Shares Beneficially Owned by the Liberty Parties (and, in the offer case of a Transfer pursuant to this clause (iii), such Proportionate Number of Shares Beneficially Owned by the Drag-Along Purchaser pro rata based on Liberty Parties shall be comprised of shares of Common Stock of each class in the number same relative proportions as the Liberty Parties' aggregate Beneficial Ownership of Ordinary Shares held by each such Round C Investors (on an as-converted basisclass bears to the Liberty Parties' aggregate Beneficial Ownership of Common Stock of all classes); provided, furtherhowever, that except with respect to any liability incurred by such Other Investor individuallyif, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested Transfer by the Drag-Along SellerFounders, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.Mr. Gene W.

Appears in 2 contracts

Samples: Agreement and Plan of Restructuring and Merger (Unitedglobalcom Inc), Agreement and Plan of Restructuring and Merger (Liberty Media Corp /De/)

Drag-Along Rights. (a) If, at any time prior to any Initial Public Offering, a Qualified IPO, any Investor Sponsor Shareholder (or group of Sponsor Shareholders) (the “60% Seller”) proposes to Transfer, in a bona fide arm’s-length transaction or series of related transactions, to a Person not affiliated with such Sponsor Shareholder (or group of Sponsor Shareholders), at least 60% of the voting power with respect to the election of directors of then-outstanding Common Shares, including pursuant to a sale, merger, business combination, recapitalization, consolidation, reorganization, restructuring or similar transaction, the 60% Seller shall have the option (a “Drag-Along Right”), exercisable upon ten (10) business days’ prior written notice to the Management Shareholders, to require the Management Shareholders to sell a number of their Common Shares equal to (1) the total number of Common Shares, owned by such Management Shareholder, multiplied by (2) a fraction (i) the numerator of which is the number of Common Shares the 60% Seller proposes to Transfer to the Proposed Transferee and (ii) the denominator of which is the total number of Common Shares held by the 60% Seller; provided that the sale price of any Class B Share that is required to be sold according to such Drag-Along Right shall equal the Fair Market Value of each such Class B Share on the date of the anticipated consummation of such sale contemplated in this Section 5 as determined by the Board prior to such sale. For the avoidance of doubt, nothing in this Section 5 shall cause any unvested Restricted Shares or unvested options to acquire Restricted Shares to become vested or exercisable and any requirement by the 60% Seller for a Management Shareholder to sell a number of their Common Shares shall apply only to fully vested Common Shares. (b) Each Management Shareholder selling Common Shares pursuant to a transaction contemplated by this Section 5 (a “Drag-Along Seller”) secures an irrevocable offer agrees to acquire cooperate in consummating such a sale, including, without limitation, by becoming a party to the sales agreement and all other appropriate related agreements, delivering, at the consummation of such sale, share capital certificates (if any) and other instruments for such Common Shares duly endorsed for transfer, free and clear of all liens and encumbrances, and voting or assets consenting in favor of such transaction (to the extent a vote or consent is required) and taking any other necessary or appropriate action in furtherance thereof, including the execution and delivery of any other appropriate agreements, certificates, instruments and other documents (including, without limitation, making any representations and warranties with respect to the Company (a “or the Company’s business to the same extent that the 60% Seller does). In addition, each Drag-Along Sale”Seller shall, if and to the extent requested by the 60% Seller, agree to be severally responsible for its proportionate share (based on share of total cash consideration received by all sellers in the transaction) with a valuation of the third-party expenses of sale incurred by the sellers in connection with such sale and the monetary obligations and liabilities incurred by the sellers in connection with such sale. Such several monetary obligations and liabilities shall include (to the extent such obligations are incurred) monetary obligations and liabilities for indemnification (including for (a) breaches of representations and warranties made in connection with such sale by the Company or any other seller with respect to the Company or the Company’s business and (b) breaches of more than US$600,000,000 with any Person covenants in effect prior to closing, but only, the case of either (a) or (b) to the extent such Personbreaches or inaccuracies are of a type for which insurance can be obtained on commercially reasonable terms), and shall also include amounts paid into escrow or subject to holdbacks, and amounts subject to post-closing purchase price adjustments, provided that all such obligations are equally applicable on a several and not joint basis to each Drag-Along Purchaser”Seller based on the consideration received by such Drag-Along Seller. The foregoing notwithstanding, (a) upon such terms and conditions as agreed to with without the written consent of a Drag-Along Seller, the amount of such obligations and liabilities for which such Drag-Along Sale is agreed by a majority vote of Seller shall be responsible shall not exceed the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held gross proceeds received by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with such sale, (b) the duration of a Drag-Along SaleSeller’s liability for indemnification with respect to a Transfer under this Section 5 shall not exceed one year from the date of such Transfer, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (dc) The a Drag-Along Seller shall provide written notice of not be obligated to enter into any additional non-compete or other post-closing covenant that restricts its activities in any way and (d) a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing not be responsible for the Drag-Along Sale on the terms fraud of any other seller or any indemnification obligations and conditions set forth in liabilities for breaches of representations and warranties made by any other seller with respect to such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall other seller’s (i) make such representations, warranties ownership of and covenants and enter into such definitive agreements as are customary for transactions title to capital shares of the nature of the Drag-Along SaleCompany, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Sellerorganization, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, authority and (iv) be required to bear its proportionate share of the costs conflicts and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Saleconsents.

Appears in 2 contracts

Samples: Management Shareholders Agreement, Management Shareholders Agreement (Intelsat LTD)

Drag-Along Rights. (a) IfSubject to Section 4.7, a Drag-Along Transaction may be initiated in compliance with this Section 4.4 at any time prior to by Aggregator GP (but, if the BIP Funds and their Affiliates own, on a Qualified IPOlook-through basis, less than 50% of the Equity Interests of GP Acquiror, only with the consent and approval of the Holders of more than 50% of the Equity Interests of GP Acquiror on a look-through basis); provided, however that any Investor (the “Drag-Along Seller”Transaction described in clause (b) secures an irrevocable offer to acquire all share capital or assets of the Company (a definition of Drag-Along Sale”) with a valuation Exit Transaction” shall also require the consent of GIC Investor and Enagas Investor provided, further, however, that the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed BIP Funds have used good faith efforts to negotiate with the Drag-Along Seller, proposed purchaser in order to allow Enagas Investor and GIC Investor to retain their Interests in any such Drag-Along Sale is agreed by Transaction (and such efforts shall include permitting GIC Investor and Enagas Investor to directly meet with the proposed purchaser solely to discuss such retention of Interests and post-closing governance rights). If Aggregator GP elects to effect a majority vote of Drag-Along Transaction, Aggregator GP shall deliver written notice thereof to each Co-Investor. (b) In connection with any Drag-Along Transaction properly initiated pursuant to Section 4.4(a), and subject to the other Investors terms and a majority vote of the Foundersconditions set forth in this Section 4.4, each other TGE Investor (an “Other Investor”) agrees, at and its Affiliates shall consent to and raise no objections against the request consummation of the Drag-Along SellerTransaction, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If and if the Drag-Along Sale Transaction is structured as as: (i) a consolidation, merger or other business combination, or a sale or other disposition of Sharesall or substantially all of the assets of one or more Aggregator Entities (as defined below), each Other TGE Investor and its Affiliates, as applicable, shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms vote in favor of the Drag-Along Purchaser; provided that the proceeds from Transaction and shall waive any appraisal rights or similar rights in connection with such consolidation, merger, other business combination or asset sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) a sale of all or substantially all of the purchase price as stated in Interests, each TGE Investor and its Affiliates shall agree to sell all of its Interests that are the offer subject of the Drag-Along Purchaser pro rata based Transaction, on the number terms and conditions of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater Transaction. Subject to Section 4.4(c), each TGE Investor and its Affiliates shall promptly take all necessary and desirable actions in connection with the consummation of the Drag-Along Transaction reasonably requested by Aggregator GP and its Affiliates, including the execution of such agreements and such other instruments and the taking of such other actions reasonably necessary to (A) provide customary representations, warranties, indemnities, and escrow or holdback arrangements relating to such Drag-Along Transaction, and (B) effectuate the allocation and distribution of the aggregate consideration upon the Drag-Along Transaction. The TGE Investors shall be permitted to sell their Interests pursuant to any Drag-Along Transaction without complying with any other provisions of this Article IV other than the proceeds from such salethis Section 4.4. (c) If The obligations of each TGE Investor pursuant to this Section 4.4 are subject to the following terms and conditions: (i) the Drag-Along Sale Transaction shall be effected on the same terms and conditions with respect to the BIP Funds and each TGE Investor (including that the consideration paid for each Class A Share sold (directly or indirectly) by each TGE Investor in any such Drag-Along Transaction shall (1) be the same as the consideration paid for each Class A Share sold by the BIP Funds and (2) be the same as the consideration paid for each Class B Interest sold by the BIP Funds); (ii) the consideration paid in the Drag-Along Transaction shall consist entirely of cash or freely tradeable securities of an entity listed on a national securities exchange (as such term is structured used under the Exchange Act) and taxable as a merger, amalgamation or scheme of arrangement subchapter c-corporation for U.S. income tax purposes; (iii) upon the consummation of the Company or other transaction that requires Drag-Along Transaction, each TGE Investor shall receive the approval same proportion of the Investorsaggregate consideration from such Drag-Along Transaction that it would have received if such aggregate consideration had been distributed by the applicable Aggregator Entity in complete liquidation pursuant to the rights and preferences set forth in the applicable Aggregator Entity LPA as in effect immediately prior to such Drag-Along Transaction, and if each TGE Investor 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 the Parties shall vote take such action as is necessary so that such consideration shall be immediately reallocated among and distributed to each TGE Investor in accordance with such rights and preferences; (iv) Non-ECI Aggregator, ECI Aggregator and VCOC Aggregator and any other entity that acquired interests in the TGE Group in accordance with Section 5.3(b) (each an “Aggregator Entity”) shall each bear its respective Shares (or execute and deliver any written consents pro-rata portion of the reasonable, documented costs incurred in lieu thereof) in favor of connection with any Drag-Along Sale Transaction and all actions deemed reasonably necessary by each TGE Investor shall not be obligated to make any out-of-pocket expenditure in connection with the consummation of the Drag-Along Seller Transaction (excluding modest expenditures for postage, copies, and the like) that is more than its pro rata share (based upon the amount of consideration received by it in the Drag-Along Transaction) of reasonable expenses incurred in connection with a consummated Drag-Along Transaction for the benefit of all Holders that are not otherwise paid by the applicable Aggregator Entity or another Person; (v) no TGE Investor shall be required to provide any representations, warranties or indemnities under any agreements entered into in connection with the Drag-Along SaleTransaction, other than customary (including with respect to qualifications) several (and against not joint) representations, warranties and indemnities concerning: (1) due organization, valid existence and good standing in its state of organization, (2) valid title to and ownership of its Interests, free and clear of all Liens (excluding those arising under applicable securities laws); (3) authority, power and right to enter into and consummate the Drag-Along Transaction; (4) the absence of any action violation, default or proposal that may prevent, hinder acceleration of any agreement to which each TGE Investor is subject or impede the consummation by which its assets are bound as a result of the Drag-Along SaleTransaction; and (5) the absence of, or compliance with, any governmental or third-party consents, approvals, filings or notifications required to be obtained or made by each TGE Investor in connection with the Drag-Along Transaction, other than under the HSR Act; (vi) no TGE Investor shall be required to provide any post-closing non-competition, non-solicitation or other similar restrictive covenants (other than customary confidentiality covenants) under any agreements entered into in connection with the Drag-Along Transaction; (vii) no TGE Investor shall be obligated to provide any indemnification or otherwise agree to be liable to the purchaser in any such Drag-Along Transaction for representations and warranties pertaining to any of Aggregator GP, any Closing Silo Entity, GP Acquiror and its Subsidiaries or any member of the TGE Group unless any such indemnification obligations are several and not joint and such indemnification and liability is (x) limited in the aggregate to no more than the amount of consideration received by such TGE Investor from such Drag-Along Transaction and (y) on a pro-rata basis in proportion to the consideration received by the TGE Investors; and (viii) consideration placed in escrow or held back shall be allocated to each TGE Investor 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 4.4(c)(i) as if the ultimate resolution of such escrow or holdback had been known at the closing of the Drag-Along Transaction. (d) The Aggregator GP and its Affiliates shall have the right in connection with any prospective Drag-Along Seller shall provide written notice Transaction (or in connection with the investigation or consideration of a proposed any prospective Drag-Along Sale Transaction) to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior require each TGE Investor and each Aggregator Entity to cooperate fully with potential acquirors in such proposed Drag-Along Saleprospective transaction by taking all customary and other actions reasonably requested by such Persons or such potential acquirors, subject to reasonable and customary confidentiality provisions. The Drag-Along Sale Notice shall identify the Drag-Along PurchaserIn addition, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) Aggregator GP and all other material terms and conditions of the Drag-Along Sale. Each Other Investor its Affiliates shall be required entitled to participate in take all steps reasonably necessary to carry out an auction of any applicable Aggregator Entity, including selecting an investment bank, providing confidential information (pursuant to confidentiality agreements), selecting the Drag-Along Sale on winning bidder and negotiating the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Pricerequisite documentation. (e) The Drag-Along Seller shall have a period of 180 days from Notwithstanding the date of receipt of foregoing, or anything else to the Drag-Along Sale Notice to enter into a definitive agreement providing for contrary in this Agreement or the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Noticeother Transaction Documents, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect Exit Transaction (including a Drag-Along Sale after such 180Transaction) shall be effected solely through a transaction which would not result in corporate-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e)level taxation borne (directly or indirectly) by GIC Investor. (f) In connection with a Drag-Along SaleFor the avoidance of doubt, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other GIC Investor shall be obligated entitled to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear retain its proportionate share of the costs Interests and expenses incurred by the Company its rights under this Agreement and the Investors other Transaction Documents in connection with the proposed transaction (whether or any Exit Transaction that does not consummated), including all attorney’s fees constitute a GIC Qualifying Sale and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may Enagas Investor shall be entitled to retain its Interests and its rights under this Agreement and the other Transaction Documents in connection with a Drag-Along any Exit Transaction that does not constitute an Enagas Qualifying Sale.

Appears in 2 contracts

Samples: Equityholders Agreement (GIC Private LTD), Equityholders Agreement (Enagas U.S.A. LLC)

Drag-Along Rights. (a) If, at If any time prior one or more of the Permira Stockholders (the “Permira Sellers”) proposes to Transfer (including pursuant to a Qualified IPOmerger), to any Investor Person or Group that is not an Affiliate of any of the Permira Stockholders (a “Third Party Purchaser”), more than 50% of the shares of Common Stock of the Company, then the Permira Sellers may require each other Stockholder (the “Dragged Stockholder”) to Transfer that percentage of its Common Stock equal to the percentage of the Common Stock held by the Permira Sellers which are being Transferred to the Third Party Purchaser for the same per share consideration and otherwise on equivalent terms and conditions as those received by the Permira Sellers (the “Drag-Along SellerSale); provided, however, that no Stockholder shall be required to Transfer any shares of Common Stock unless each other Stockholder is also required to make such a Transfer in accordance with this Section 4. (b) secures an irrevocable offer to acquire all share capital or assets of The Permira Sellers shall send written notice (the Company (a “Drag-Along SaleNotice”) with a valuation of the Company exercise of more than US$600,000,000 its rights pursuant to this Section 4 to each Dragged Stockholder setting forth the consideration per share of Common Stock to be paid pursuant to the Drag-Along Sale, the identity of the Third Party Purchaser and any other material terms and conditions of the transaction. Each Dragged Stockholder, upon receipt of the Drag-Along Notice, shall be obligated to (i) vote its shares of Common Stock, if applicable, in favor of such Drag-Along Sale at any meeting of holders of Common Stock called to vote on or approve such Drag-Along Sale (or any written consent solicited for such purpose), (ii) participate in the Drag-Along Sale and Transfer all of its shares of Common Stock required to be Transferred pursuant to Section 4(a) to such Third Party Purchasers and (iii) otherwise take all necessary action, including, without limitation, to the extent applicable, expressly waiving any dissenter’s rights or rights of appraisal or similar rights, entering into an agreement reflecting the terms of the Drag-Along Sale, surrendering certificates, cooperating in obtaining any applicable Governmental Authorization and otherwise as reasonably required to assist the Permira Sellers in the consummation of such Drag-Along Sale. Any such Drag-Along Notice may be rescinded by the Permira Sellers by delivering written notice thereof to each Dragged Stockholder. (c) Solely for purposes of Section 4(b)(i) and in order to secure the performance of each Stockholder’s obligations under Section 4(b)(i), each Stockholder hereby irrevocably appoints each other Stockholder that qualifies as a Drag-Along Proxy Holder (as defined below) the attorney-in-fact and proxy of such Stockholder (with any Person full power of substitution) to vote or provide a written consent with respect to its Common Stock as described in this paragraph if, and only in the event that, such Stockholder fails to vote or provide a written consent with respect to its Common Stock in accordance with the terms of Section 4(b)(i) (each such Stockholder, a “Breaching Drag-Along Stockholder”) within three (3) days of a request for such vote or written consent. Upon such failure, the Permira Sellers shall have and are hereby irrevocably granted a proxy to vote or provide a written consent with respect to each such Breaching Drag-along Stockholder’s Common Stock for the purposes of taking the actions required by Section 4(b)(i) (such PersonPermira Sellers, a “Drag-Along PurchaserProxy Holder) upon such terms and conditions as agreed ). Each Stockholder intends this proxy to with the Drag-Along Sellerbe, and it shall be, irrevocable and coupled with an interest, and each Stockholder will take such Drag-Along Sale is agreed further action and execute such other instruments as may be necessary to effectuate the intent of this proxy and hereby revoke any proxy previously granted by a majority vote of it with respect to the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as matters set forth in Section 4(b)(i) with respect to the Common Stock owned by such Stockholder. Notwithstanding the foregoing, the conditional proxy granted by this Section 9.14(c) shall be deemed to be revoked upon the termination of this Section 4 in accordance with this Agreement. (bd) If the Drag-Along Sale is structured as a sale The obligations of Shares, each Other Investor shall sell Dragged Stockholder pursuant to Section 4(a) are subject to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor satisfaction of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors following conditions: (i) A Dragged Stockholder shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) required to provide any representations or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller warranties in connection with the Drag-Along SaleSale other than representations and warranties concerning such Dragged Stockholder’s valid ownership of its shares of Common Stock free of all Encumbrances, and against any action or proposal that may preventsuch Dragged Stockholder’s authority, hinder or impede the consummation of power and right to enter into and consummate the Drag-Along Sale. (dii) The Drag-Along Seller shall In the event that the Permira Sellers are required to provide written notice of a proposed representations, warranties or indemnities in connection with the Drag-Along Sale (other than representations, warranties or indemnities by any concerning the Permira Sellers valid ownership of their shares of Common Stock free of all Encumbrances, and the Permira Sellers authority, power and right to enter into and consummate the Other Investors (a “Drag-Along Sale Notice”without violating any other agreement) not later than ten and the Permira Sellers are required to indemnify the party or parties transacting with the Permira Sellers in the Drag-Along Sale, then each Dragged Stockholder shall indemnify the Permira Sellers (10or shall provide the same indemnity as the Permira Sellers to the party or parties transacting with the Permira Sellers in the Drag-Along Sale) days prior to the extent of the lesser of (A) its pro rata share of such proposed indemnification payments (based upon the total consideration received by such Dragged Stockholder divided by the total consideration received by all sellers in such Drag-Along Sale) and (B) the total proceeds actually received by such Dragged Stockholder as consideration for its shares of Common Stock in such Drag-Along Sale. The Drag-Along Sale Notice In any such event, such liability shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed be several and not joint with any other Person. (e) Each Dragged Stockholder shall use commercially reasonable efforts to secure any Governmental Authorization required to be made (the “Drag-Along Sale Price”) obtained by such Dragged Stockholder and shall provide any information which may be needed from such Dragged Stockholder in connection therewith, to comply as soon as reasonably practicable with all applicable Laws and to take all such other material terms actions and conditions of to execute such additional documents as are necessary or appropriate in order to consummate the Drag-Along Sale. Each Other Investor . (f) Notwithstanding anything in this Section 4 to the contrary, no Transfer by any Dragged Stockholder shall be required to participate in permitted from the time that a Drag-Along Notice is received until the consummation or termination of such Drag-Along Sale on (other than any Transfer by the terms and conditions set forth Dragged Stockholders in the such Drag-Along Sale Notice and to tender its SharesSale). The price and form provisions of consideration payable in such transfer this Section 4 shall be also apply to any shares of Common Stock acquired by or issued to any Stockholder after the Drag-Along Sale Pricedate of this Agreement, including any Option Stock. (eg) The Drag-Along Seller shall have a period of 180 days from the date of receipt All costs and expenses of the Drag-Along Sale Notice incurred by any Dragged Stockholder shall be borne by such Dragged Stockholder. Notwithstanding the foregoing, the Dragged Stockholders shall not be required to enter into a definitive agreement providing for the Drag-Along Sale on the terms bear any costs and conditions set forth in expenses of such Drag-Along Sale Notice, which Drag-Along Sale shall incurred by the Permira Sellers (it being understood that such expenses may be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If paid for by the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(eCompany). (fh) In connection with For purposes of clarification, when used in this Section 4, the phrases “same per share consideration” and “equivalent terms and conditions” shall not include transaction, banking, monitoring or service fees or any other fees of a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the similar nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable paid to the Drag-Along SellerPermira Stockholders, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person whether in connection with such Drag-Along Sale severally; providedor otherwise, furtheror any employment, that no Other Investor shall be obligated to indemnify consulting, change of control, non-compete or any other shareholder for any breach or misrepresentation by such other shareholder with respect fees of a similar nature paid to title in such other shareholder’s equity securitiesthe Dragged Stockholder, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors whether in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the such Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ Sale or appraisal rights to which they may be entitled in connection with a Drag-Along Saleotherwise.

Appears in 2 contracts

Samples: Stockholders' Agreement, Stockholders' Agreement (FTT Holdings, Inc.)

Drag-Along Rights. (a) If, If at any time prior to after thirty-six (36) months from the Closing, a Qualified IPOTrade Sale which values the Company at no less US$3 billion (the “Approved Sale”) is approved by (i) the Preferred Majority (which, any Investor for the purpose of this Section 5.1, shall include Tencent, in the event the acquirer is a Tencent Competitor, and shall include CMC Holdings, in the event the acquirer is a CMC Competitor); and (ii) holders of at least two-thirds (2/3) of the Ordinary Shares (voting together in a single class) (together with the Preferred Majority, the “Drag-Along SellerShareholders) secures an irrevocable offer to acquire all share capital or assets ), then upon written notice from the Drag-Along Shareholders, each of the other Shareholders of the Company (a the Drag-Along SaleDragged Shareholders”) shall (i) vote, or give its written consent with a valuation respect to, all the Shares held by them in favor of such proposed Approved Sale and in opposition of any proposal that could reasonably be expected to delay or impair the Company consummation of more than US$600,000,000 with any Person such proposed Approved Sale; (such Personii) sell, a “Drag-Along Purchaser”) upon such terms and conditions transfer, and/or exchange, as agreed to with the Drag-Along Sellercase may be, and such Drag-Along Sale is agreed by a majority vote all of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate their Shares in such Drag-Along Approved Sale as set forth in this Section 9.1. to such purchaser; (biii) If the Drag-Along Sale is structured as a sale refrain from exercising any dissenters’ rights or rights of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are appraisal under applicable to the Drag-Along Seller, including the same per-share consideration Law at any time with respect to a specific class of Sharesor in connection with such proposed Approved Sale; and (iv) take all actions reasonably necessary to consummate the proposed Approved Sale. If any Dragged Shareholder does not elect to vote, and shall execute or give its written consent with respect to, all the necessary transfer forms Shares held by them in favor of such proposed Approved Sale, such Dragged Shareholder shall be obliged to purchase all the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller Shareholders at the price and terms offered by the potential purchaser in connection with the Drag-Along Sale, and against such proposed Approved Sale (each a “Potential Purchaser”). Notwithstanding any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale provision to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchasercontrary, the per-Ordinary Share consideration for which a share transfer is proposed restrictions of Section 3 of this Agreement shall not apply to be any transfers made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required pursuant to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e)5. (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 2 contracts

Samples: Shareholder Agreement (Bilibili Inc.), Shareholder Agreements (Bilibili Inc.)

Drag-Along Rights. (a) If, at any time prior Prior to a Qualified an IPO, following the earlier of (x) the third anniversary of the date of this Agreement or (y) the approval of the proposed Transfer pursuant to Section 4(a) hereof, if any Investor Stockholder, whether alone or in concert with any other Stockholders, in each case owning collectively more than 50% of the voting rights of the Company (such Stockholder(s) being referred to in this Section 7 as the “Exiting Stockholder(s)”) propose to Transfer to any Person or Group that is not an Affiliate of such Investor Stockholder (collectively, a “Drag-Along SellerTransferee”) secures an irrevocable offer to acquire all share capital or assets shares of the Company Stock which would result in a Change of Control Transaction (a “Drag-Along Sale”), then the Exiting Stockholder(s) with a valuation of the Company of more may elect to require each (but not fewer than US$600,000,000 with any Person all) other Stockholder (such Person, each a “Drag-Along PurchaserDragged Stockholder”) upon such terms and conditions to Transfer Stock (as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by calculated below) as a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request part of the Drag-Along Seller, Sale to participate in such Drag-Along Sale Transferee, at the same price and upon the same terms and subject to the same conditions as, the Exiting Stockholder(s) (including, for the avoidance of doubt, the requirement to make a rollover investment in the Drag-Along Transferee or its Affiliates), all of which shall be set forth in the Drag-Along Notice (as defined below). The Exiting Stockholder(s) may require each Dragged Stockholder to Transfer that number of shares of Stock as is equal to the product of (x) a fraction, the numerator of which is the number of shares of Stock as is proposed to be sold by the Exiting Stockholder(s) to the Drag-Along Transferee and the denominator of which is the aggregate number of shares of Stock owned as of the date of the Drag-Along Notice by the Exiting Stockholder(s) and (y) the number of shares of Stock if so elected by the Exiting Stockholder(s) as set forth in this Section 9.1above) owned by such Dragged Stockholder as of the date of the Drag-Along Notice. (b) If The rights set forth in Section 7(a) shall be exercised by giving written notice (the “Drag-Along Notice”) to each Dragged Stockholder and to the Company setting forth in detail the terms of the proposed Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to and the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor proposed closing date of the Drag-Along Purchaser; provided that the proceeds from such sale of Sale. In connection with any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on Sale, all Dragged Stockholders shall be obligated, if applicable, to vote (or consent in writing, as the number of Ordinary case may be) all Voting Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) them in favor of any Drag-Along Sale being effected by merger or consolidation and the Dragged Stockholders and the Company shall in all actions deemed reasonably necessary other respects support the transaction contemplated by the Drag-Along Seller Sale and shall be obligated to cooperate in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (dtransaction contemplated thereby and shall execute all documents, including a sale, purchase or merger agreement, reasonably requested by the Company or the Exiting Stockholder(s) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to containing the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor ; provided, however, that (i) no Dragged Stockholder shall be required to participate make any representations or warranties in the any agreement relating to a Drag-Along Sale on other than representations and warranties relating to such Dragged Stockholder and the terms ownership of its Stock that are customary in similar transactions including representations and conditions set forth in the Drag-Along Sale Notice warranties relating to title, authorization and to tender its Shares. The price execution and form of consideration payable in such transfer delivery, (ii) each Stockholder shall be severally liable for its pro rata portion (based upon the Drag-Along Sale Price. ratio of such Stockholder’s Stock to the total amount of all Stockholders’ Stock) of any purchase price adjustment, escrow or indemnity payments, provided, however, that the aggregate amount of liability described in this clause (eii) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which connection with any Drag-Along Sale shall be promptly consummated, subject not exceed the proceeds to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person Stockholder in connection with such Drag-Along Sale severallySale, (iii) no Dragged Stockholder (other than any Management Holder) shall be required to agree to any covenant not to compete, non-solicitation covenant or similar restrictive covenant which is materially more restrictive than any such covenant which will apply to the THL Party as a result of and/or in connection with the Drag-Along Sale; provided, further, that no Other none of the Investor Stockholders shall in any Drag-Along Sale be obligated required to indemnify agree to any other shareholder for any breach or misrepresentation by such other shareholder with respect covenant not to title in such other shareholder’s equity securitiescompete, and (iv) each Stockholder shall receive the same form of consideration as the Selling Stockholder, and if such Selling Stockholder is given an option as to the form and amount of consideration to be required to bear its proportionate share received, each other Stockholder shall be given the same option. In addition, no Dragged Stockholders shall exercise any rights of the costs and expenses incurred by the Company and the Investors appraisal or dissenters rights that such Dragged Stockholder may have (whether under applicable law or otherwise) or could potentially have or acquire in connection with the proposed transaction (whether any Drag-Along Sale or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage any proposal that is necessary or investment banking fees, charges or commissions (including, if requested by desirable to consummate the Drag-Along SellerSale. (c) The Drag-Along Transferee and any Drag-Along Sale transaction pursuant to this Section 7 shall be selected pursuant to a sale process determined by the Exiting Stockholder(s), which may include an auction process managed by an investment banking firm selected by the Exiting Stockholder(s). All fees and expenses related to any Drag-Along Seller and engagedSale, on customary terms (including customary indemnification from the Company))fees of any such investment banking firm but not including the fees of counsel for any individual Stockholder, to the extent not shall be paid by the Company, and . (vd) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with Upon delivery of a Drag-Along SaleNotice to the Company, the Company will take such actions as are necessary to accomplish the Drag-Along Sale specified therein as soon as is reasonably practicable. Notwithstanding anything contained herein to the contrary, nothing in this Section 7 shall be deemed to compel any director to act in violation of his fiduciary duties. (e) All Transfers of Stock to the Drag-Along Transferee pursuant to this Section 7 shall be consummated contemporaneously at the offices of the Company on the later of (i) a business day not less than fifteen (15) or more than sixty (60) days after the Drag-Along Notice is delivered to the Dragged Stockholders or (ii) the fifth business day following the expiration or termination of all waiting periods under the HSR Act or receipt of other regulatory approvals applicable to such Transfers, or at such other time and/or place as the Exiting Stockholder(s) may otherwise determine. The delivery of certificates or other instruments evidencing such Stock duly endorsed for transfer shall be made on such date against payment of the purchase price for such Stock.

Appears in 2 contracts

Samples: Stockholders Agreement, Stockholders Agreement (iParty Retail Stores Corp.)

Drag-Along Rights. (a) IfIf Investor proposes to Transfer all of the Membership Units owned by it and its Affiliates, at to any time prior to Person other than a Qualified IPO, any Investor Permitted Transferee (the “Drag-Along SellerBuyer), Investor will deliver a written notice not later than twenty (20) secures an irrevocable offer Business Days prior to acquire all share capital or assets the proposed date of the Company consummation of such proposed sale (a “Drag-Along SaleNotice”) with a valuation to each Member other than Investor and any Affiliate of the Company of more than US$600,000,000 with any Person Investor (such Personeach, a “Drag-Along PurchaserMember) upon ), stating that Investor wishes to exercise its right under this Section 9.05 with respect to such terms and conditions as agreed to with the Drag-Along SellerTransfer, and such Drag-Along Sale is agreed by a majority vote of setting forth the other Investors name and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request address of the Drag-Along SellerBuyer, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor description of the Drag-Along Purchaser; provided that transaction, the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum proposed amount and Articles) or (ii) the purchase price as stated in the offer form of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); providedconsideration, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of offered by the Drag-Along Sale. Each Other Investor Buyer. (b) Upon delivery of a Drag-Along Notice, each Drag-Along Member shall be required to participate in Transfer all of its Membership Units to the Drag-Along Sale Buyer, upon the same terms and conditions (including as to price (subject to Section 9.05(e)), time of payment and form of consideration) as agreed by Investor and the Drag-Along Buyer. (c) Each Member agrees to take all reasonable actions necessary or desirable, consistent with actions taken by Investor, to carry out the purpose of this Section 9.05 and execute all documents reasonably requested by Investor to effect the Transfer to the Drag-Along Buyer; provided that no Member shall be required to make representations and warranties in connection with a Transfer to a Drag-Along Buyer other than customary representations and warranties, on a several and not joint basis, regarding (i) the power and authority of that Member to engage in the Transfer, (ii) the existence of any material violations as a result of such Transfer under any material agreement to which such Member is a party, (iii) the absence of any consents or approvals (other than those which have been obtained), and (iv) that the Member has good and marketable title to its Membership Units, free and clear of all liabilities, liens and encumbrances. If the other Members have any indemnification obligations in connection with such Transfer, the terms and conditions set forth of each such Member’s indemnification obligation shall be several and shall not exceed the net proceeds to such Member in connection with such Transfer. Each Member agrees to pay its pro rata share of the expenses incurred in connection with a Transfer pursuant to this Section 9.05. (d) If any Drag-Along Member fails to Transfer to the Drag-Along Sale Notice and Buyer its Membership Units to tender its Shares. The price and form of consideration payable in be sold pursuant to this Section 9.05, each Member agrees that the Company may cause such transfer shall Membership Units to be Transferred to the Drag-Along Sale PriceBuyer on the Company’s books in consideration of the purchase price. (e) The Drag-Along Seller shall have a period proceeds of 180 days from the date of receipt of the Drag-Along Sale Notice any sale pursuant to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale this Section 9.05 shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply distributed in accordance with the procedures set forth in this Section 9.1(e)6.04. (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 2 contracts

Samples: Limited Liability Company Agreement (Blue Sphere Corp.), Limited Liability Company Agreement (Blue Sphere Corp.)

Drag-Along Rights. In the event of an Acquisition in which the holders of a majority of the Common Stock of the Company (athe “Approving Holders”) Ifexercise the Drag-Along Right (as defined below), at the Purchaser shall be obligated to and shall, upon the written request of such Approving Holders: (i) sell, transfer and deliver, or cause to be sold, transferred and delivered, to the third-party buyer a pro rata portion of Shares held by the Purchaser, on the same terms applicable to the Approving Holders and/or (ii) execute and deliver such instruments of conveyance and transfer and take such other action, including voting all Shares held by the Purchaser in favor of any time prior Acquisition approved by the Approving Holders and executing any purchase agreements, merger agreements, escrow agreements or related documents, as the third-party buyer may reasonably require and that such Approving Holders shall have executed, in order to a Qualified IPO, any Investor carry out the terms and provisions of this Section 3.5 (the “Drag-Along SellerRight) secures an irrevocable offer to acquire all share capital or assets of the Company (a “Drag). IN FURTHERANCE OF THE FOREGOING, FOR PURPOSES OF ANY ACQUISITION IN WHICH THE APPROVING HOLDERS ARE ENTITLED TO, AND DO, EXERCISE THE DRAG-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such PersonALONG RIGHT, a “DragTHE PURCHASER HEREBY GRANTS TO THE DESIGNEE OF THE APPROVING HOLDERS AN IRREVOCABLE PROXY TO VOTE THE SHARES HELD BY THE PURCHASER IN FAVOR OF ANY ACQUISITION FOR WHICH THE DRAG-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series ALONG RIGHT IS APPLICABLE HEREUNDER. SUCH PROXY IS COUPLED WITH AN INTEREST AND IS VALID FOR A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten PERIOD OF TEN (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale PriceYEARS FROM THE DATE OF THIS AGREEMENT. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 2 contracts

Samples: Patent License Agreement (908 Devices Inc.), Patent License Agreement (908 Devices Inc.)

Drag-Along Rights. (a) IfSubject to Section 2.5 hereto, at if any time prior to Person (or group of Persons) that is not a Qualified IPO, any Investor (the “Drag-Along Seller”) secures Shareholder or an irrevocable Affiliate thereof makes a bona fide offer to acquire all share capital engage in any transaction or assets series of the Company transactions that would result in a Change of Control, and such transaction or transactions are approved by AAMC (such transaction or transactions, a “Drag-Along Sale”) with a valuation of , AAMC shall have the Company of more than US$600,000,000 with any Person right (such Person, a “Drag-Along PurchaserRight”), but not the obligation, to require ARLP (the “Dragged Person”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell tender for purchase to the Drag-Along Purchaser all Shares then held by such Other Investor proposed Transferee, on the same terms and conditions as are applicable apply to AAMC and a per share price equal to the Drag-Along SellerPer Share Fair Market Value, including that number of Preferred Shares up to the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher product of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Preferred Shares held by ARLP immediately prior to the consummation of such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale and (ii) a fraction, the numerator of which is structured the number of Common Shares being sold by all holders of Common Shares in such Drag-Along Sale and the denominator of which is the sum of the aggregate number of Common Shares owned, in the aggregate, by all Shareholders immediately prior to the consummation of such Drag-Along Sale; provided, the Dragged Person, in its capacity as a mergerShareholder, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall also vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by to the extent such transaction(s) requires the approval of the Shareholders, provided the terms of the Drag-Along Seller in connection Sale are consistent with this Section 2.4 and Section 2.5 below. (b) If AAMC elects to exercise its Drag-Along Right under this Section 2.4, AAMC shall give the Dragged Person, at least forty-five (45) days prior to the proposed Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide a written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten containing (10i) days prior the number of Company Securities proposed to be Transferred in such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify (with warrants, options, convertible securities and other common equivalents counted on an as-converted or as-exercised basis) (the Drag-Along PurchaserTerms”), (ii) the per-Ordinary Share name and address of the proposed Transferee and (iii) the consideration for which a transfer the Transfer is proposed to be made (subject to the determination of the Per Share Fair Market Value of the Preferred Shares proposed to be Transferred in the Drag-Along Sale Price”) Sale), and all other material terms and conditions of the Drag-Along SaleTerms, including the form of the proposed agreement, if any. Each Other Investor shall Upon the receipt of a Drag-Along Notice and the determination of the Per Share Fair Market Value of the Preferred Shares to be required to participate Transferred in the Drag-Along Sale Sale, the Dragged Person shall be obligated to sell such Preferred Shares held by the Dragged Person. (c) No later than five (5) Business Days prior to the proposed closing for the Drag-Along Sale, the Dragged Person shall deliver to the Company (or its designated agent) (i) the certificate or certificates, if any, representing the Company Securities of the Dragged Person to be included in the Drag-Along Sale, together with a limited power-of-attorney authorizing AAMC to Transfer such Company Securities on the terms and conditions set forth in the Drag-Along Sale Notice or, in the case of Company Securities held in book-entry form or through direct registration, shall make other delivery arrangements reasonably satisfactory to the Company and (ii) wire transfer instructions for payment of the purchase price for the Company Securities to tender its Shares. The price and form of consideration payable be sold in such transfer Drag-Along Sale. If the Dragged Person fails to make the deliveries described in this paragraph within the prescribed time, the Company shall be have the right, but not the obligation, to redeem, immediately prior to the consummation of the Drag-Along Sale, the Company Securities of the Dragged Person at a redemption price equal to the consideration set forth in the Drag-Along Notice, payable upon the terms and subject to the conditions contained in the Drag-Along Notice. (d) AAMC shall Transfer, on behalf of itself and the Dragged Person, the Company Securities subject to the Drag-Along Sale Price. (eat the same time and, except as permitted in Section 2.5(a) The Drag-Along Seller shall have a period of 180 days from below, on the date of receipt of same terms and conditions as set forth in the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply Concurrently with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature consummation of the Drag-Along Sale, (i) AAMC shall notify the Dragged Person thereof (including identifying the manner of delivery for any non-cash consideration) and (ii) benefit from and the total consideration due to the Dragged Person shall be subject remitted to all such party, with the cash portion of the same provisions purchase price paid by wire transfer of immediately available funds in accordance with the wire transfer instructions of the definitive agreements Dragged Person. Promptly after the consummation of such Drag-Along Sale, AAMC shall furnish such other evidence of the completion and the date of completion of such Transfer as are applicable to may be reasonably requested by the Dragged Person. (e) If AAMC has not completed the Transfer of all such Company Securities on the same terms and conditions as set forth in the Drag-Along Seller, Notice (iiiexcept as permitted in Section 2.5(a) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect below) within 90 calendar days of the purchase price or indemnification obligations; provided that an Other Investor date of the Drag-Along Notice (which 90 calendar day period shall only be obligated to indemnify extended if any other Person in connection with such of the transactions contemplated by the Drag-Along Sale severally; are subject to regulatory approval until the expiration of five (5) Business Days after all such approvals have been received, but in no event later than 180 calendar days from the date of the Drag-Along Notice), (i) the Company (or its designated agent) shall return to the Dragged Person, to the extent previously provided, furtherthe limited power-of-attorney (and all copies thereof) together with all Company Securities, including the certificates representing the Company Securities, if any, that no Other Investor shall be obligated the Dragged Person delivered for Transfer pursuant to indemnify this Section 2.4 and any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred documents executed by the Company and the Investors Dragged Person in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller Sale and engaged, on customary terms (including customary indemnification from the Company)), ii) AAMC shall not conduct any Transfer of Company Securities prior to the extent not paid by return to the CompanyDragged Person of all documents referred to in clause (i) and without again complying with this Section 2.4. (f) The Company shall, and (v) shall cause its employees, accountants and other advisors, representatives and agents to, use its and their commercially reasonable efforts to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights take all reasonable and necessary action to which they may be entitled assist AAMC in connection with its efforts to effect a Drag-Along Sale, including permitting bona fide prospective purchasers to conduct customary due diligence of the Company in a reasonable manner, during regular business hours and upon reasonable advance notice, subject to (i) the execution and delivery of a customary confidentiality agreement with the Company and (ii) the Company’s and the compliance of the board of directors of the Company (the “Board of Directors”) with applicable laws, rules, regulations and orders and any restrictions or commitments in any contracts or agreements to which the Company or any of its subsidiaries is a party or by which it or any of them is bound.

Appears in 2 contracts

Samples: Shareholders Agreement (Altisource Asset Management Corp), Shareholders Agreement (Altisource Residential Corp)

Drag-Along Rights. (a) If, CHPIII shall have the right in connection with a bona fide offer (a "Compelled Sale Offer") by a Person not an Affiliate of CHP (a "Compelled Sale Purchaser") to purchase at any time prior to a Qualified IPO, any Investor (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets least 80% of the Company shares of Common Stock, Preferred Stock and any other equity securities (including, without limitation, warrants, options and preferred stock) of Holdings (each, an "Investment Unit" and collectively, "Investment Units") held by CHPIII (for either cash, securities of a class registered under Section 12 of the Exchange Act (or convertible into such a class of securities) or any combination thereof) to require each (but not less than each, other than the Management Stockholders to the extent of any Investment Units acquired by such Stockholders within 12 months after the Closing Date, other than Common Stock acquired pursuant to the Company's Incentive Stock Option plan) of the other Stockholders to sell the same percentage or all of the Investment Units then held by such Stockholders, to the Compelled Sale Purchaser, for the equivalent consideration per Investment Unit (a “Drag-Along Sale”"Compelled Sale Offer Price(s)") with a valuation of and otherwise on the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such same terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1upon which CHP sells its Investment Units. (b) If CHP elects to exercise its right to compel sale pursuant to this Section 5, CHPIII shall deliver a written notice (a "Compelled Sale Notice") of the Drag-Along Compelled Sale is structured as a sale of Shares, Offer to each Other Investor shall sell Stockholder and Holdings at least 20 days prior to the Drag-Along consummation of any such sale, setting forth the Compelled Sale Offer Price(s), the identity of the Compelled Sale Purchaser all Shares then held by such Other Investor on and the same other terms and conditions as are applicable thereof. Each Stockholder shall deliver to CHPIII in escrow, not less than five Business Days before the proposed date of consummation of the Compelled Sale Offer, the duly endorsed certificate or certificates representing the requisite number of the Investment Units owned by such Stockholder, together with a limited power-of-attorney authorizing CHPIII to transfer such Investment Units to the Drag-Along Seller, including Compelled Sale Purchaser pursuant to the same per-share consideration with respect to a specific class terms of Sharesthe Compelled Sale Offer at the Compelled Sale Offer Price(s), and shall execute in accordance with the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such saleprovisions hereof. (c) If CHPIII shall have 60 days from the Drag-Along date the Compelled Sale Notice is structured as a mergerreceived by the Stockholders (the "Compelled Sale Notice Date") to sell, amalgamation or scheme of arrangement and to cause the other entities constituting CHP to sell, to the Compelled Sale Purchaser at the Compelled Sale Offer Price(s) all of the Company Investment Units subject to the Compelled Sale Offer. Immediately after completion of any such sale pursuant to this Section 5, CHPIII shall notify Holdings and each Stockholder of such completion and shall furnish such evidence of such sale (including time of completion) and the terms thereof as Holdings or other transaction that requires any Stockholder may reasonably request. CHPIII shall substantially concurrently with such closing also remit to each Stockholder the approval proceeds of such sale attributable to the sale of such Stockholder's Investment Units immediately upon receipt thereof. If any sale to a Compelled Sale Purchaser is not completed by the expiration of the Investors60-day period referred to in this Section 5(c), then, without prejudice to CHPIII's right to seek to compel a sale under this Section 5 in the future, CHPIII shall return to each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor Stockholder all certificates representing the Investment Units of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Salesuch Stockholder. (d) The Drag-Along Seller shall provide written notice of No Stockholder required to sell Investment Units pursuant to a proposed Drag-Along Compelled Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor Offer shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling make any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks representation or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person warranty in connection with such Drag-Along Compelled Sale severally; providedOffer other than as to such Stockholder's ownership and authority to transfer, furtherfree of liens, that no Other Investor shall claims and encumbrances, the Investment Units proposed to be obligated to indemnify any other shareholder for any breach or misrepresentation sold by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Saleit.

Appears in 2 contracts

Samples: Stockholders Agreement (Universal Compression Inc), Stockholders Agreement (Universal Compression Holdings Inc)

Drag-Along Rights. (a) IfThe provisions of this Section 3.08 shall terminate upon the IPO. (b) Following the end of the Restricted Period, except as provided for in Section 3.03(b), in the event that any Shareholder that, together with its Permitted Transferees, holds at least 75% of the Fully Diluted Shares (the “Dragging-Along Shareholder”) proposes to sell all of its Securities in a bona fide transaction to a Third Party, then the Dragging-Along Shareholder shall have the unconditional right to effect the sale of all (but not less than all) of such Securities in either a private or public sale, at the option of the Dragging-Along Shareholder (such transaction, the “Drag-Along Transaction”). In such event, the Dragging-Along Shareholder may, at its option, require the other Shareholder (the “Dragged-Along Shareholder”) to sell all of the Securities then held by or registered in the names of such Dragged-Along Shareholder and its Permitted Transferees (“Drag-Along Offered Securities”) to the Third Party or Parties in the Drag-Along Transaction for the same consideration and otherwise on the same terms and conditions upon which the Dragging-Along Shareholder sells its Securities, subject to Section 3.08(f). Each Shareholder hereby agrees that it will vote in favor of (or execute any time prior written resolutions with respect to) any transaction required by this Section 3.08(b) and to take such further actions as may be reasonably required to effect such transaction, in each case, to the extent not consistent with this Agreement. In the event of a Qualified IPODrag-Along Transaction, any Investor none of the provisions of Sections 3.02(b), 3.05, 3.06, and 3.07 shall apply. (c) The Dragging-Along Shareholder shall provide a written notice (the “Drag-Along SellerNotice”) secures an irrevocable offer to acquire all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made Transaction (the “Drag-Along Sale PriceOffer”) to the Dragged-Along Shareholder not later than thirty (30) days prior to the consummation of the sale contemplated by the Drag-Along Offer. The Drag-Along Notice shall contain written notice of the exercise of the Dragging-Along Shareholder’s rights pursuant to Section 3.08(b), and shall identify the Third Party or Parties making the Drag-Along Offer, the consideration offered per Share and all other material terms and conditions of the Drag-Along SaleOffer. Each Other Investor shall be required to participate in Within twenty (20) days following the date the Drag-Along Sale on Notice is given, the terms and conditions set forth Dragged-Along Shareholder shall cooperate in such manner as the Dragging-Along Shareholder shall reasonably request to permit the sale of the Securities requested from each such Dragged-Along Shareholder pursuant to the Drag-Along Sale Notice Offer, and shall enter into a sale agreement with respect to tender its Shares. The price the sale of the Securities of the Dragging-Along Shareholder and form of consideration payable in such transfer shall be the Dragged-Along Shareholder pursuant to the Drag-Along Sale PriceOffer and shall reasonably cooperate in the transfer of these Securities to the relevant Third Party; provided, however, that the Dragged-Along Shareholder shall not be required to make any representations and warranties in such sale agreement other than with respect to the Dragged-Along Shareholder’s authority to enter into the sale agreement and ownership of the Securities to be sold by the Dragged-Along Shareholder. The Company shall in connection with the transfer of the relevant Securities to the relevant Third Party request the Board to adopt a resolution to grant the approval for such transfer of Securities pursuant to the Memorandum and Articles of Association. (d) Promptly after the consummation of the sale of Securities pursuant to the Drag-Along Offer and receipt of consideration therefor, the Dragging-Along Shareholder shall remit to the Dragged-Along Shareholder the sales proceeds received by the Dragging-Along Shareholders of the Securities of such Dragged-Along Shareholder sold pursuant thereto less a pro rata portion of the out-of-pocket expenses (including reasonable legal expenses) incurred by the Dragging-Along Shareholder in connection with such sale; provided, however, that the Dragged-Along Shareholder shall not be liable for any such expenses in the event that such sale is not consummated. (e) The Drag-Along Seller shall have a If, at the end of the sixty (60)-day period of 180 days from following the date of receipt giving of the Drag-Along Sale Notice Notice, the Dragging-Along Shareholder has not completed the sale of all its Securities and the Securities of the Dragged-Along Shareholder pursuant to enter into a definitive agreement providing for Section 3.08(b), the Dragging-Along Shareholder shall return to the Dragged-Along Shareholder such documents as it shall reasonably request, and the Dragged-Along Shareholder shall no longer be obligated to cooperate in such sale and transfer pursuant to Section 3.08(b) with respect to such Drag-Along Sale Offer. (f) Except as expressly provided in Section 3.08(d), the Dragging-Along Shareholder shall have no obligation to the Dragged-Along Shareholder with respect to the contemplated sale of any Securities held by such Dragged-Along Shareholder in connection with this Section 3.08. The Dragging-Along Shareholder shall have no obligation to the Dragged-Along Shareholder to sell and transfer any Drag-Along Offered Securities pursuant to this Section 3.08 or as a result of any decision by the Dragging-Along Shareholder not to accept or consummate any Drag-Along Offer (it being understood that any and all such decisions shall be made by the Dragging-Along Shareholder in its sole discretion). No Dragged-Along Shareholder shall be entitled to sell and transfer Securities directly to any Third Party pursuant to a Drag-Along Offer (it being understood that all such sales shall be made only on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject pursuant to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e3.08). (fg) In connection with Upon the consummation of a Drag-Along SaleTransaction, each Other Investor all of the holders of the Securities shall (i) make such representationsreceive the same form and amount of consideration per Security, warranties respectively, taking into account and covenants giving effect to any accrued interest, conversion ratios, liquidation preference and enter into such definitive agreements as are customary for transactions of other provisions relating to the nature of consideration, to which the Drag-Along Sale, (ii) benefit from and be subject to all holders of Securities are entitled in accordance with the same provisions of the definitive agreements as are applicable terms thereof in effect immediately prior to the Drag-Along SellerTransaction, (iii) and if any holders of Preferred Shares or Ordinary Shares are given an option as to the form and amount of consideration to be received, all holders shall be given the same option. In addition, such Shareholder shall not be required to bear its proportionate share of any escrows, holdbacks or adjustments accept consideration in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleTransaction other than cash and/or freely-tradable equity securities registered under the Exchange Act and listed on the New York Stock Exchange or NASDAQ Stock Market and/or any other securities exchange or automated quotation system of similar caliber in the United States or elsewhere.

Appears in 2 contracts

Samples: Shareholder Agreements, Shareholder Agreement (Advanced Micro Devices Inc)

Drag-Along Rights. (a) If, at any time prior to If one or more Investors (a Qualified IPO, any Investor (the Drag-Along Drag Seller”) secures an irrevocable offer desire to acquire all share capital Transfer Company Securities in a single transaction or assets a series of related transactions that represent more than sixty-six and two-thirds percent (66 2/3%) of the Company then outstanding shares of Common Stock and Preferred Stock, taken together, held by all Investors (a “Drag-Along Drag Sale”) with a valuation of ), such Drag Sellers shall have the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed right to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, require each other Investor (an and each other Stockholder in the case of a Transfer in a single transaction or a series of related transactions of all then outstanding shares of Common Stock and Preferred Stock) (each, a Other InvestorCo-Seller”) agreesto Transfer a portion of its Company Securities that represents the same percentage of the Company Securities held by such Co-Seller as the shares being disposed of by the Drag Sellers represent of the Company Securities held by such Drag Sellers. For example, if the Drag Sellers are selling Company Securities that represent seventy percent (70%) of their then outstanding Company Securities (as if the Preferred Stock was converted into Common Stock on a one-for-one basis), each Co-Seller shall be required to sell Company Securities that represent seventy percent (70%) of its then outstanding Company Securities (as if the Preferred Stock was converted into Common Stock on a one-for-one basis). All Company Securities Transferred by Stockholders pursuant to this Section 4.04 shall be sold at the request same price and otherwise treated identically with the Company Securities being sold by the Drag Sellers in all respects; provided that (i) the Co-Sellers shall receive his, her or its pro rata portion of all other forms of consideration of any sort other than the Dragpurchase price for such Company Securities, (ii) no Co-Along Seller will become obligated or liable thereby (whether by agreement to indemnify the purchaser or otherwise) for an amount exceeding the amount of cash or other consideration received by that Co-Seller, (iii) no Co-Seller shall become subject thereby to participate in a covenant not to compete or similar restrictive covenant without such DragCo-Along Sale as set forth in this Section 9.1Seller’s consent, and (iv) no Co-Seller shall be required to make any representations and warranties regarding the Company (other than with respect to its ownership of such Company Securities). (b) If the DragAny Drag Seller intending to exercise its rights under this Section 4.04 shall give each Co-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale Seller at least twenty (20) days’ prior written notice of any Round C Investors such Drag Sale. Each Co-Seller shall not take such actions as may be less than the higher of (i) the Series A Liquidation Amount (as defined reasonably required and otherwise cooperate in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by good faith with such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller Drag Sellers in connection with consummating the Drag-Along SaleDrag Sale (including, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaserwithout limitation, the per-Ordinary Share consideration for which a transfer is proposed voting of any Company Securities to be made (approve such Drag Sale). At the “Drag-Along Sale Price”) and all other material terms and conditions closing of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Drag Sale, each Other Investor Co-Seller shall (i) make deliver certificates, or other applicable documentation, for all Company Securities to be sold by such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the DragCo-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrowsduly endorsed for transfer, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company))as applicable, to the extent not paid by purchaser against payment of the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Saleappropriate purchase price.

Appears in 2 contracts

Samples: Stockholders' Agreement (Corsair Capital LLC), Stockholders Agreement (NewStar Financial, Inc.)

Drag-Along Rights. (a) IfEach Stockholder agrees that a Drag Along Event may be initiated by (i) a mutual written consent to do so executed by the Harvest Funds and the Investcorp Investors, at any time prior (ii) pursuant to Section 4.4(b) or 4.6 by the Investcorp Investors by written notice to the Harvest Funds or (iii) pursuant to Section 4.6 by the Harvest Funds by written notice to the Investcorp Investors. Each party initiating the Drag Along Event pursuant to the immediately preceding sentence is referred to herein as a Qualified IPO, any Investor (the “Drag-Along "Drag Seller”) secures an irrevocable offer to acquire " and all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions initiating parties as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1"Drag Sellers." (b) If Subject to Section 2.4(e), at the Drag-Along Sale is structured as a sale written request of Sharesthe Drag Seller or Drag Sellers, each of the other Stockholders (the "Other Investor Drag Stockholders") agrees to vote all of its shares of Equity Securities, at a special or annual meeting of Stockholders or by written consent in lieu of a meeting, in favor of and, if applicable, shall sell its pro rata portion of the amount of Equity Securities and Stock Options to be Transferred in connection with, the Drag Along Event. In order to effect the foregoing covenant, each Existing Investor that is an Other Drag Stockholder under this Section 2.4 hereby grants to the Drag-Harvest Funds, to the extent the Harvest Funds are a Drag Seller pursuant to this Section 2.4, with respect to all of such Stockholder's shares of Capital Stock an irrevocable proxy (which is deemed to be coupled with an interest) for 20 the term of this Agreement with respect to any stockholder vote or action by written consent solely to effect such Drag Along Purchaser Event in compliance with this Section 2.4. (c) The Company and the Other Drag Stockholders each hereby agree to cooperate fully (including by waiving any other appraisal rights to which such Other Drag Stockholder may be entitled under Applicable Law and each such Stockholder does hereby waive all Shares then held such appraisal rights) with the Drag Sellers and the purchaser in any such Drag Along Event and, to execute and deliver all documents (including purchase agreements) and instruments as the Drag Sellers and such purchaser request to effect such Drag Along Event including, without limitation, the making of representations and warranties as to due incorporation, existence and good standing, power and authority of such Other Drag Stockholder, and ownership of Equity Securities or Stock Options and the granting of all indemnifications (other than TGF which shall provide insurance in form and substance satisfactory to the Drag Sellers with respect to all such indemnifications) and the execution of all agreements (including, without limitation, participating in any escrow arrangements to the extent of their respective pro rata portion) and similar arrangements which the Drag Sellers is making or executing, provided that the indemnification obligation of any Other Drag Stockholder to proposed purchaser with respect to the breach of any representation or warranty concerning the Company shall be limited to the lesser of the pro rata portion of the obligation and the net proceeds to be received by such Other Investor Drag Stockholder in connection with such Drag Along Event. Upon the closing of such Drag Along Event, each Stockholder shall receive its pro rata portion of the net proceeds (taking into account transaction costs and expenses incurred by the Harvest Funds or the Investcorp Investors, as applicable, in connection with such Drag Along Event, reasonable transaction costs and expenses incurred by each other Stockholder in connection with such Drag Along Event and the costs and expenses described in Section 2.4(d) (but only to the extent not paid or payable by the Company under this Agreement)) and such sale shall be on the same terms and conditions as are applicable afforded to the Drag-Along SellerDrag Seller(s). Subject to the transaction costs and expenses discussed in the immediately preceding sentence, including the same per-share consideration for purposes of Section 2.4(b) and 2.4(c), "pro rata portion" shall mean with respect to each Stockholder a specific class fraction, the numerator of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on which is the number of Ordinary Shares Equity Securities (including, for such purposes, the number Stock Options to be exercised prior to such Transfer or to be cashed-out in such Transfer) held by such Round C Investors Stockholder immediately prior to such Drag Along Event and the denominator of which is the total number of such Equity Securities (including, for such purposes, the aggregate number Stock Options to be exercised prior to such Transfer or to be cashed-out in such Transfer) outstanding immediately prior to such Drag Along Event, in each case calculated on an as-converted basis); providedbasis and taking into account for each holder of Stock Options that are cashed-out in the Transfer, furtherrather than exercised prior to the Transfer for shares of Common Stock, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor aggregate exercise price of any Dragsuch Stock Options cashed-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate out in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale PriceTransfer. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 2 contracts

Samples: Stockholders Agreement (Associated Materials Inc), Stockholders Agreement (AMH Holdings, Inc.)

Drag-Along Rights. (ai) IfNotwithstanding the provisions of Section 4(d) above, at any time prior in the event that AES and Siemens collectively Transfer (as defined in the LLC Agreement) to a Qualified IPO, any Investor Third Party one hundred percent (the “Drag-Along Seller”100%) secures an irrevocable offer to acquire all share capital or assets of the Company their respective Subject Securities (a “Drag-Along SaleTransaction”) with and (A) as a valuation result of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote Transaction, such Third Party acquires at least sixty percent (60%) (in the aggregate) of the other Investors issued and a majority vote outstanding shares of Class A Common Stock (including for these purposes the Founders, each other Investor Underlying Class A Shares) and (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (iiB) the purchase price as stated set forth in the bona fide offer of from the Drag-Along Purchaser pro rata based Third Party purchaser represents at least a thirty percent (30%) increase on the number 30-day average trading price for the shares of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors Class A Common Stock (a “Drag-Along Sale Drag Offer”), then AES and Siemens may, at their option, require the QIA Related Parties to sell one hundred percent (100%) of their shares of Class A Common Stock to the third party by giving written notice (the “Drag Notice”) to the QIA Related Parties not later less than ten thirty (1030) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, date stated in the per-Ordinary Share consideration Drag Offer for which a transfer is proposed to be made consummation of the sale contemplated by the Drag Offer (the “Drag-Along Sale PriceApproved Sale) ). The Drag Notice shall contain written notice of the exercise of AES and all Siemens’ rights pursuant to this Section 4(e), and shall set forth the consideration to be paid by the third party and the other material terms and conditions of the Drag-Along Sale. Each Other Investor Drag Offer. (ii) The purchase of shares of Class A Common Stock from the QIA Related Parties pursuant to this Section 4(e) shall be required to participate in on substantially the Drag-Along Sale on the same terms and conditions set forth in and for the Drag-Along Sale Notice and to tender its Shares. The price and form same type of consideration payable in such transfer shall be the Drag-Along Sale Priceto AES and Siemens. (eiii) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice If AES and Siemens exercise their rights pursuant to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day periodthis Section 4(e), the Drag-Along Seller QIA Related Parties shall again comply with the procedures set forth in this Section 9.1(e)sell, exchange or otherwise dispose to such Third Party one hundred percent (100%) of their shares of Class A Common Stock. (fiv) In connection with a Drag-Along the consummation of any Approved Sale, each Other Investor shall (i) make QIA acknowledges and agrees that it shall: a. consent to and raise no objections against any such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Approved Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, and b. not exercise any rights of appraisal, dissenters’ rights or appraisal rights to similar rights, all of which they may be entitled in connection with a Drag-Along Saleare hereby waived.

Appears in 2 contracts

Samples: Stockholders Agreement (Fluence Energy, Inc.), Stockholders Agreement (Fluence Energy, Inc.)

Drag-Along Rights. Notwithstanding anything herein to the contrary, but subject to Sections 5.2(a) and 5.6, (ai) If, at any time prior after the third (3rd) anniversary of the date hereof, if the holders of at least a majority of Common Shares held by the Founder Holdcos and the holders of at least 75% of Series E Shares, approve a Transfer of all Shares held by them or approve a proposed Trade Sale, in each case to a Qualified IPObona fide third party purchaser and based on a total equity value of the Company of no less than US$1,300,000,000, or (ii) ninety-seven (97%) or more of all voting power of the Company, voting together as a single class on an as-converted basis, approve a Transfer of all Shares held by them to a purchaser, or approve a proposed Trade Sale without any Investor requirement in terms of a total consideration, then, in any such event, upon written notice from such Drag-Along Shareholders (as defined below) requesting them to do so, each of the other shareholders of the Company (the “Dragged Shareholders”) shall (i) vote, or give its written consent with respect to, all Shares held by them in favor of such proposed Drag-Along Sale and in opposition of any proposal that could reasonably be expected to delay or impair the consummation of any such proposed Drag-Along Sale; (ii) transfer all of their Shares in such Drag-Along Sale to such purchaser; (iii) refrain from exercising any dissenters’ rights (including without limitation those set forth in Section 8) or rights of appraisal under applicable law at any time with respect to or in connection with such proposed Drag-Along Sale; and (iv) take all actions reasonably necessary to consummate the proposed Drag-Along Sale, including without limitation amending the then existing Restated Articles. All proceeds derived from a Dragged-Along Sale shall be distributed among the holders of Preferred Shares and holders of Common Shares in accordance with the Restated Articles. Notwithstanding any provision to the contrary, the share transfer restrictions of Section 4 of this Agreement shall not apply to any transfers made pursuant to this Section 5, provided that there shall be no Drag-Along Sale in the event that the Preferred Holders other than the Drag-Along Shareholders (the “Minority”) shall agree to purchase all Shares proposed to be sold by the Drag-Along Shareholders on the same terms as the proposed Drag-Along Sale within 10 Business Days after receipt by the Minority of the Drag Along Notice (as defined below) (the “Minority Purchase Right”), in which case all proceeds derived from such sale shall be distributed among the holders of Preferred Shares (other than the Minority exercising the Minority Purchase Right) and holders of Common Shares in accordance with the Restated Articles. The Minority Purchase Right shall be exercised by the Minority in the manner set forth in Sections 5.6 and 5.7 below. For the purpose of this Section 5, as required by the context, (i) the shareholders who have the right to approve a Transfer of Shares or a proposed Trade Sale as set forth above are collectively referred to as the “Drag-Along Seller”) secures an irrevocable offer to acquire Shareholders” and such Transfer of all share capital Shares or assets of the Company (a proposed Trade Sale each is referred as a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms ; and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated purchaser in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall not be promptly consummateddeemed a bona fide third party purchaser if (x) Xiaomi and Kingsoft, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If individually or in the Drag-Along Seller has not entered into a definitive agreement providing for aggregate, directly or indirectly owns or controls the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions voting of more than 30% of the nature total outstanding equity interest in such purchaser, (y) such purchaser directly or indirectly owns or controls the voting of more than 30% of the Drag-Along Saletotal outstanding equity interest in Xiaomi or Kingsoft, or (iiz) benefit from and be subject to all there exists a Person that directly or indirectly owns or controls the voting of more than 30% of the same provisions total equity interest in both such purchaser and any of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs Xiaomi and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleKingsoft.

Appears in 2 contracts

Samples: Shareholder Agreement (Xunlei LTD), Shareholder Agreements (Xunlei LTD)

Drag-Along Rights. (a) If, If at any time prior the Company or the holders of the capital stock of the Company receive a bona fide offer (a “Drag-Along Offer”) by a third party (a “Third Party”) to acquire for value all of the then outstanding shares of the Company or all, or substantially all, of the assets or businesses of the Company (no matter how the transaction may be structured) in which the holders of the Series A Preferred Stock and Series B Preferred Stock would receive in consideration for such transaction an amount not less than four (4) times the purchase price for the Series A Preferred Stock and Series B Preferred Stock (as the case may be), the holders of the Common Stock may require each other Stockholder (including the holders of the Series A Preferred Stock and Series B Preferred Stock) to sell to such Third Party all of the shares of stock of the Company then held by such Stockholders or vote their shares of stock in favor of the transaction if other than a Qualified IPOsale of stock as provided below. If the holders of the Common Stock elect to exercise their right to compel a sale of the Company pursuant to this Section 10, any Investor the holders of the Common Stock will cause a written notice of the Drag-Along Offer (the “Drag-Along SellerNotice”) secures an irrevocable offer to acquire all share capital or assets be delivered to each of the Company (a “Drag-Along Sale”) with a valuation other Stockholders, setting forth the aggregate consideration, the identify of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such Third Party and the other principal terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1thereof. (b) If The Company or the holders of the Common Stock (as the case may be) will have one hundred twenty (120) days from the date the Drag-Along Sale Notice is structured as a sale of Shares, each Other Investor shall sell provided to the Drag-Along Purchaser all Shares then held by such Other Investor on other Stockholders to consummate the same terms and conditions as are applicable sale to the Drag-Along SellerThird Party, including at the same per-share consideration with respect to a specific class of Shares, price and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and substantially similar to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions those set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable shares subject to the Drag-Along SellerOffer pursuant to Section 10(a). If the sale to the Third Party is not completed during such one hundred twenty (120) day period, (iii) then the other Stockholders will be required released from their obligations with respect to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; providedNotice (but not future Drag-Along transactions). (c) Each Stockholder agrees to cast all votes to which such Stockholder is entitled in respect of its shares, furtherwhether at any annual or special meeting, that no Other Investor shall be obligated to indemnify any other shareholder for any breach by written consent or misrepresentation by such other shareholder with respect to title otherwise, in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred same proportion as shares are voted by the Company and the Investors to approve any transaction or series of transactions in connection with which the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by holders of the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms Common Stock exercise their rights in this Section 10 (including customary indemnification from without limitation any recapitalization, merger, consolidations, reorganization or sale of all or substantially all of the assets of the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 2 contracts

Samples: Stockholders Agreement, Stockholders Agreement (Cancer Genetics, Inc)

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Drag-Along Rights. Notwithstanding anything to the contrary herein, in the event that (ai) If, at any time prior after the Closing Date, the Company receives an offer from a Bona Fide Purchaser that, if consummated, will result in a Deemed Liquidation Event (a “Trade Sale Offer”), and (ii) such Trade Sale Offer is approved by the holders of at least seventy-five percent (75%) of the total issued and outstanding Preferred Shares (the “Drag Holders of Preferred Shares”) and the holders of at least fifty-one percent (51%) of the total issued and outstanding Ordinary Shares (the “Drag Holders of Ordinary Shares”, together with the Drag Holders of Preferred Shares, the “Drag Holders”) and subject to stipulations under Section 4.2 of the Schedule of Rights and Preferences attached to the Articles of Association of the Company (a Qualified IPOTrade Sale”), any Investor then the Company and each Shareholder agree that: (i) the Company shall send written notice (the “Drag-Along SellerNotice”) secures an irrevocable offer to acquire all share capital or assets parties to this Agreement within five (5) Business Days of receipt of the Trade Sale Offer, regarding such Qualified Trade Sale; (ii) the Ordinary Shareholder shall sell and transfer, and shall procure all other Shareholders (the “Dragged Holders”) to sell and transfer, their Shares on terms and conditions set forth in the Trade Sale Offer, and to the extent a vote of the Dragged Holders is required to approve such Qualified Trade Sale, each Dragged Holder shall vote the number of Shares of the Company (a “Drag-Along Sale”) with a valuation as to which they have beneficial ownership as of the Company time of more than US$600,000,000 with any Person the applicable record date in favor of such Qualified Trade Sale, and each Dragged Holder shall execute and deliver all related documentation and take such other action in support of such Qualified Trade Sale as shall reasonably be requested, provided that if the Drag Holders do not include JD, JD shall not be included in the Dragged Holders and shall not be obligated to approve and vote for such Qualified Trade Sale or execute and deliver the foregoing documentation and take the foregoing action. Notwithstanding the foregoing, if such Qualified Trade Sale occurs on or prior to the fifth (such Person5th) anniversary from the Closing Date, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and Rights shall not apply unless such Drag-Along Qualified Trade Sale is agreed by a majority vote of results in aggregate proceeds (the other Investors and a majority vote of the Founders, each other Investor (an Other InvestorTrade Sale Proceeds”) agreesof at least US$150,000,000, at provided that the request Trade Sale Proceeds shall be the pre-Tax consideration to be received by the Company, any Group Companies and/or the Shareholders participated in such Qualified Trade Sale. Notwithstanding anything to the contrary contained herein, (i) the Right of First Refusal set forth in Section 4.2 and the Co-Sale Right set forth in Section 4.3 shall not apply to any Disposition of Shares pursuant to this Section 4.5; and (ii) if JD is not included in the Drag Holder, then JD shall not be subject to any Disposition of Shares pursuant to this Section 4.5 and the Drag-Along Seller, to participate in such Drag-Along Sale as Rights set forth in this Section 9.1. (b) If 4.5, provided that, if JD exercises its Right of First Refusal regarding the Drag-Along Qualified Trade Sale, JD shall purchase all, but not less than all, of the shares to be transferred under such Qualified Trade Sale is structured as at a sale of Shares, each Other Investor shall sell purchase price equal to the Drag-Along Purchaser all Shares then held by such Other Investor on price and upon the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its SharesNotice. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures Rights set forth in this Section 9.1(e)4.5 shall terminate upon a Qualified IPO. (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 2 contracts

Samples: Shareholder Agreements (GigaCloud Technology Inc), Shareholder Agreement (GigaCloud Technology Inc)

Drag-Along Rights. (a) If, at In the event that (i) (A) the Company or any time prior to a Qualified IPO, any Investor Legacy Class A Stockholder (the “Prospective Drag-Along Seller”) secures receives an irrevocable offer to acquire all share capital from a third party (which, for the avoidance of doubt, shall not include any Legacy Class A Stockholder, any Upper-Tier Investor or assets any of the Company their respective Affiliates) (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon to purchase or otherwise acquire a number of Class A Shares (whether directly or indirectly, including for the avoidance of doubt, through a Transfer of the direct or indirect Equity Securities of any or all of the Legacy Stockholders) in a transaction (or series of related transactions) that would result in a Change of Control, (B) such terms and conditions as agreed to with transaction has been approved by a Special Board Approval, (C) at least eighty percent (80%) of the consideration offered by the Drag-Along SellerPurchaser consists of cash or Marketable Securities, and (D) the MOIC implied in such transaction would be at least two (2) (such transaction, a “Drag-Along Sale”), or (ii) following May 24, 2017, such Drag-Along Sale is agreed has been approved by a majority vote the Apollo Stockholder or the Legacy Class A Stockholders holding in the aggregate at least forty percent (40%) of the Class A Shares then held by the Legacy Class A Stockholders (in which case, for the avoidance of doubt, such Drag-Along Sale must satisfy the requirements set forth in clauses (i)(A), (i)(C) and (i)(D) above, but no other Investors and approval, including a majority vote Special Board Approval pursuant to clause (i)(B) of this Section 6.04(a) shall be required), then the Prospective Drag-Along Seller shall provide written notice to each Legacy Stockholder at least thirty (30) days prior to the proposed effective date of the Founders, each other Investor proposed Drag-Along Sale (an the Other InvestorDrag-Along Notice”) agreeswhich notice shall set forth that the Drag-Along Purchaser has been informed of the provisions of this Section 6.04 and has agreed to consummate a Drag-Along Sale, at the request number of Class A Shares (the “Drag-Along Shares”) proposed to be acquired in such proposed Drag-Along Sale by the Drag-Along Purchaser (where applicable), the identity of the Drag-Along SellerPurchaser, the amount and type of consideration proposed to participate in be paid per Drag-Along Stock, the proposed closing date of such proposed Drag-Along Sale as set forth in this Section 9.1and any other material terms and conditions of such proposed Drag-Along Sale (the “Drag-Along Terms”). (b) If the Prospective Drag-Along Seller consummates the proposed Drag-Along Sale, each Legacy Class A Stockholder shall (i) be bound and obligated to sell its Drag-Along Portion of its Class A Shares in the proposed Drag-Along Sale on the Drag-Along Terms; and (ii) shall receive the same form and amount of consideration per Class A Share to be received by each other Legacy Class A Stockholder in such proposed Drag-Along Sale for its Class A Stock. If any Legacy Class A Stockholder is structured given an option as a sale to the form and amount of Sharesconsideration to be received, each Other Investor other Legacy Class A Stockholder will be given the same option. Unless otherwise agreed by the Legacy Class A Stockholders, any non-cash consideration shall sell be allocated among the Class A Shares held by the Legacy Class A Stockholders pro rata based on the aggregate amount of such consideration to be received in respect of such Class A Shares. If the Prospective Drag-Along Seller has not completed the proposed Drag-Along Sale within 180 days after the date of delivery of the Drag-Along Notice, the Drag-Along Notice shall be null and void, each Legacy Class A Stockholder shall be released from its obligations under the Drag-Along Notice and it shall be necessary for a separate Drag-Along Notice to be furnished and the terms and provisions of this Section 6.04 separately complied with, in order to consummate such proposed Drag-Along Sale pursuant to this Section 6.04; provided, however, that if a Majority-in-Interest shall have executed a definitive agreement within such period, the terms of any such definitive agreement shall continue to apply to such Drag-Along Sale and the Legacy Class A Stockholders shall not be released from their obligations under this Section 6.04 unless and until such definitive agreement is terminated. (c) Each Legacy Stockholder shall, and shall cause each of its Affiliates (including any Upper-Tier Investors) to, cooperate in connection with the Drag-Along Sale and take all steps reasonably necessary or reasonably requested by the Company, the Drag-Along Purchaser and the other Legacy Stockholders to Transfer its Drag-Along Stock in such Drag-Along Sale to the Drag-Along Purchaser all (or cancel its Class B Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect extent required pursuant to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (iSection 6.04(d) the Series A Liquidation Amount (as defined in the Memorandum case of Legacy Class B Stockholders) and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If otherwise consummate the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by on the Drag-Along Seller Terms (including by waiving any appraisal or dissenter’s rights that may exist under any applicable law, voting for or consenting to any merger, consolidation, sale of assets or similar transaction, executing any purchase agreements, merger agreements, escrow agreements or related documents, including instruments of Transfer and providing customary several, but not joint, representations, warranties and indemnities concerning such Legacy Stockholder’s valid ownership of its Shares, free and clear of all Liens and encumbrances (other than those arising under applicable securities laws or in connection with the Drag-Along Sale) and such Legacy Stockholder’s authority, power, and right to enter into and consummate agreements relating to such transactions without violating any applicable law or other agreement; provided, however, that such agreements, documents or instruments shall not contain any non-competition or similar restrictive covenants). Without limiting the generality of the immediately preceding sentence, each Legacy Stockholder shall, subject to the provisions of any definitive agreement (including any limitations on indemnification set forth therein) entered into in connection with a Drag-Along Sale, indemnify, defend and hold harmless the Drag-Along Purchaser in any Drag-Along Sale, pro rata in accordance with the amount of consideration received by such Legacy Stockholder in connection with such Drag-Along Sale as a proportion of the aggregate amount of consideration received by all such Legacy Stockholders in connection with such Drag-Along Sale, from and against any action losses, damages and liabilities arising from or proposal that may preventin connection with (i) any breach of any representation, hinder warranty, covenant or impede the consummation agreement of the Company in connection with such Drag-Along Sale, and (ii) any other indemnification obligation in connection with such Drag-Along Sale relating to the business or potential liabilities of the Company and its Subsidiaries; provided, that (A) if the Prospective Drag-Along Seller is a Legacy Class A Stockholder, the terms of such indemnification obligation applicable to each other Legacy Stockholder shall be consistent with terms applicable to the Prospective Drag-Along Seller, (B) such indemnification obligation shall be several and not joint, and (C) the aggregate maximum amount of such indemnification obligation shall not exceed the amount of consideration received by such Legacy Stockholder in connection with such Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice For the avoidance of a proposed Drag-Along Sale doubt and notwithstanding anything to the Other Investors contrary herein, (i) if any amount is outstanding pursuant to a “Drag-Along Sale Notice”) not later than ten (10) days prior to Management Loan, then until such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchasertime as all outstanding amounts under such Management Loan have been repaid in full, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days net proceeds from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Noticeotherwise payable to EMI or EEH, which Drag-Along Sale as applicable, shall first be applied to repay such Management Loan or such portion thereof as may be repaid with such net proceeds based on the provisions set forth in Section 4.02(c)(ii) as if such net proceeds were distributed by the Company in accordance therewith, and (ii) all outstanding Class B Shares shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If automatically cancelled upon the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect consummation of a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply in accordance with the procedures set forth in this Section 9.1(e). 6.04, and each Legacy Class B Stockholder shall, subject to the terms and provisions of this Agreement (f) In connection with a Drag-Along Saleincluding, each Other Investor shall for the avoidance of doubt, clause (i) make such representationsof this Section 6.04(d)), warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Salebe entitled to receive, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; providedin respect of its Class B Shares that were cancelled in such Drag-Along Sale, furtheran amount equal to the amount, if any, that no Other Investor shall would be obligated distributable to indemnify any other shareholder the Legacy Class B Stockholders if an amount equal to the product of (A) the aggregate consideration paid to the Legacy Class A Stockholders for any breach or misrepresentation by such other shareholder with respect to title their Class A Shares in such other shareholder’s equity securitiesthe Drag-Along Sale and (B) a fraction, (iv1) be required the numerator of which is the aggregate number of Class A Shares outstanding immediately prior to bear its proportionate share the consummation of the costs and expenses incurred such Drag-Along Sale held by the Company Legacy Class A Stockholders and (2) the Investors in connection with denominator of which is the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested aggregate number of Class A Shares acquired by the Drag-Along SellerPurchaser in such Drag-Along Sale, an investment banking firm selected was treated as a distribution of Capital Proceeds pursuant to the Certificate of Incorporation. (e) Notwithstanding clause (ii) of Section 6.04(d), but subject to clause (i) of Section 6.04(d) and in accordance with Section 6.04(c)), in connection with any Drag-Along Sale, the Company and the Prospective Drag-Along Seller may, in their sole discretion, structure such Drag-Along Sale such that some or all of the Class B Shares are either (i) exchanged by the Company for newly issued Class A Shares pursuant to a Class B Exchange in accordance with the Certificate of Incorporation immediately prior to such Drag-Along Sale, which Class A Shares shall either be (A) freely transferable under federal securities laws by the Class B Stockholders under a resale registration statement to be filed concurrently with or as soon as reasonably practicable following such Drag-Along Sale and the Company shall use its reasonable best efforts to ensure such registration statement is maintained effective at all times thereafter pursuant to applicable federal securities laws, or (B) sold in connection with such Drag-Along Sale, or (ii) sold directly to the Drag-Along Purchaser pursuant to such Drag-Along Sale; provided, that in no event shall the Legacy Class B Stockholders be entitled to receive consideration from such Drag-Along Sale that is less than or in excess of what they would have otherwise received pursuant to a Class B Exchange in accordance with the Certificate of Incorporation if the remaining Class B Shares were exchanged by the Company as if all Class A Shares then held by the Specified Stockholders were being sold at the per Class A Share purchase price being paid by the Drag-Along Seller and engagedPurchaser in such Drag-Along Sale. For the avoidance of doubt, on customary terms (including customary indemnification from the Company)), Legacy Class B Stockholders shall receive the same form of consideration paid to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled Legacy Class A Stockholders in connection with a such Drag-Along Sale. (f) The provisions of this Section 6.04 shall terminate upon the consummation of a Change of Control.

Appears in 2 contracts

Samples: Shareholder Agreement (EP Energy Corp), Shareholder Agreements (EP Energy Corp)

Drag-Along Rights. (a) If, at In connection with (i) the Transfer by the BC Investor or any time prior of its Permitted Transferees (other than any Transfer to a Qualified IPOPermitted Transferee) of at least 80% of the Shares owned by the BC Investor and its Permitted Transferees, as a whole, to a third party or parties that are not Affiliates of the BC Investor (a “Third Party Acquiror”) or (ii) a business combination of the Company with such Third Party Acquiror or the purchaser of all or substantially all of the assets of the Company by such Third Party Acquiror (any of the transactions described in clauses (i) and (ii), a “Sale Transaction”), the BC Investor shall have the right (the “Drag-Along SellerRight”) secures an irrevocable offer to acquire all share capital or assets require that the Silver Lake Investor and any of its Permitted Transferees (collectively, the “Subject Investors”), to include in such Sale Transaction, on a pro rata basis, Shares then held by the Subject Investors of the same class as the Shares subject to such Sale Transaction. Notwithstanding the foregoing, the Subject Investors shall not be subject to any Drag-Along Right unless under the terms of the Sale Transaction, such shareholder receives consideration for its Shares to be included in such Sale Transaction equal to at least (x) two times the initial cost of the Silver Lake Investor’s investment in the Company as of February 4, 2008 in the event such Sale Transaction is consummated prior to the sixth anniversary of February 4, 2008 or (y) the initial cost of Silver Lake Investor’s investment in the Company as of February 4, 2008 in the event such Sale Transaction is consummated after the sixth anniversary of February 4, 2008. (b) For the avoidance of doubt, the BC Investor shall be entitled to exercise this Drag-Along Right with respect to the Subject Investors only if one or more of the BC Investor and its Permitted Transferees are participating in such Transfer. (c) To exercise a Drag-Along Right, the BC Investor shall give each Subject Investor a written notice (a “Drag-Along SaleNotice”) with a valuation containing (i) the name and address of the Company Third Party Acquiror and (ii) the terms and conditions of more than US$600,000,000 with the Sale Transaction (including the identity of the Third Party Acquiror, the aggregate number of Shares agreed to be purchased by the Third Party Acquiror, the purchase price, any Person (such Personescrow and indemnity arrangements, a the form of consideration and the terms of payment, the “Drag-Along PurchaserThird Party Terms). Each Subject Investor shall thereafter be obligated to sell its Shares (including any warrants or options owned by such Subject Investor) upon such terms and conditions as agreed pursuant to with the Drag-Along Seller, and such Drag-Along Sale is agreed by Third Party Terms. (d) The BC Investor shall have a majority vote period of sixty (60) days following the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request date of the Drag-Along Seller, Notice to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If enter into a definitive agreement to sell all the Shares agreed to be purchased by the Third Party Acquiror on the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell Third Party Terms. With respect to the Drag-Along Purchaser Shares proposed to be Transferred, if the BC Investor is unable to cause the Third Party Acquiror to purchase all the Shares proposed to be Transferred by the BC Investor (and its Permitted Transferees) and the Subject Investors, then held by the number of Shares that each such Other Investor on the same terms and conditions as are applicable shareholder is required to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and sell in such proposed Transfer shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser reduced pro rata based on the number of Ordinary Shares proposed to be Transferred by such shareholder relative to the aggregate number of Shares proposed to be Transferred by all shareholders of the Company participating in such proposed Transfer. (e) At the closing of the Transfer pursuant to this Section 1.07, the Third Party Acquiror shall remit to the shareholders participating in such Sale Transaction the consideration for the total sales price of the Shares held by the shareholders sold pursuant hereto minus any consideration to be escrowed or otherwise held back in accordance with the Drag-Along Third Party Terms, if applicable. At the closing of the Transfer pursuant to this Section 1.07, the shareholders participating in such Round C Transfer shall deliver to the Third Party Acquiror the certificates with respect to the Shares, if any, to be conveyed, duly endorsed and in negotiable form with any required documentary stamps affixed thereto or with an instrument evidencing the Transfer subject to the Drag-Along Right reasonably acceptable to the Company and shall agree to comply with any other conditions to closing generally applicable to the BC Investor and all other shareholders selling Shares in the transaction. (f) The Subject Investors (on an asshall consent to and raise no objections against the transaction triggering such Drag-converted basis)Along Right and if such transaction is structured as a sale of stock, each Subject Investor shall take all actions that the Board reasonably deems necessary or desirable in connection with the consummation of the transaction; provided, however, the foregoing shall apply only if, under the terms of such transaction, the treatment of the Subject Investors shall be consistent with the treatment of the BC Investor, and that all representations, warranties, covenants, indemnities and agreements shall be made by the relevant shareholders severally and not jointly and that the aggregate amount of each Subject Investor’s, as the case may be, responsibility for any liabilities shall not exceed such Subject Investor’s pro rata share thereof, determined in accordance with such Subject Investor’s portion of the total number of Shares included in such Transfer; provided, further, that except with respect to (x) in no event shall the aggregate amount of liability of any liability incurred by such Other Subject Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than exceed the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Subject Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller actually received in connection with the Drag-Along Sale, Transfer and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (dy) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Subject Investor shall be obligated to indemnify agree to any non-compete provisions without the written consent of each such Subject Investor participating in such Transfer. Without limiting the generality of the foregoing, and subject to the preceding sentence, each such Subject Investor agrees to (i) consent to and raise no objections against the transaction; (ii) execute any Share purchase agreement, merger agreement or other shareholder for any breach or misrepresentation agreement entered into with the transferee with respect thereto; (iii) vote the Shares held by such other shareholder with respect to title Subject Investor in favor of the transaction triggering such other shareholder’s equity securities, Drag-Along Right and against any alternative transaction; (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification refrain from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any of dissenters’ or appraisal rights with respect to the transaction; and (v) agree to any customary non-solicit provisions relating to employees of the Company requested in connection with such Transfer to the extent that other Subject Investors are required to agree to a similar non-solicit provision. (g) If any such Subject Investor receives securities which they may be entitled are Illiquid Securities as proceeds in connection with a DragTransfer contemplated by this Section 1.07, solely to the extent received by the BC Investor, such Subject Investor shall receive the right to tag-Along Salealong on transfers by the BC Investor and be subject to drag-along rights of BC Investor with respect to such securities that are substantially similar to the tag-along rights and drag-along rights applicable to Shares of such Subject Investor under the Shareholders Agreement and this Agreement and shall receive registration rights with respect to such securities that are substantially similar to the registration rights applicable to Shares under the Shareholders Agreement to the extent received by the BC Investor; provided, that such rights may cease at such time as such securities are no longer Illiquid Securities. (h) This Section 1.07 shall automatically terminate upon the Sponsors owning in the aggregate less than 10% of the outstanding Common Stock of the Company.

Appears in 2 contracts

Samples: Governance Agreement (Intelsat S.A.), Governance Agreement (Intelsat Global Holdings S.A.)

Drag-Along Rights. (a) If, at If an arm’s length Sale Transaction with a third party who is not an Affiliate of the Company or any time prior to a Qualified IPO, any Investor other Stockholder (the “Drag-Along SellerSale Offeror”) secures an irrevocable offer is approved by the Board, the Majority Founders and STI, then, upon the receipt of notice from the Majority Founders and STI that they wish to acquire all share capital or assets of invoke the Company drag-along rights provided in this Article VII (a “Drag-Along SaleSale Notice), each Stockholder shall (i) vote, or act by written consent with respect to, all of such Stockholder’s Shares, in favor of, and raise no objections against, such Sale Transaction, and (ii) if the Sale Transaction is structured as a valuation sale of outstanding stock, sell or otherwise dispose of pursuant to such Sale Transaction that number of the Company Shares owned by such Stockholder as of more than US$600,000,000 with any Person the date of the Sale Notice (such Personas defined below) as shall equal the product of (in each case calculated on a common-equivalent basis) (A) a fraction, a “Drag-Along Purchaser”) upon such terms the numerator of which is the number of shares of Capital Stock proposed to be transferred by the Founders and conditions STI as agreed to with of the Drag-Along Sellerdate of the Sale Notice, and such Drag-Along Sale the denominator of which is agreed by a majority vote the aggregate number of shares of Capital Stock owned as of the other Investors date of such Sale Notice by the Founders and a majority vote STI, multiplied by (ii) the number of shares of Capital Stock owned as of the Founders, each other Investor (an “Other Investor”) agrees, at the request date of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1Notice by such Stockholder. (b) If the Drag-Along Majority Founders and STI have delivered a Sale is structured as Notice, then for a sale period of Sharesone hundred twenty (120) days after the date of such Sale Notice, each Other Investor the Stockholders shall be obligated to sell or otherwise dispose of their Shares to the Drag-Along Purchaser all Shares then held by such Other Investor Sale Offeror on substantially the same terms and conditions as are applicable apply to the Drag-Along Seller, including the same per-share consideration Founders with respect to a specific class of Sharessuch Sale Transaction. Each Stockholder shall pay its owns costs and expenses, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); providedif any, further, that except with respect to any liability incurred by it in connection with the sale or other disposition of its Shares pursuant to such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such saleSale Transaction. (c) If Notwithstanding the Drag-Along Sale is structured as a mergerforegoing, amalgamation or scheme of arrangement the obligations of the Company or other transaction Stockholders under this Article VII shall only apply to a Sale Transaction that requires includes the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale.following terms: (di) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed any representations and warranties to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor by such Stockholders shall be required limited to participate in the Drag-Along Sale on the terms representations and conditions set forth in the Drag-Along Sale Notice and warranties related to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Noticeauthority, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period ownership and the Drag-Along Seller proposes ability to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e).convey title to their Shares; (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and each such Stockholder shall not be subject to all of liable for the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share inaccuracy of any escrows, holdbacks representation or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify warranty made by any other Person in connection with the proposed sale, other than the 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 each such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify Stockholder in the proposed sale for the inaccuracy of any representations and warranties made by the Company in connection with such proposed sale is several and not joint with any other shareholder for Person (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 breach or misrepresentation Stockholder of any identical representations, warranties and covenants provided by all Stockholders) and is pro rata based on the consideration paid to such other shareholder with respect Stockholder as compared to title the total consideration paid to all Stockholders in such other shareholder’s equity securities, the proposed sale; (iv) liability shall be required limited to bear its proportionate such Stockholder’s applicable share (determined based on the respective proceeds payable to each Stockholder in the proposed sale) of a negotiated aggregate indemnification amount that applies equally to all Stockholders, but that in no event exceeds the amount of consideration otherwise payable to such Stockholder in the proposed sale; (v) upon the consummation of the costs proposed sale, each holder of a class or series of Capital Stock shall receive the same form of consideration as each other holder of such class or series of Capital Stock; and (vi) subject to clause (v) above, if any holder of a class of or series of Capital Stock is given an option as to the form and expenses incurred by the Company and the Investors amount of consideration to be received in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and chargessale, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by holders of such class of series of Capital Stock shall be given the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Salesame option.

Appears in 2 contracts

Samples: Stockholders Agreement (Resonant Inc), Exchange Agreement (Resonant Inc)

Drag-Along Rights. (a) IfSubject to the terms and conditions of this Section 6, at any time prior and notwithstanding Section 2(b) herein, if the Trust proposes to sell seventy-five percent (75%) or more of the shares of Common Stock it then holds (the "Drag Sale Shares") to a Qualified IPObona fide unaffiliated third party or parties on an arm's length basis in a single transaction or a series of related transactions for either (i) cash or unrestricted marketable securities that are traded on a U.S. stock exchange, over the counter or on a bulletin board, or (ii) any Investor consideration so long as the third party or parties that have proposed to purchase the Drag Sale Shares shall not become the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the “Drag-Along Seller”Exchange Act), directly or indirectly, of more than fifty percent (50%) secures an irrevocable offer to acquire all share capital or assets of the common stock of the ultimate parent company of the Company (a “Drag-Along Sale”assuming the execution of all outstanding stock options, stock warrants and stock rights, and conversion of all other securities that are convertible to shares of common stock of such ultimate parent company), or if there is no such ultimate parent company, so long as such third party or parties shall not become the "beneficial owner", directly or indirectly of more than fifty percent (50%) with a valuation of the total outstanding Common Stock or Voting Stock of the Company (assuming the execution of more than US$600,000,000 with any Person (such Personall outstanding stock options, a “Drag-Along Purchaser”) upon such terms stock warrants and conditions as agreed to with the Drag-Along Sellerstock rights, and such Drag-Along Sale is agreed by a majority vote conversion of the all other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement securities of the Company that are convertible to shares of Common Stock or other transaction that requires Voting Stock), the approval of the Investors, each Investor Trust shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall be entitled to provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than Holder, at least ten (10) days prior to the closing of such sale, written notice, in accordance with Section 15 herein, of its good faith intention to sell the shares of Common Stock, the name of the proposed transferee(s) (the "Proposed Transferee"), the price and other material terms under which the sale is proposed to be made and that it is requiring the Holder to exercise all or a portion of the Warrant, if any portion remains outstanding and unexpired hereunder, and to sell the Shares obtained through such exercise, if any (the "Required Exercise Shares"), as well as a certain number of the Shares then held by the Holder to the Proposed Transferee on the terms and conditions contained therein ("Drag-Along SaleNotice"), such that the total number of Shares to be sold to the Proposed Transferee by the Holder shall be equal to: C (A + B) x ------ D where: A = the number of Shares then held by the Holder, including the Required Exercise Shares; B = the number of shares of Common Stock subject to the outstanding, unexpired portion of the Warrant (if any) below, after taking into account the exercise required with respect to the Required Exercise Shares (but excluding any portion of the Warrant that is not subject to drag-along rights pursuant to Section 6(f) below); C = the number of Drag Sale Shares; and D = the total number of shares of Common Stock then held by the Trust, subject to the limitation that if the sale price to the Proposed Transferee is less than the then current Exercise Price, (i) the Holder shall not be required to exercise any portion of the Warrant in order to sell to the Proposed Transferee the Shares that could be obtained by such exercise, in connection with the proposed sale and (ii) that portion of the Warrant which the Holder would have been required to exercise under this Section 6 in the absence of the preceding clause (i), shall expire and shall be and become void and of no value, immediately upon consummation of the transaction that is the subject of the Drag-Along Notice. The Holder shall be required to, and shall, comply with the terms of the Drag-Along Notice as long as it is consistent with the terms of this Section 6. The Shares to be sold by the Holder to the Proposed Transferee shall be sold to the Proposed Transferee at a purchase price equal to the product of (x) the number of such Shares, and (y) the per share sale price of the shares of Common Stock proposed to be sold by the Trust to the Proposed Transferee. The Drag-Along Sale Notice shall identify be deemed to be given and served on the date that the Holder receives the Drag-Along PurchaserNotice from the Company in accordance with Section 15. (b) Notwithstanding Section 2(b) herein and subject to Section 6(i) herein, the per-Ordinary Share consideration for which Holder shall, within five (5) days of receipt of a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions Notice, deliver an Exercise Notice to the Company with respect to the Required Exercise Shares provided that the Exercise Date is deemed to occur concurrently with the consummation of the transaction which is the subject of the Drag-Along SaleNotice. Each Other Investor shall be If the Holder does not deliver the Exercise Notice within the required to participate 5-day period or delivers the Exercise Notice without the appropriate payment in cash for the exercise of the Warrant, or portion thereof, as appropriate, upon consummation of the transaction which is the subject of the Drag-Along Sale on Notice the terms and conditions set forth Holder will have been deemed to have delivered a Cashless Exercise Notice to the Company in accordance with Section 2(c) above. The Company's call rights under Section 4(a)(i) shall not apply to the Holder's exercise with respect to the Required Exercise Shares. (c) Promptly after receipt of the Drag-Along Sale Notice and Notice, the Holder shall deliver to tender its Shares. The price and form the Trust, to hold in escrow pending closing of consideration payable in such transfer shall be the transaction that is the subject of the Drag-Along Sale PriceNotice, stock certificates in its possession (if any) representing its shares of Common Stock to be transferred, properly endorsed for transfer to the Proposed Transferee. (d) The Trust shall, together with the Drag-Along Notice, provide to the Holder a fairness opinion from an independent appraiser or investment bank selected by the Trust regarding the transaction that is the subject of the Drag-Along Notice, provided that there shall be no such requirement if the Trust has obtained such a fairness opinion for itself with respect to the transaction that is the subject of the Drag-Along Notice. (e) The monetary value of any indemnity to be provided by the Holder to the Proposed Transferee under the terms of its sale of Shares in accordance with this Section 6 (which indemnity may also cover operational matters not the subject of the Holder's representations and warranties described in the following sentence) shall be in the same ratio to the monetary value of the indemnity provided by the Trust as the ratio of the relative value of the securities to be sold by each of the Holder and the Trust in any such sale, but in no case shall it exceed the monetary value of the consideration it receives pursuant to the terms of such sale. The Holder's representations and warranties shall be limited to enforceability, the ownership of the Shares to be transferred by such Holder, authority to transfer such Shares, that such Shares are free of liens and encumbrances as of the transfer date and other standard and customary non-operational representations and warranties. (f) If the Company has received a Put Notice from the Holder in accordance with Section 5(d) herein prior to delivery by the Trust to the Holder of a Drag-Along Seller Notice, then the Trust shall have a period not be entitled to exercise its drag-along right pursuant to Section 6(a) herein with respect to such portion of 180 days from the date Warrant that is the subject of receipt such Put Notice, unless the per share sale price in connection with the transaction that is the subject of the Drag-Along Sale Notice is greater than or equal to enter into a definitive agreement providing for the Drag-Along Sale on Put Fair Value as of the terms and conditions set forth in date of delivery of such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. Notice by the Trust. (g) If upon the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect Trust's delivery of a Drag-Along Sale after such 180Notice to the Holder there is a pending Exercise Date and/or Put Effective Date, then the corresponding Exercise Notice and the 90-day periodwaiting period under the last sentence of Section 2(b) and/or the corresponding Put Notice and the 90-day waiting period under Section 5(f), as the Drag-Along Seller case may be, shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Salebe tolled, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature date of delivery of the Drag-Along SaleNotice (the "Drag Toll Date") even if any such waiting period has not yet begun to run as of the date of delivery of the Drag-Along Notice, and the Exercise Date and/or Put Effective Date, as applicable, shall be suspended, and shall only be rescheduled in accordance with Section 6(j)(i) below. The suspended Exercise Date and/or Put Effective Date, as appropriate, and the corresponding Exercise Notice and/or Put Notice, as appropriate, shall be cancelled if the transaction that is the subject of the Drag-Along Notice is consummated within sixty (ii60) benefit from days of the date of delivery of the Drag-Along Notice by the Trust to the Holder. (h) If the Trust delivers a Drag-Along Notice to the Holder in accordance with Section 6(a) following its delivery of a Tag-Along Notice to the Holder in accordance with Section 7(a), then such Tag-Along Notice, and any Participation Notice delivered by the Holder in connection with the Tag-Along Notice, shall be deemed cancelled and of no effect as of the date of delivery of the Drag-Along Notice to the Holder, and the Holder shall not be entitled to exercise such tag-along right. (i) Notwithstanding Section 6(b) above and subject to all the limitations of Section 2(a) above, after receiving a Drag-Along Notice, the Holder shall be entitled to deliver to the Company an Exercise Notice relating to the portion of the same provisions Warrant that is the subject of the definitive agreements as are applicable Drag-Along Notice, provided that such Exercise Notice shall only be given effect if the transaction relating to the Drag-Along Seller, Notice is terminated or is not consummated within sixty (iii60) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect days of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share date of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by delivery of the Drag-Along SellerNotice by the Trust, an investment banking firm selected and further provided that no days that have passed from the date of delivery to the Company of the Exercise Notice until the date of such termination or expiration, as appropriate (the "Draft Expiry Date"), shall be counted for purposes of the waiting period under Section 2(b). (j) If the transaction that is the subject of a Drag-Along Notice delivered by the Trust to the Holder in accordance with Section 6(a) herein (the "Drag Transaction") is terminated or is not consummated within sixty (60) days of the date of delivery of the Drag-Along Seller Notice by the Trust, then (i) notwithstanding anything contained herein to the contrary, any Exercise Date and/or Put Effective Date that was/were suspended pursuant to Section 6(g) above shall each be deemed reinstated and engagedrescheduled, on customary terms subject to the following provisions: (including customary indemnification 1) with respect to an Exercise Date, no days that have passed from the CompanyDrag Toll Date until the Drag Expiry Date shall be counted for purposes of the waiting period under Section 2(b) and the corresponding election to exercise the Warrant, or portion thereof, and the corresponding Exercise Notice, shall be deemed reinstated and effective subject to the rescheduled date of the Exercise Date, to reflect the provisions of this Section 6(j)(i)(1); and (2) with respect to a Put Effective Date, the Put Effective Date shall be delayed by adding the number of days that is equal to the number of days that have passed from the Drag Toll Date until the Drag Expiry Date to the 90-day waiting period under Section 5(f), and the corresponding election to put the Warrant, or portion thereof, and the corresponding Put Notice, shall be deemed reinstated and effective subject to the extent not paid by rescheduled date of the CompanyPut Effective Date, and to reflect the provisions of this Section 6(j)(i)(2). (vii) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleNotice shall be deemed voided. (k) The rights of the Trust under this Section 6 shall expire upon the consummation by the Company of a Qualified Public Offering.

Appears in 2 contracts

Samples: Warrant Agreement (Alion Science & Technology Corp), Warrant Agreement (Alion Science & Technology Corp)

Drag-Along Rights. (a) If, From time to time and at any time prior to a Qualified IPOtime, any Investor if the Cerberus Funds (together, the “Drag-Along SellerDragging Member”) secures an irrevocable offer propose to acquire Sell all share capital or assets of their Units then Held, which Units represent more than 50% of the Company Units they Hold as of the Effective Date, to an unaffiliated third party for consideration in the form of cash or securities that are of a class listed or quoted for trading on one or more U.S. national securities exchanges on such date (a “Drag-Along Sale”) and Trican does not elect to exercise its rights under the Existing Holder ROFO, the Dragging Member shall have the right, but not the obligation, to require the other Members (including the Management Members) (each, a “Dragged Member”, and collectively, the “Dragged Members”) to: (i) sell all of their Units (including the Class C Units), with a valuation the proceeds of that sale by the Cerberus Funds and the other holders allocated among the parties as if they were distributed in accordance with Section 7.1; (ii) vote or cause their respective Manager(s) to vote all of their Units that are entitled to vote in favor of the transactions necessary or appropriate to consummate the Drag-Along Sale; and (iii) take such other actions as may be reasonably requested by the Dragging Member or the Company of more than US$600,000,000 with any Person to give effect to the Drag-Along Sale (such Personcollectively, a the “Drag-Along PurchaserRights). (b) upon such terms Each Member affirms and conditions as agreed agrees that it will (i) refrain from exercising any dissenters’ rights, rights of appraisal or any similar rights under applicable Law at any time with respect to with a Drag-Along Sale and (ii) vote or cause its Manager(s) to vote for the approval of the transactions constituting the Drag-Along SellerSale under this Section 5.3, in each case as a condition of this Agreement and as such Drag-Along Sale is agreed by a majority vote of coupled with an interest and is irrevocable. This voting agreement shall remain in full force and effect throughout the other Investors and a majority vote of time that this Section 5.3 is in effect. (c) The Dragging Member shall, promptly upon determining the Founders, each other Investor (an “Other Investor”) agrees, at the request terms of the Drag-Along SellerSale, deliver to participate in such the Dragged Members written notice specifying the material terms of the Drag-Along Sale as set forth in this Section 9.1. (b) If including, without limitation, the identity of the purchaser to which the Drag-Along Sale is structured as a sale proposed to be made, the nature of Sharesthe purchase consideration, each Other Investor shall sell to estimated net proceeds from the Drag-Along Purchaser all Shares then held by such Other Investor on Sale and the same terms and conditions as are applicable to expected closing date of the proposed Drag-Along Sale). (d) In connection with the Drag-Along SellerSale, including the same per-share consideration with respect to a specific class of Shares, and each Member shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined make or agree to representations and warranties relating to itself and its Units in the Memorandum respect of clear title, due authority, required approvals and Articles) or absence of conflicts, (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If if the Drag-Along Sale is structured as a mergerconsummated, amalgamation or scheme of arrangement pay its pro rata share of the Company or other transaction that requires reasonable costs incurred by the approval of Dragging Member relating to the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale (including, without limitation, reasonable legal fees and all actions deemed reasonably necessary expenses), based on such Member’s pro rata share in the net proceeds from such Drag-Along Sale, to the extent not paid or reimbursed by the Company or the purchaser and (iii) participate on a pro rata basis, based on such Member’s pro rata share in the net proceeds from such Drag-Along Sale, in any hold-back, escrow, contingent consideration or other similar items relating to the Drag-Along Seller Sale. (e) Each of the Members agrees that it shall execute such other documents as the Dragging Member may reasonably request in order to consummate the Drag-Along Sale at the time specified by the Dragging Member. (f) Except as expressly provided in this Section 5.3, the Dragging Member shall have no obligation to any Member with respect to the sale of any Units owned by such Member in connection with the Drag-Along Sale. Notwithstanding anything herein to the contrary, the Dragging Member shall have no obligation to any other Member as a result of any decision by the Dragging Member to accept or consummate, or not to accept or consummate, any Drag-Along Sale (it being understood that any and against any action or proposal that may prevent, hinder or impede all such decisions shall be made by the consummation Dragging Member in their sole discretion). (g) If a Dragged Member is required to sell all of the its Class A Units pursuant to a Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of , any unvested Class B Units that will not become vested Class B Units as a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt result of the Drag-Along Sale Notice in accordance with the Management Incentive Plan, any Management Member’s MIP Agreement or any applicable award agreements will be forfeited, any rights thereunder shall automatically terminate and any Retained Distribution shall be distributed to enter into a definitive agreement providing for the Members as though such Retained Distribution were distributed pursuant to Section 7.1 immediately upon such Member’s forfeiture of its Class B Units. (h) The Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth Rights provided in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor 5.3 shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions expire upon the consummation of an Initial Public Offering of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 2 contracts

Samples: Limited Liability Company Agreement (Keane Group, Inc.), Limited Liability Company Agreement (Keane Group, Inc.)

Drag-Along Rights. (a) If, at any time prior to Either or both of the Silver Lake Investors may give notice (a Qualified IPO, any Investor (the “Drag-Along SellerNotice”) secures an irrevocable offer to acquire all share capital the Management Investors and Warrant Investors that (i) the Silver Lake Investor(s) intend to, or assets to cause the Company to, enter into (or have agreed to vote the Transferable Shares they beneficially own, or to execute a written consent in lieu thereof, in favor of) a transaction or transactions involving the transfer, in a single transaction or a series of related transactions, of not less than fifty percent (50%) of the outstanding Transferable Shares (which Transferable Shares to be transferred may include Transferable Shares held by the Management Investors, Warrant Investors and/or other holders of Transferable Shares required to be transferred pursuant to this Section 3.7 or analogous obligations) to one (1) or more Persons (other than the Silver Lake Investors or their affiliated investment funds or their respective portfolio companies) or (ii) the Silver Lake Investor(s) intend to cause the Company to (A) sell all or substantially all of its assets to another Person or Persons (other than the Silver Lake Investors or their affiliated investment funds or their respective portfolio companies) or (B) merge, amalgamate or consolidate with another Person or Persons (other than the Silver Lake Investors or their affiliated investment funds or their respective portfolio companies) where, immediately after such merger, amalgamation or consolidation, the Persons beneficially owning Shares immediately prior to such merger, amalgamation or consolidation do not beneficially own at least fifty (50%) of the outstanding capital stock of the Person surviving such merger, amalgamation or consolidation (in each case, a “Drag-Along Sale”) with a valuation of and that the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed Silver Lake Investors desire to with cause the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Management Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, Warrant Investors to participate in such Drag-Along Sale as in the manner set forth in this Section 9.1. 3.7. Notwithstanding anything to the contrary set forth herein, “Drag-Along Sale” shall not (bx) If include any proposed transaction contemplated by Section 6.5(a) or Section 6.5(b), or any merger, amalgamation or consolidation for the sole purpose of changing the jurisdiction of formation of the Company or (y) apply to any Warrant Investor until such time as the Term Loans have been repaid in full in accordance with the Amended Credit Agreement. The Drag-Along Notice shall also specify (i) the consideration, if any, to be received by the Silver Lake Investors, the Management Investors and the Warrant Investors and any other material terms and conditions of the proposed Drag-Along Sale (which (x) price and form of consideration shall be the same for the Silver Lake Investors, the Management Investors and the Warrant Investors and (y) other material terms and, subject to Section 3.7(e), conditions shall be the same in all material respects for the Silver Lake Investors, the Management Investors and the Warrant Investors) and (ii) the identity of the other Person or Persons party to the Drag-Along Sale. Upon delivery of the Drag-Along Notice, each Management Investor and Warrant Investor shall be obligated to take the action or actions required of such Management Investor or Warrant Investor in order to complete or facilitate such proposed Drag-Along Sale is structured as (including the sale of Transferable Shares held by such Management Investor or Warrant Investor, the voting of all such Transferable Shares in favor of any merger, amalgamation, consolidation or sale of assets and the waiver of any applicable appraisal, dissenters’ or similar rights); provided, however, that, in the case of a sale of Shares, each Other with respect to any Shares for which a Management Investor holds exercisable and vested but unexercised Options, the price per Share shall sell be reduced by the exercise price of such Options or, if required pursuant to the terms of such Options or such Drag-Along Purchaser all Sale, such Management Investor shall exercise the relevant Option and transfer the relevant Shares then held by such Other Investor on (rather than the same terms and conditions as are applicable to the Drag-Along SellerOption) (in each case, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale net of any Round C Investors shall not amounts required to be less than withheld by the higher of (i) the Series A Liquidation Amount (as defined Company in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by connection with such Round C Investors (on an as-converted basisexercise); provided, further, that except with respect notwithstanding anything to the contrary set forth herein, in any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of event the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and be permitted to cause all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed outstanding Options to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth treated in such Drag-Along Sale Noticein any manner as permitted by their terms, which including any applicable equity plans of the Company; and provided, further, that with respect to any Transferable Shares that constitute Restricted Stock Units, to the extent that (x) any such Restricted Stock Units would not, by the express terms of the grant thereof, automatically vest and be settled in Shares immediately prior to the consummation of such Drag-Along Sale shall be promptly consummated, subject and (y) the counterparty to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the such Drag-Along Sale within does not agree to convert such 180-day period and Restricted Stock Units into comparable restricted stock units on securities of such Person, the Drag-Along Seller proposes to effect a Company may segregate the aggregate amount of Drag-Along Sale after consideration attributable to such 180-day periodRestricted Stock Units, and the Company (or its successor) shall deposit the applicable amounts of such Drag-Along Seller shall again comply with Sale consideration into escrow (or, if such deposit into escrow would result in a taxable event for a Management Investor prior to the procedures set forth satisfaction of the vesting criteria applicable to the Restricted Stock Units, receive such consideration as a general asset of the Company (or its successor) and maintain a book entry account in this Section 9.1(e). the name of each holder of such Restricted Stock Units on the books of the Company for the amount of such consideration due to each such holder) for release (for payment, as applicable) In connection with a to the holders of such Restricted Stock Units upon the satisfaction of the vesting criteria applicable thereto following such Drag-Along SaleSale (or, each Other Investor upon the failure of such vesting criteria to be satisfied, such consideration shall be released (or paid, as applicable) to (i) make such representationsthe Silver Lake Investors, warranties the Warrant Investors and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person Management Investors transferring Transferable Shares in connection with such Drag-Along Sale severallyand (ii) each other Person who is otherwise transferring, or has exercised a contractual or other right to transfer, Transferable Shares in connection with such Drag-Along Sale, in each case on a pro rata basis to each such Person in accordance with the amount of consideration otherwise received by each such Person in such Drag-Along Sale); and provided, further, that no Other Investor notwithstanding anything to the contrary set forth herein, in any event the Company shall be obligated permitted to indemnify cause all outstanding Restricted Stock Units to be treated in such Drag-Along Sale in any other shareholder manner as permitted by their terms, including any applicable equity plans of the Company. For the further avoidance of doubt, notwithstanding anything to the contrary, each Management Investor and Warrant Investor acknowledges and agrees that it shall not be entitled to any non-economic rights or benefits granted to the Silver Lake Investors or the Company in such Drag-Along Sale except for any breach those non-economic rights or misrepresentation benefits that are customary to be received by sellers of the relative portion of equity included in such Drag-Along Sale by such other shareholder with respect Management Investor and Warrant Investor under circumstances similar to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share Drag-Along Sale. If the Silver Lake Investors are transferring less than all of the Transferable Shares held by the Silver Lake Investors, then each Management Investor and Warrant Investor will transfer a number of Transferable Shares equal to the product of the following: (x) the number of Transferable Shares beneficially owned by such Management Investor or Warrant Investor multiplied by (y) a fraction, the numerator of which is the aggregate number of Transferable Shares being transferred by the Silver Lake Investors and the denominator of which equals the aggregate number of Transferable Shares beneficially owned by the Silver Lake Investors. All costs and expenses incurred by the Company Silver Lake Investors and the Company in connection with such Drag-Along Sale, together with the cost of one (1) legal counsel for the Management Investors in connection with such Drag-Along Sale in an amount not to exceed $50,000 and one (1) legal counsel for the proposed Warrant Investors in connection with such Drag-Along Sale in an amount not to exceed $50,000, shall either be (i) borne in full by the Company or (ii) allocated and borne by the Management Investors, the Warrant Investors, the Silver Lake Investors and each other Person who is otherwise transferring, or has exercised a contractual or other right to transfer, Transferable Shares in connection with such Drag-Along Sale, in each case on a pro rata basis to each such Person in accordance with the amount of consideration received by each such Person in such Drag-Along Sale. All other costs and expenses incurred by any Management Investor or Warrant Investor in connection with such transaction shall be borne in full by such Management Investor or Warrant Investor. (whether or not consummatedb) In connection with any Drag-Along Sale pursuant to this Section 3.7, (i) such Drag-Along Sale shall be on the terms and conditions the Silver Lake Investor(s) determine and (ii) each Management Investor and Warrant Investor shall agree to make the same representations, warranties, covenants, indemnities and agreements as made by the Silver Lake Investor(s) in connection with such Drag-Along Sale (except that in the case of representations, warranties, covenants, indemnities and agreements pertaining specifically to the Silver Lake Investor(s), each Management Investor and Warrant Investor shall make the comparable representations, warranties, covenants, indemnities and agreements pertaining specifically to itself); provided, that (A) all representations, warranties, covenants, indemnities and agreements shall be made by the Silver Lake Investor(s) and each Management Investor and Warrant Investor severally and not jointly and (B) any indemnification obligation in respect of breaches of representations and warranties that relate to the Company, its Subsidiaries or their respective businesses (1) shall be apportioned among the Management Investors, the Warrant Investors, the Silver Lake Investors and each other Person who is otherwise transferring, or has exercised a contractual or other right to transfer, Transferable Shares in connection with such Drag-Along Sale, in each case on a pro rata basis to each such Person in accordance with the amount of consideration received by each such Person in such Drag-Along Sale, and (2) shall be in an amount not to exceed the aggregate proceeds received by such Management Investor or Warrant Investor in connection with any such Drag-Along Sale consummated pursuant to this Section 3.7 and (D) the Warrant Investors shall not be required to agree to any non-competition, employee non-solicitation or similar restrictive covenants. (c) Notwithstanding the foregoing, each Management Investor and Warrant Investor shall take or cause to be taken all such reasonable actions as the Silver Lake Investor(s) deem to be necessary or desirable in order to consummate expeditiously such Drag-Along Sale pursuant to this Section 3.7, including all attorney’s fees (i) executing, acknowledging and chargesdelivering consents, all accounting fees assignments, waivers and charges other documents or instruments, (ii) filing applications, reports, returns, filings and all finders, brokerage other documents or investment banking fees, charges instruments with governmental authorities and (iii) otherwise cooperating with the Silver Lake Investor(s) and the other Person or commissions (including, if requested by Persons party to the Drag-Along SellerSale. Notwithstanding the delivery of any Drag-Along Notice, an investment banking firm selected all determinations as to whether to complete any Drag-Along Sale and as to the timing, manner, price and other terms and conditions of any such Drag-Along Sale shall be at the sole discretion of the applicable Silver Lake Investor(s) and the Silver Lake Investors and their Affiliates shall have no liability to any Management Investor or Warrant Investor arising from, relating to or in connection with the pursuit, consummation, postponement, abandonment or terms and conditions of any proposed Drag-Along Sale except to the extent such selling Silver Lake Investor failed to comply with the provisions of this Section 3.7. (d) If any Management Investor or Warrant Investor fails to transfer such Management Investor’s or Warrant Investor’s Transferable Shares required to be transferred or sold in such Drag-Along Sale pursuant to Section 3.7(a) (such Transferable Shares, “Drag Covered Transferable Shares”), the Silver Lake Investors may, at their option, in addition to all other remedies they may have, deposit the purchase price (including any promissory note constituting all or any portion thereof) for such Drag Covered Transferable Shares with any national bank or trust company having combined capital, surplus and undivided profits in excess of $500 million (the “Drag-Along Escrow Agent”), and thereupon all of such Management Investor’s or Warrant Investor’s rights in and to such Drag Covered Transferable Shares shall terminate. Thereafter, upon delivery to the Company by such Management Investor or Warrant Investor of appropriate documentation evidencing the transfer of such Drag Covered Transferable Shares to the purchaser in such Drag-Along Sale, the Silver Lake Investors shall instruct the Drag-Along Seller and engaged, on customary terms Escrow Agent to deliver the purchase price (including customary indemnification without any interest from the date of the closing of such Drag-Along Sale to the date of such delivery, as any such interest to accrue to the Company)) to such Management Investor or Warrant Investor. (e) In the event the consideration to be paid in exchange for Transferable Shares in a Drag-Along Sale includes any securities, and the receipt thereof by a Management Investor or Warrant Investor would require (i) the registration or qualification of such securities or of any Person as a broker or dealer or agent with respect to such securities, in each case under applicable law, where such registration or qualification is not otherwise required for the Drag-Along Sale by the applicable Silver Lake Investor(s) or (ii) the provision to any Management Investor or Warrant Investor of any specified information regarding such securities or the issuer thereof in order to obtain any exemption under securities laws or as otherwise required by applicable laws or the rules of any stock exchange where such information is not required to be provided to the applicable Silver Lake Investor(s), then the applicable Silver Lake Investor may elect to deliver to such Management Investor or Warrant Investor an amount of cash equal to the extent not paid fair market value (as determined by the Company, and (vapplicable Silver Lake Investor(s)) of the non-cash consideration that would otherwise be paid to the extent permitted by applicable Law, not exercise any dissenters’ such Management Investor or appraisal rights to which they may be entitled Warrant Investor in connection with a such Drag-Along Sale. (f) This Section 3.7 shall terminate upon an Initial Public Offering.

Appears in 2 contracts

Samples: Shareholder Agreements (SMART Global Holdings, Inc.), Shareholder Agreements (SMART Global Holdings, Inc.)

Drag-Along Rights. (a) IfIf (A) the Founder Parties propose to Transfer Founder Offered Shares in an amount equal to the greater of (1) a number of shares that represents a majority of the Class B Stock then Beneficially Owned by all Founders and their Permitted Transferees or (2) a number of shares that, at any time prior when taken together with all shares of Class B Stock previously Transferred to Persons other than Permitted Transferees or the Liberty Parties, represents a majority of the Class B Stock Beneficially Owned by the Founders and their Permitted Transferees as of the date hereof, in either case, pursuant to a Qualified IPOFounder Offer Notice or Founder Offer Notices delivered in accordance with Section 5, any Investor (B) the Liberty Parties fail to purchase such Founder Offered Shares and (C) the Founder Parties propose to Transfer such Founder Offered Shares to an unaffiliated third party that is not a Permitted Transferee, then the Controlling Principals may deliver a notice (a "Drag-Along Seller”Notice") secures an irrevocable offer to acquire all the Liberty Parties setting forth (w) the number of shares of Class B Stock proposed to be Transferred (which shall be the same as the number of Subject Shares subject to the applicable Founder Offer Notice), (x) the price per share capital at which the shares of Class B Stock are proposed to be Transferred (which shall be equal to or assets of greater than the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as price per share set forth in this Section 9.1the applicable Founder Offer Notice), (y) all Liens and Restrictions to which the shares of Class B Stock proposed to be Transferred will be subject, and (z) whether the Class B Stock proposed to be Transferred is to be sold for cash or other consideration and the other terms of the proposed Transfer. (b) If the Upon receipt of a Drag-Along Sale is structured as a sale of SharesNotice, each Other Investor shall sell the Liberty Parties will be required to Transfer to the Drag-Along Purchaser all Shares then held by such Other Investor on proposed transferee, at the same terms and conditions as are applicable to the Drag-Along SellerLiberty Parties' election, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) all shares of Class B Stock and Class C Stock Beneficially Owned by the Series A Liquidation Amount (Liberty Parties as defined in the Memorandum and Articles) or to which they have dispositive power, (ii) all shares of Common Stock Beneficially Owned by the purchase price Liberty Parties as stated to which they have dispositive power or (iii) the Proportionate Number of Shares Beneficially Owned by the Liberty Parties (and, in the offer case of a Transfer pursuant to this clause (iii), such Proportionate Number of Shares Beneficially Owned by the Drag-Along Purchaser pro rata based on Liberty Parties shall be comprised of shares of Common Stock of each class in the number same relative proportions as the Liberty Parties' aggregate Beneficial Ownership of Ordinary Shares held by each such Round C Investors (on an as-converted basisclass bears to the Liberty Parties' aggregate Beneficial Ownership of Common Stock of all classes); provided, furtherhowever, that except if, in connection with respect the proposed Transfer by the Founders, Xx. Xxxx X. Schneider, X. Xxxxxxxxx Holdings, Co., a Colorado limited partnership, The Xxxx X. Xxxxxxxxx Family Trust, Xx. Xxxx X. Schneider and The MLS Family Partnership LP propose to any liability incurred Transfer to the proposed transferee all shares of Common Stock Beneficially Owned by such Other Investor individuallythem, such Other Investor shall not which shares of Common Stock include shares of Class B Stock representing at least 40% of the greater of (x) the number of shares of Class B Stock Beneficially Owned by them in the aggregate as of the date hereof and (y) the number of shares of Class B common stock of Old United Beneficially Owned by them in the aggregate as of June 25, 2000, in each case appropriately adjusted for stock splits, stock dividends and other similar events, then the Liberty Parties will be liable required to a Drag-Along Purchaser for an amount greater than Transfer to the proceeds from such saleproposed transferee all shares of Common Stock Beneficially Owned by them as to which they have dispositive power. (c) If The Liberty Parties may require that any Transfer with respect to which the Founders exercise their Drag-Along Sale is Rights be structured as a merger, amalgamation or scheme transaction in which all holders of arrangement Class B Stock and Class C Stock are treated equally with respect to all shares of Common Stock being transferred and that is a tax-free transaction for the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along SaleLiberty Parties. (d) The Upon exercise by the Founders of Drag-Along Seller Rights, the terms on which the Liberty Parties actually Transfer their Common Stock shall provide written notice not be less favorable, and (subject to clause (c) above) shall not include less cash, than the terms on which the Founder Parties Transfer their Class B Stock. The Liberty Parties may be required to make the same representations, warranties, covenants and agreements as are given by the Founder Parties in connection with any Transfer pursuant to this Section 8, but only insofar as they relate to the Liberty Parties' ownership of a proposed the Common Stock subject to the Transfer, are representations or warranties regarding approval, authorization or enforceability of such action, or are covenants or agreements to the effect that the Liberty Parties will take such commercially reasonable actions as may be necessary for the Transfer to lawfully occur and which the Founder Parties have also agreed to take (other than any such action which can reasonably be taken only by the Founders). Upon exercise by the Founders of Drag-Along Sale Rights, the Founders shall cause the documents relating to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior Transfer of their Class B Stock to the proposed transferee to be amended so that such documents include as parties the Liberty Parties, and so as to provide that the proposed Drag-Along Saletransferee shall acquire from the Liberty Parties the number of shares of Common Stock determined in accordance with Section 8(b). The Drag-Along Sale Notice shall identify the Drag-Along PurchaserExcept as otherwise required in order to satisfy Section 8(c), the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions closing of the Drag-Along Sale. Each Other Investor shall be required sale of Common Stock by the Liberty Parties pursuant to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company))8 shall, to the extent not paid legally practicable, take place at the same time and place as the closing of the Transfer by the CompanyFounder Parties. At such closing, (x) the Liberty Parties shall deliver to the transferee certificates representing the Common Stock subject to the Transfer, free and clear of any Lien or Restriction (if the Founder Parties' shares are being transferred free and clear of any Lien or Restriction) other than those created by this Agreement, any other Transaction Agreement or the transferee, (y) the transferee shall deliver to the Liberty Parties the consideration to be paid for such Common Stock in accordance with the terms of the purchase and sale of such Common Stock and of the Class B Stock of the Founder Parties, and (vz) subject to the preceding paragraph, the Liberty Parties shall, to the same extent permitted as the Founder Parties with respect to the Class B Stock being transferred by applicable Lawthem, not exercise any dissenters’ or appraisal rights to which they execute such other documents and take such other commercially reasonable actions as may be entitled necessary to consummate the sale of such Common Stock (other than any such action which can reasonably be taken only by the Founders). Any shares of Class C Stock Transferred to a transferee pursuant to this Section 8 shall be converted immediately following such Transfer to Class A Stock or, if (i) then permissible under the United Charter or (ii) such conversion would not result in connection with a Drag-Along Sale"Change of Control" pursuant to the Current Indentures as then in effect, Class B Stock.

Appears in 2 contracts

Samples: Agreement and Plan of Restructuring and Merger (Liberty Media Corp /De/), Agreement and Plan of Restructuring and Merger (New Unitedglobalcom Inc)

Drag-Along Rights. (a) IfIf Capricorn approves or authorizes a sale or exchange, at any time prior whether directly or pursuant to a Qualified IPOmerger, any Investor consolidation or otherwise (the “Drag"Company Sale"), of at least a majority of the then outstanding Common Stock in a bona fide arm's-Along Seller”) secures length transaction to a third party that is not an irrevocable offer to acquire all share capital Affiliate of Capricorn or assets of the Company (a “Drag-an "Independent Third Party"), then Capricorn shall have the right, subject to all the provisions of this Section 4.4 (the "Drag- Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such PersonRight"), a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote require each of the other Investors and a majority vote of the Founders, each other Investor Shareholders to (an “Other Investor”i) agrees, at the request of the Drag-Along Seller, to participate in if such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Company Sale is structured as a sale of Sharesstock, sell, transfer and deliver or cause to be sold, transferred and delivered to such Independent Third Party all shares of Common Stock, and other options, warrants or rights to subscribe for or purchase Common Stock (the "Other Rights"), owned by them; provided, -------- however, that if Capricorn agrees to sell less than all (the "Amount") of its ------- shares of Common Stock to such Independent Third Party, each of the other Shareholders shall only be required to sell, transfer and deliver to such Independent Third Party an amount of shares of Common Stock and Other Investor shall sell Interests equal to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class shares of SharesCommon Stock, and shall execute Other Interests, owned by it multiplied by a fraction the necessary transfer forms in favor numerator of which is the Drag-Along Purchaser; provided that Amount and the proceeds from such sale denominator of any Round C Investors shall not be less than which is the higher total amount of (i) the Series A Liquidation Amount (as defined in the Memorandum shares of Common Stock, and Articles) Other Interests, owned by Capricorn or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by if such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Company Sale is structured as a merger, amalgamation consolidation or scheme other transaction requiring the consent or approval of arrangement the Company's shareholders, vote such Shareholder's shares of Voting Stock in favor thereof, and otherwise consent to and raise no objection to such transaction, and waive any dissenters' rights, appraisal rights or similar rights that such Shareholder may have in connection therewith; and, in any such event, except to the extent otherwise provided in subsection (c) of this Section 4.4, each such other Shareholder shall agree to and shall be bound by the same terms, provisions and conditions (including, without limitation, provisions in respect of indemnification) in respect of the Company or other transaction that requires the approval Sale as are applicable to Capricorn. The provisions of the InvestorsSections 4.1 through 4.3 hereof, each Investor inclusive, shall vote its respective Shares not apply to any transactions to which this Section 4.4 applies. (or execute and deliver any written consents in lieu thereofb) in favor of any If Capricorn desires to exercise Drag-Along Sale and all actions deemed reasonably necessary by Rights, it shall give written notice to the other Shareholders (the "Drag-Along Seller Notice") of the Company Sale, setting forth the name and address of the transferee, the date on which such transaction is proposed to be consummated (which shall be not less than 30 days after the date such Drag-Along Notice is given), and the proposed amount and form of consideration and terms and conditions of payment offered by such transferee, including, without limitation, the material terms of any debt or equity securities proposed to be included as part of such consideration, identifying the issuer or issuers thereof. If such consideration includes any non-cash consideration, such notice shall also state the fair market value of such non-cash consideration and shall describe in reasonable detail the method by which such value shall have been determined. (c) The obligations of the Shareholders in respect of a Company Sale under this Section 4.4 are subject to the satisfaction of the following conditions: (i) upon the consummation of the Company Sale, the same form of consideration and the same portion of the aggregate consideration realized upon such Company Sale shall be paid or distributed in respect of each share of Common Stock then issued and outstanding (except as contemplated by the proviso to Section 4.4 (a) hereof); (ii) if any Shareholder is given an option as to the form and amount of consideration to be received, each Shareholder will be given the same option; (iii) each holder of then currently vested rights to acquire shares of Common Stock will be given a reasonable opportunity to exercise such rights prior to the consummation of the Company Sale and thereby to participate in such sale as a holder of such Common Stock; (iv) the maximum liability of any Shareholder for indemnification in respect of all matters arising pursuant to or in connection with the Drag-Along Company Sale shall not exceed the net proceeds received by such Shareholder from such Company Sale, ; and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (dv) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor no Shareholders shall be required to participate in make general representations or warranties regarding the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form financial condition, business, assets or affairs of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Saleits Subsidiaries.

Appears in 2 contracts

Samples: Stockholders' Agreement (MRS Fields Brand Inc), Stockholders' Agreement (MRS Fields Holding Co Inc)

Drag-Along Rights. In the event that ArcLight shall determine to sell or exchange (ain a business combination or otherwise) Ifall, at any time prior and not less than all, of the Shares held by ArcLight collectively with its Permitted Transferees (as such term is defined with respect to ArcLight in the Principal Stockholders Agreement), in a Qualified IPObona fide arm’s-length transaction, any Investor then, upon the written notice of ArcLight (the “Drag-Drag Along SellerSale Notice) secures an irrevocable offer to acquire all share capital or assets of ), the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along SellerManagement Stockholders shall be obligated to, and such Drag-Along Sale is agreed by a majority vote of shall, sell, transfer and deliver, or cause to be sold, transferred and delivered, to the other Investors party, (i) in the case of Shares acquired by exercise of an Option, all and a majority vote not less than all of the Founders, each other Investor (an “Other Investor”) agreessuch Shares, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor same price per share and on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration ArcLight collectively with its Permitted Transferees (as such term is defined with respect to ArcLight in the Principal Stockholders Agreement), and set forth in the Drag Along Sale Notice, (ii) in the case of Shares acquired by exercise of a specific class Stock Purchase Right, all and not less than all of such Shares, at the same price per share and on the same terms applicable to ArcLight collectively with its Permitted Transferees, and set forth in the Drag Along Sale Notice, provided that, if the sale does not result in a 8% per annum rate of return on the aggregate amount paid by the Management Stockholder to acquire such Shares (less the present value of any dividends or other distributions received by the Management Stockholder with respect to such Shares) (the “8% Return Rate”), then the Company shall execute pay to the necessary transfer forms Management Stockholders an amount equal to the difference between the price per share paid by the other party and a price representing an 8% Return Rate, which amount shall be payable in favor a single cash lump sum within 30 days after the closing of the Drag-Along Purchasersale; provided that the proceeds from liability of each Management Stockholder to the prospective purchaser in connection with such sale of any Round C Investors transaction shall not be less than under any circumstances exceed the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held consideration received by such Round C Investors (on an as-converted basis); providedManagement Stockholder in connection therewith and all representations, furtherwarranties and covenants given in connection with such transaction shall be several and not joint, that except or if they are not several, then the Management Stockholders shall have entered into a contribution agreement to bear, among themselves, liability to the purchaser in connection with such transaction in proportion to the amount of consideration received in such transaction by each Management Stockholder and to bear full liability with respect to any liability incurred by such Other Investor individuallybreaches of representations, such Other Investor shall warranties and covenants with respect to which other Management Stockholders would not be have been liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make had such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale been given severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Salejointly.

Appears in 1 contract

Samples: Management Stockholders Agreement (Myr Group Inc)

Drag-Along Rights. (a) IfWithout limiting the other terms and conditions hereof (including Section 4.1), if at any time prior to one (1) or more Shareholders (a Qualified IPO, any Investor (the “Drag-Along Seller”) secures an irrevocable offer proposes to acquire all share capital Transfer for a cash purchase price sixty-five percent (65%) or assets more of the then Outstanding Company Shares, in a single transaction or series of related transactions that is intended to result in the sale of all of the then Outstanding Company Shares to a purchaser that is not an Affiliate of any such selling Shareholder (a “Drag-Along Sale”) with a valuation of ), then the Drag-Along Seller may elect to require the Company of more than US$600,000,000 with any Person to (such Personand if the Drag-Along Seller so elects, a the Company shall) send written notice (the “Drag-Along PurchaserNotice”) upon to all other Shareholders notifying them that they will be required to (and each of such other Shareholders shall (subject to the terms and conditions as of this Article IV) be required to) sell their shares of Company Shares and, unless otherwise agreed to with by the Drag-Along SellerSeller(s) to the extent permissible under any applicable Equity Incentive Plan, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate their Derivative Securities in such Drag-Along Sale on the same terms (including the price per share and the type of consideration to be received and receipt of the proceeds at the same time) and subject to the same conditions (except as set forth in the provisos in Section 4.5(a)), which notice may be provided by posting it to a Secure Site and notifying (or causing notification to be delivered to) each of such other Shareholders of such posting in writing. Notwithstanding any other provision of this Section 9.14.4 to the contrary, (i) any Drag-Along Sale must satisfy the applicable conditions set forth in Section 4.2 (provided that the parties hereto acknowledge and agree that Section 4.2(c) shall not apply to, and clauses (iii) and (iv) of the definition of “Prohibited Person” shall be disregarded in connection with, a Transfer pursuant to a Drag-Along Sale) and otherwise be a Permitted Transfer and (ii) in connection with any Drag-Along Sale, the rights and obligations of holders of Derivative Securities or any other equity awards issued pursuant to an Equity Incentive Plan, and the treatment of any such Derivative Securities or such other equity awards, shall be subject to the terms and conditions of the Equity Incentive Plan applicable to such Derivative Securities or such other equity awards, as applicable. The Drag-Along Seller will deliver or cause to be delivered to the Company, and the Company will deliver to all other Shareholders, copies of all transaction documents relating to the Drag-Along Sale as the same become available. (b) If In the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided event that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme sale of arrangement substantially all of the Company assets, consolidation or similar business combination, each Shareholder hereby agrees to vote in favor of the transaction (including acting by written consent, if requested) and take all action to waive any dissenters, appraisal or other transaction similar rights such Shareholder may have. Each Shareholder affirms that requires its agreement to vote for the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any such a Drag-Along Sale is given as a condition of this Agreement and all actions deemed as such is coupled with an interest and is irrevocable. This voting agreement shall remain in full force and effect throughout the time that this Section 4.4 is in effect. (c) If a Drag-Along Sale has not been consummated within one hundred and eighty (180) days following delivery of the related Drag-Along Notice (which such one hundred and eighty (180)-day period may be extended for a reasonable time not to exceed an additional ninety (90) days to the extent reasonably necessary by to obtain any necessary regulatory approvals), the Drag-Along Seller in connection with the Notice shall be null and void, each Shareholder shall be released from his, her or its obligation under such Drag-Along Sale, Notice and against any action or proposal that may prevent, hinder or impede the consummation of the it shall be necessary for a separate Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) furnished and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth provisions of this Section 4.4 separately complied with, in the Drag-Along Sale Notice and order to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in subsequently consummate such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject pursuant to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e)4.4. (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 1 contract

Samples: Shareholders Agreement (Vantage Drilling International)

Drag-Along Rights. (aA) IfIf Xxxxxxx-Xxxxx agrees to transfer, at any time prior to a Qualified IPOsell or otherwise dispose of, any Investor directly or indirectly, shares of Common Stock, which transfer, sale or other disposition (together with transfers, sales or other dispositions by other members of the “Drag-Along Seller”KL Selling Group) secures an irrevocable offer to acquire all share capital or assets would effectively transfer control of the Company to the Purchasers thereof including but not limited to circumstances under which such Purchasers would hold more shares of Common Stock than Xxxxxxx- Xxxxx (a "Drag-Along Sale”) with a valuation "), then upon the demand of Xxxxxxx-Xxxxx, each of the Company of more than US$600,000,000 with any Person (such PersonTrust, a “Drag-Along Purchaser”) upon such terms Matzorkis and conditions as agreed to with the Drag-Along Sellerhis Affiliates shall transfer, and such Drag-Along Sale is agreed by a majority vote sell or otherwise dispose of the other Investors and a majority vote same pro rata amount of the Founders, each other Investor (an “Other Investor”) agrees, at the request their respective outstanding shares of the Drag-Along Seller, to participate Common Stock in such Drag-Along Sale as set forth the KL Selling Group proposes to transfer, sell or otherwise dispose of its shares of Common Stock in such Drag-Along Sale; provided, however, that this Section 9.1provision shall not apply if such sale is to Xxxxxxx-Xxxxx, any of its subsidiaries, Xxxxxx Xxxxxxx or Xxxxx Xxxxx unless either (i) the Company has obtained a fairness opinion from a qualified valuation consultant, investment bank or certified public accounting firm as to the consideration to be received by the selling shareholders, or (ii) the transaction is approved by a majority of the shareholders of the Company (excluding Xxxxxxx-Xxxxx). (bB) If Any such sale or disposition by the Drag-Along Sale is structured as a sale of SharesTrust, each Other Investor Matzorkis and his Affiliates shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor be on the same terms and conditions conditions, including without limitation as are applicable to the Drag-Along Sellerform of consideration, including as the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the proposed Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller KL Selling Group. The Trust, Matzorkis and his Affiliates shall be required to make customary and usual representations and warranties in connection with the Drag-Along Sale, including, without limitation, as to their ownership and against authority to sell, free of all liens, claims and encumbrances of any action kind, the shares of Common Stock proposed to be transferred or proposal that may preventsold by such persons or entities and shall, hinder or impede without limitation as to time, indemnify and hold harmless to the consummation full extent permitted by law, Xxxxxxx-Xxxxx and the other members of the KL Selling Group and the Purchasers against all obligations, cost, damages, expenses, losses, judgments, assessments, or other liabilities including, without limitation, any special, indirect, consequential or punitive damages, any court costs, costs of preparation, attorney's fees or expenses, or any accountant's or expert witness' fees arising out of, in connection with or related to any breach or alleged breach of any representation or warranty made by, or agreements, understandings or covenants of, the Trust, Matzorkis or his Affiliates under the terms of the agreements relating to such Drag-Along Sale. (dC) The Drag-Along Seller shall provide written notice of a proposed Prior to making any Drag-Along Sale in which Xxxxxxx-Xxxxx wishes to exercise its rights under Section 5(a), Xxxxxxx-Xxxxx shall provide the Other Investors Trust and Matzorkis with written notice (a “the "Drag-Along Sale Notice") not later less than ten (10) days prior to such the proposed date of the Drag-Along SaleSale (the "Drag-Along Sale Date"). The Drag-Along Sale Notice shall identify set forth: (i) the Drag-Along Purchaser, name and address of the per-Ordinary Share Purchasers; (ii) the proposed amount and form of consideration for which a transfer is proposed to be made (paid per share of Common Stock, and the “Drag-Along Sale Price”) and all other material terms and conditions of payment offered by each of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. Purchasers; (eiii) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for (the Drag-"Drag- Along Sale Notice Date"); (iv) the number of shares of Common Stock held of record by the KL Selling Group on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature date of the Drag-Along SaleNotice; (v) the number of shares of Common Stock to be transferred, sold or otherwise disposed of by the KL Selling Group; (iivi) benefit from and be subject to all the number of shares Common Stock of the same provisions of the definitive agreements as are applicable Trust, Matzorkis and his Affiliates to be included in the Drag-Along Seller, Sale; and (iiivii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Drag- Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleDate.

Appears in 1 contract

Samples: Shareholders' Agreement (Us Search Corp Com)

Drag-Along Rights. (a) IfFor so long as the Sponsors directly or indirectly hold, at any time prior in the aggregate, greater than forty percent (40%) of the outstanding Company Shares and one or more Sponsors agree to enter into a Qualified IPO, any Investor transaction which would result in the Transfer of greater than forty percent (the “Drag-Along Seller”40%) secures an irrevocable offer to acquire all share capital or assets of the Company Shares to a non-Affiliate third party (a “Drag-Along SaleBuyer”), such Sponsor(s) (the “Selling Stockholders”) with a valuation of may compel each other Stockholder (together, the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along PurchaserStockholders”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed sell its Company Shares by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide delivering written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along PurchaserStockholders not later than three (3) Business Days prior to the consummation of the proposed Transfer, stating that such Selling Stockholders wish to exercise their rights under this Section 4.05 with respect to such Transfer, and setting forth the name and address of the Drag-Along Buyer, the per-Ordinary Share consideration for which a transfer is number and class(es) of Company Shares proposed to be made (Transferred, the “Drag-Along Sale Price”) proposed amount and form of the consideration, and all other material terms and conditions offered by the Drag-Along Buyer; provided, that if a Drag-Along Stockholder (or in the case of Co-Invest, Co-Invest II or Co-Invest III, their respective members) advise the Sponsors that they desire to participate in such transaction without having to be compelled, the Company Shares that would be Transferred by such Drag- Along Stockholder (or in the case of Co-Invest, Co-Invest II or Co-Invest III, their respective members) to a Drag-Along Buyer may be included in determining whether or not a proposed transaction would result in the Transfer of greater than forty percent (40%) of the Company Shares to the extent a Drag-Along Stockholder consents to such treatment, and provided further, that in order for one Sponsor to exercise its drag-along rights under this Section 4.05, it must receive the consent of the other Sponsor, such consent being required for so long as such other Sponsor, together with its Affiliates, beneficially owns at least five percent (5%) of the outstanding Company Shares. (b) Upon delivery of a Drag-Along Notice, each Drag-Along Stockholder shall be required to Transfer its Pro Rata Portion, on the same terms and conditions (including, without limitation, as to price, time of payment and form of consideration) as agreed by the Selling Stockholders and the Drag-Along Buyer, and shall make to the Drag-Along Buyer representations, warranties, covenants, indemnities and agreements comparable to those made by the Selling Stockholders in connection with the Transfer (other than any non-competition, non- solicitation or similar agreements or covenants that would bind the Drag-Along Stockholder, its Affiliates or any of their respective portfolio companies), and shall agree to the same conditions to the Transfer as the Selling Stockholders agree, it being understood that all such representations, warranties, covenants, indemnities and agreements shall be made by each Selling Stockholder and each Drag-Along Stockholder severally and not jointly and that the aggregate amount of the liability of the Drag-Along Sale. Each Other Investor Stockholder shall be required not exceed, except with respect to participate in individual representations, warranties, covenants, indemnities and other agreements of the Drag-Along Sale on Stockholder as to the unencumbered title to its Company Shares and the power, authority and legal right to Transfer such Company Shares, such Drag-Along Stockholder’s pro rata share of any such liability, to be determined in accordance with such Drag-Along Stockholder’s portion of the total number of Company Shares included in such Transfer; provided that, in any event the amount of liability of any Drag-Along Stockholder shall not exceed the proceeds such Drag-Along Stockholder received in connection with such Transfer. (c) In the event that any such Transfer is structured as a merger, consolidation, or similar business combination, each Drag-Along Stockholder agrees to (i) vote in favor of the transaction, (ii) take such other action as may be reasonably required to effect such transaction (subject to Section 4.05(b)) and (iii) take all action to waive any dissenters, appraisal or other similar rights with respect thereto. (d) Solely for purposes of Section 4.05(c)(i) and in order to secure the performance of each Stockholder’s obligations under Section 4.05(c)(i), each Stockholder hereby irrevocably appoints each other Stockholder that qualifies as a Drag-Along Proxy Holder (as defined below) the attorney-in-fact and proxy of such first Stockholder (with full power of substitution) to vote or provide a written consent with respect to its Company Shares as described in this paragraph if, and only in the event that, such Stockholder fails to vote or provide a written consent with respect to its Company Shares in accordance with the terms of Section 4.05(c)(i) (each such Stockholder, a “Breaching Drag-Along Stockholder”) within three (3) days of a request for such vote or written consent. Upon such failure, the Selling Stockholders or any of them shall have and conditions are hereby irrevocably granted a proxy to vote or provide a written consent with respect to each such Breaching Drag-Along Stockholder’s Company Shares for the purposes of taking the actions required by Section 4.05(c)(i) (such Selling Stockholders each and collectively, a “Drag-Along Proxy Holder”). Each Stockholder intends this proxy to be, and it shall be, irrevocable and coupled with an interest, and each Stockholder will take such further action and execute such other instruments as may be reasonably necessary to effectuate the intent of this proxy and hereby revokes any proxy previously granted by it with respect to the matters set forth in Section 4.05(c)(i) with respect to the Drag-Along Sale Notice and to tender its SharesCompany Shares owned by such Stockholder. The price and form of consideration payable in such transfer Notwithstanding the foregoing, the conditional proxy granted by this Section 4.05(d) shall be deemed to be revoked upon the Drag-Along Sale Pricetermination of this Article IV in accordance with its terms. (e) The If any Drag-Along Seller Stockholder fails to deliver to the Drag-Along Buyer the certificate or certificates, if any, evidencing Company Shares to be sold pursuant to this Section 4.05, the Selling Stockholders may, at their option, in addition to all other remedies they may have, deposit the purchase price (including any promissory note constituting all or any portion thereof) for such Company Shares with any national bank or trust company having combined capital, surplus and undivided profits in excess of $100 million (the “Escrow Agent”), and the Company shall have a period cancel on its books the certificate or certificates representing such Company Shares and thereupon all of 180 days such Drag-Along Stockholder’s rights in and to such Company Shares shall terminate. Thereafter, upon delivery to the Company by such Drag-Along Stockholder of the certificate or certificates evidencing such Company Shares (duly endorsed, or with stock powers duly endorsed, for transfer, with signature guaranteed, free and clear of any liens or encumbrances, and with any stock transfer tax stamps affixed), the Selling Stockholders shall instruct the Escrow Agent to deliver the purchase price (without any interest from the date of receipt the closing to the date of such delivery, any such interest to accrue to the Drag-Along Sale Notice Company) to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e)Stockholder. (f) In connection with the event that a Drag-Along SaleStockholder receives securities which are Illiquid Securities as proceeds in connection with a Transfer pursuant to this Section 4.05, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from Stockholder shall receive the right to tag-along on transfers by any Stockholder and be subject to all drag-along rights of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder Sponsors with respect to title in such other shareholder’s equity securities, (iv) be required securities that are substantially similar to bear its proportionate share of the costs tag-along rights and expenses incurred by drag-along rights applicable to Company Shares under this Agreement and shall receive registration rights with respect to such securities that are substantially similar to the Company and registration rights applicable to “Registrable Securities” under the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), Registration Rights Agreement to the extent not paid received by the CompanySponsors, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal provided that such rights to which they may be entitled in connection with a Drag-Along Saleshall cease at such time as such securities are no longer Illiquid Securities.

Appears in 1 contract

Samples: Stockholders’ Agreement (Avaya Holdings Corp.)

Drag-Along Rights. (a) IfSubject to Section 4.5(b), at any time the H&F Investors may give notice to the Non-H&F Stockholders (and prior to delivering such notice, each H&F Investor agrees to discuss such proposed transfer with each other H&F Investor sufficiently in advance so as to enable such other H&F Investors to join in such notice and participate in such proposed transfer) that the H&F Investors intend to enter into (or have agreed to vote the Share Equivalents they beneficially own, or to execute a Qualified IPOwritten consent in lieu thereof, any Investor in favor of) a transaction or transactions involving the transfer, in a single transaction or a series of related transactions, of not less than fifty percent (the “Drag-Along Seller”50%) secures an irrevocable offer to acquire all share capital or assets of the outstanding Share Equivalents (which Share Equivalents to be transferred may include Share Equivalents held by the Non-H&F Stockholders and/or other holders of Share Equivalents) to one or more Persons (other than to an Affiliate of the H&F Investors) or to cause the Company to merge or consolidate with, or sell all or substantially all of its assets to, another Person or Persons (other than an Affiliate of the H&F Investors) (a “Drag-Along Sale”) with a valuation of and that the Company of more than US$600,000,000 with any Person (such Person, a “DragH&F Investors desire to cause the Non-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, H&F Stockholders to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor transaction on the same terms and conditions as are applicable available to the Drag-Along SellerH&F Investors (including any preemptive rights), including making the same per-share consideration with respect representations, warranties, covenants, indemnities and agreements as the H&F Investors agree to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller make in connection with the Drag-Along Sale, on a several and against any action or proposal that may preventnot joint basis, hinder or impede pro rata with the consummation H&F Investors based upon the number of the Share Equivalents included in such Drag-Along Sale. (d) The Drag; provided that any indemnification obligations of any Non-Along Seller H&F Stockholder with respect thereto shall provide written notice of a proposed Dragin no event exceed the proceeds received by such Non-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to H&F Stockholder in such proposed Drag-Along Sale. The Drag-Along Sale Notice Such notice shall identify also specify (i) the Drag-Along Purchaserconsideration, the per-Ordinary Share consideration for which a transfer is proposed if any, to be made (received by the “DragH&F Investors and the Non-Along Sale Price”) H&F Stockholders and all any other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the proposed Drag-Along Sale on the (which price and other material terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Dragsame in all material respects for the H&F Investors and the Non-Along Sale Price. H&F Stockholders), (eii) The Drag-Along Seller shall have a period of 180 days from the date of receipt identity of the Drag-Along Sale Notice other Person or Persons party to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (iiiii) benefit from and be subject to all the date of anticipated completion of the same provisions of the definitive agreements as are applicable to the proposed Drag-Along SellerSale (which date shall be not less than ten (10) days after the date of the notice) and (iv) the action or actions required of each Non-H&F Stockholder in order to complete or facilitate such proposed Drag-Along Sale (including the sale of Share Equivalents held by the Non-H&F Stockholder, (iii) be required to bear its proportionate share the voting of all such Share Equivalents in favor of any escrowssuch merger, holdbacks consolidation or adjustments in respect sale of assets and the purchase price waiver of any related appraisal or indemnification obligations; provided that an Other Investor dissenters’ rights). Upon receipt of such notice, each Non-H&F Stockholder shall only be obligated to indemnify take the action or actions referred to in clause (iv) above; provided, however, that, in the case of a sale of Shares, with respect to (A) any Shares for which a Stockholder holds exercisable and vested but unexercised Options or (B) any other Person Securities exercisable for, convertible into or exchangeable for Shares, the price per Share shall be reduced by the exercise price of such Options or other Securities or, if required pursuant to the terms of such Options or other Securities or such Drag-Along Sale, such Stockholder must exercise the relevant Option or other Security (which may include an exercise effected on a “net exercise” basis) or exercise, convert or exchange such other relevant Security and transfer the relevant Shares (rather than the Option or other Security) (in each case, net of any amounts required to be withheld by the Company in connection with such exercise); and provided, further, that, notwithstanding anything to the contrary set forth herein, in any event the Company shall be permitted to cause all outstanding Options to be treated in such Drag-Along Sale severally; providedin any manner as permitted by their terms, furtherincluding any applicable equity plans of the Company. If the H&F Investors are transferring less than all of the Share Equivalents held by the H&F Investors, that no Other Investor shall be obligated then each Non-H&F Stockholder will transfer a number of Share Equivalents equal to indemnify any other shareholder for any breach or misrepresentation the product of the following: (x) the number of Share Equivalents beneficially owned by such other shareholder with respect to title in such other shareholder’s equity securitiesNon-H&F Stockholder multiplied by (y) a fraction, (iv) be required to bear its proportionate share the numerator of which is the costs and expenses incurred aggregate number of Share Equivalents being transferred by the Company H&F Investors and the Investors in connection with denominator of which equals the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested aggregate number of Share Equivalents beneficially owned by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to H&F Investors. To the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled consideration received in connection with a Drag-Along Sale consists of Nonmarketable Securities, then the Stockholders shall continue to have the same rights, and the H&F Investors shall continue to have the same obligations, with respect to such Nonmarketable Securities as such Persons have with respect to Share Equivalents pursuant to Section 4.4. All costs and expenses incurred by the H&F Investors in connection with such transaction shall be borne on a pro rata basis in accordance with the number of Share Equivalents being sold by each of the H&F Investors, the Non-H&F Stockholders and all other Persons who otherwise are transferring, or have exercised a contractual or other right to transfer, Share Equivalents in connection with such transaction. (b) This Section 4.5 shall terminate upon the expiration of the Transfer Restriction Period, provided that in order for the H&F Investors to exercise their rights under this Section 4.5, either (x) the H&F Investors must beneficially own, in the aggregate, at least twenty-five percent (25%) of the outstanding Shares or (y) shareholders (including the H&F Investors) that beneficially own, in the aggregate, not less than fifty percent (50%) of the outstanding Shares must have approved the Drag-Along Sale.

Appears in 1 contract

Samples: Shareholder Agreement (Goodman Sales CO)

Drag-Along Rights. (a) If, If at any time prior to the Registration Period Commencement Date, JLL Building Products proposes to Transfer all or substantially all of its shares of Common Stock (other than to a Qualified IPOPermitted Transferee), any Investor JLL Building Products shall have the right, upon not less than twenty (20) days’ prior written notice of such proposed sale (the “Drag-Along SellerPurchase Notice) secures an irrevocable offer to acquire ), which notice shall include all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed of such proposed sale and which notice shall identify the proposed purchaser or purchasers of such shares of Common Stock (“Drag Along Purchaser(s)”), to require each of the Other Stockholders to sell to the Drag Along Purchaser(s) that number of Shares (“Call Shares”) equal to the product, rounded down to the nearest whole number, of (a) a fraction, the numerator of which is the total number of shares of Common Stock proposed to be sold by JLL Building Products, together with the Drag-Along Sellerits Permitted Transferees, and such Drag-Along Sale the denominator of which is agreed the total number of shares of Common Stock then owned by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. JLL Building Products multiplied by (b) If the Drag-Along Sale is structured as a sale number of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held owned by such Other Investor on Stockholder. If JLL Building Products shall so elect, JLL Building Products shall arrange for such Drag Along Purchaser(s) to purchase the Call Shares at the same time as and upon the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class at which JLL Building Products sells its shares of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along SaleCommon Stock. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of Upon receipt of the Drag-Along Sale Notice Purchase Notice, each of the Other Stockholders shall cooperate with JLL Building Products and otherwise take, or cause to be taken, all actions and do, or cause to be done, all things necessary or appropriate to enter into a definitive agreement providing for into, consummate, and make effective the Drag-Along Sale on the terms sale and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions purchase of the nature Call Shares, together with JLL Building Products’ shares of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleCommon Stock being so Transferred.

Appears in 1 contract

Samples: Stockholders Agreement (Builders FirstSource, Inc.)

Drag-Along Rights. In accordance with Article VIII, all of the provisions of Section 5.5 shall terminate and be of no further force or effect, effective as of the consummation of an Initial Public Offering. (a) IfNotwithstanding any other provision in this Article V, if the CSFB Parties and their Permitted Transferees (such parties being referred to in this Section 5.5 as the "Seller") propose to sell all of the Shares held by such parties at such time (the "CSFB Shares") to a third party or parties that are not Permitted Transferees of the Seller (collectively, a "Third Party") pursuant to a Bona Fide Offer, then the Seller shall have the right to require all other Shareholders (collectively, the "Co-Sellers") to include in such sale (a "Required Sale") all of such Co-Seller's Shares; provided, however, (i) at any time prior to a Qualified IPO, any Investor (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets fifth anniversary of the Company date of this Agreement, (a “Drag-Along Sale”A) with a valuation the Shares held by the CSFB Parties shall constitute not less than 50% of the Company Diluted Common Stock and (B) if CCBM or Carrizo and US Energy or Crested each own Shares and each of more than US$600,000,000 with any Person (such PersonCCBM or Carrizo and US Energy or Crested then shall be entitled to nominate and have elected at least one Director pursuant to Section 3.2, a “Drag-Along Purchaser”) upon such terms and conditions then at least one of CCBM or Carrizo, as agreed to with the Drag-Along Sellercase may be, and US Energy or Crested shall have consented in writing to such Drag-Along Sale is agreed Required Sale, and (ii) on or at any after the fifth anniversary but prior to the seventh anniversary of this Agreement, the Shares held by a majority vote the CSFB Parties shall constitute not less than 50% of the Diluted Common Stock. For the avoidance of doubt, on or at any time after the seventh anniversary of this Agreement, the Seller's right to require all other Investors and Co-Sellers to include all of such Co-Sellers' Shares in a majority vote of Required Sale shall be conditioned only on the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as provisions set forth in this Section 9.15.5(e) and the inclusion of all of the Seller's Shares in such Required Sale. (b) If Each of the Drag-Along other Holders shall have an optional preferential right, exercisable by giving written notice stating that such notice is binding and irrevocable to the Seller at any time prior to the 15th Business Day after its receipt of the Required Sale is structured Notice (as defined below), to acquire a sale portion of the CSFB Shares to be Transferred in accordance with the procedures set forth in Section 5.3. Notwithstanding anything to the contrary contained herein, if after completion of the procedures set forth in Section 5.3, the Holders fail to elect to purchase all of the CSFB Shares, the Seller may exercise its right to effect a Required Sale. To exercise its right to effect a Required Sale, the Seller shall deliver a notice (the "Required Sale Notice") to each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of Holder setting forth: (i) the Series A Liquidation Amount date of such notice (as defined in the Memorandum and Articles) or "Notice Date"), (ii) the purchase price as stated in the offer name and address of the Drag-Along Purchaser pro rata based on Third Party, (iii) the proposed amount and type of consideration to be paid per share for the CSFB Shares, and a description in reasonable detail of the terms and conditions of payment offered by the Third Party, together with written proposals or agreements, if any, with respect thereto, (iv) confirmation that Seller is selling all of its Shares and that such Shares represent not less than 50% or more of the aggregate number of Ordinary Shares held by such Round C Investors Diluted Common Stock and (on an as-converted basisvi) the proposed date of the Required Sale (the "Required Sale Date"); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor which shall be not be liable to a Drag-Along Purchaser for an amount greater less than 60 nor more than 120 days after the proceeds from such saleNotice Date. (c) If The Co-Sellers shall cooperate in good faith with the DragSeller in order to consummate the Required Sale (including, without limitation, the giving of consents and the voting of Capital Stock held by the Co-Along Sellers to approve such Required Sale). On the Required Sale is structured as a mergerDate, amalgamation or scheme of arrangement each of the Company Seller and the Co-Sellers shall deliver, free and clear of all liens, claims or encumbrances (other transaction that requires than customary permitted liens), a certificate or certificates and/or other instrument or instruments for all of its Shares, duly endorsed and in proper form for transfer, with the approval signature guaranteed, to such Third Party in the manner and at the address indicated in the Required Sale Notice and Seller shall cause each Co-Seller's share of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Dragpurchase price to be paid to such Co-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along SaleSeller. (d) The DragEach of the Shareholders, on behalf of itself and its respective Permitted Transferees, expressly agrees that: (i) any and all consideration received in connection with any Required Sale shall be applied in the following order of priority: (A) first to the payment of all reasonable out-Along Seller shall provide written notice of-pocket fees and expenses incurred in connection with such sale (to the extent such fees and expenses are incurred for the benefit of all Holders and are not otherwise paid by the Corporation or the acquiring party; fees and expenses incurred by or on behalf of a proposed Drag-Along Sale Holder for its sole benefit will not be considered fees and expenses of the transaction hereunder), and once all such fees and expenses have been paid, then (B) second to the Other Investors (holders of shares of Preferred Stock, on a “Drag-Along Sale Notice”) not later than ten (10) days prior pro rata basis, and when all holders of shares of Preferred Stock have received an amount for each share of Preferred Stock equal to the Liquidation Amount, plus the accrued and unpaid dividends thereon through such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made date (the “Drag-Along Sale Price”"Minimum Purchase Amount"), then (C) third to the holders of shares of Common Stock and all other material terms and conditions of Common Stock Equivalents (with the Drag-Along Sale. Each Other Investor shall be required to participate Common Stock Equivalents receiving the amount specified by Section 5.5(e)(i), on a pro rata basis, and (ii) in the Drag-Along Sale on event the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of aggregate consideration payable in connection with a Required Sale consists of cash and property, the cash portion of such transfer consideration shall be applied first to the Drag-Along purchase of Preferred Stock until such time as each holder thereof shall have received the Minimum Purchase Amount whereupon the remaining cash and other property payable in connection with such Required Sale Priceshall be applied to the purchase of Common Stock and Common Stock Equivalents. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt obligations of the DragShareholders pursuant to this Section 5.5 are subject to the satisfaction of the following conditions: (i) all Shareholders holding then-Along currently exercisable Common Stock Equivalents will be given an opportunity to either (A) exercise such rights prior to the consummation of the Required Sale Notice (but only to the extent such share equivalents are then vested or will become vested as a result of the Required Sale) and participate in such transaction as stockholders, or (b) upon the consummation of the Required Sale, receive in exchange for such share equivalents consideration equal to the amount determined by multiplying (x) the same amount of consideration per share (of the same class as that for which the share equivalent is exercisable) received by holders of such class of share in connection with the Required Sale less the exercise price per share equivalent by (y) the number of share equivalents (but only to the extent such share equivalents are then vested); (ii) in the event that Shareholders are required to provide any representations or indemnities in connection with the Required Sale (other than representations and indemnities concerning each Shareholder's valid ownership of its shares, free of all liens and encumbrances (other than those that are released or satisfied at the closing of the Required Sale arising under applicable securities laws), and each Shareholder's authority, power, and right to enter into and consummate such Required Sale without violating any other agreement), then each Shareholder shall not be liable for more than its pro rata share (based upon the per share consideration received) of any liability for misrepresentation or indemnity and such liability shall not exceed the total purchase price received by such Shareholder for its Shares (including the exercise price of any Common Stock Equivalents). Any representations and warranties contemplated by this Section 5.5(e) may include any exceptions to the extent appropriate to make such representations and warranties true; (iii) the Required Sale may not be a definitive agreement providing transaction with an Affiliate of any Holder unless such Required Sale is approved by Holders holding a majority of the Voting Stock of the Corporation, measured by voting power rather than number of shares, held by non-Affiliates of that Holder; and (iv) no Shareholder shall, by such Shareholder's execution of this Agreement, by voting or consenting to any Required Sale or by taking any other action required under this Section 5.5 waive any claim (other than for the Drag-Along Sale on exercise of dissenter's rights) against the terms Corporation, any officer, director or stockholder thereof or any other Person and conditions set forth nothing herein is intended to relieve any Person of any duty it would owe to a Holder Shareholder in the absence of such Drag-Along Sale NoticeShareholder entering into this Agreement or taking any action required hereunder. All Shareholder agree that they will not take, which Drag-Along Sale shall be promptly consummatedand to the extent possible will cause their employees and Affiliates to not take, subject any position contrary to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply or inconsistent with the procedures that set forth in this Section 9.1(e5.5(e)(iv). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 1 contract

Samples: Securityholders Agreement (Pinnacle Gas Resources, Inc.)

Drag-Along Rights. (a) If, at any time prior to a Qualified IPO, any Investor If the Advent Holders (the “Drag-Along SellerDrag Sellers”) secures an irrevocable offer propose to acquire all share capital or assets effect a Transfer of Company Securities representing more than a majority of the outstanding Company Securities to any Person in a single transaction or in a series of related transactions (a “Drag-Along Sale”) with ), the Drag Sellers may at their option require each other Stockholder (the “Other Holders”), to Transfer a valuation portion of its Company Securities that represents the same percentage of the Company Securities held by such Other Holder as the number of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with Company Securities being sold by the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate Drag Sellers in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale bears to the total number of SharesCompany Securities held by the Drag Sellers. For example, if the Drag Sellers are selling Company Securities that represent 70% of the Company Securities held by such Drag Seller (determined on an as-converted or as-exercised basis), then each Other Investor Holder shall be required to sell to Company Securities that represent 70% of the Drag-Along Purchaser all Shares then Company Securities held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors Holder (on an as-converted or as-exercised basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (db) The Drag-Along Seller Drag Sellers shall provide written notice of a proposed such Drag-Along Sale to the Company and the Other Investors Holders (a “Drag-Along Sale Notice”) not later less than ten (10) days prior to such the consummation of the proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify (i) state the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is number and type of Company Securities proposed to be made Transferred to such Third Party, (ii) state the name of such Third Party and (iii) state the proposed amount (the “Drag-Along Sale Price”) and type of consideration to be paid by such Third Party for the Company Securities proposed to be Transferred and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 1 contract

Samples: Stockholders' Agreement (Bojangles', Inc.)

Drag-Along Rights. (a) IfWith respect to any proposed Transfer or related series of proposed Transfers (other than as provided in Section 3.3) of 50% or more of the issued and outstanding shares of Common Stock (measured as of the date of the notice required pursuant to Section 3.4(b) below) to an Independent Third Party by Investor and/or any of its Affiliates that are Stockholders (in such capacity, at any time prior to a Qualified IPO, any Investor (the “Drag-Along SellerTransferring Stockholders”), the Transferring Stockholders shall have the right to require each of the other Stockholders (in such capacity, a “Dragged Stockholder”) secures an irrevocable offer to acquire all share capital or assets of the Company sell (a “Drag-Along Sale”) with a valuation to the proposed transferee out of the Company total number of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed shares of Common Stock proposed to with be acquired in the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote the same proportion of the other Investors and a majority vote number of shares of Common Stock to be sold pursuant to the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1the total number of shares of Common Stock held on the date of sale by such Dragged Stockholder bears to the total number of shares of Common Stock of held on such date by the Transferring Stockholders and all Dragged Stockholders, and at the same price and upon the same terms and conditions for each share of Common Stock (including without limitation time of payment and form of consideration) as to be paid and given to the Transferring Stockholders. (b) If The Transferring Stockholders shall give notice to the other Stockholders of each proposed Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell at least thirty (30) days prior to the Drag-Along Purchaser all Shares then held by proposed consummation of such Other Investor on the same terms and conditions as are applicable to the Drag-Along Sellersale, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on setting forth the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect shares of Common Stock proposed to any liability incurred by such Other Investor individually, such Other Investor shall not be liable sold pursuant to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, the name and against any action or proposal that may prevent, hinder or impede the consummation address of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice proposed transferee, the proposed amount and form of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to consideration and other terms and conditions of such proposed Drag-Along Sale. The , and a representation that the proposed transferee has been informed of the drag-along rights provided for in this Section 3.4 and has agreed to purchase Common Stock in accordance with the terms hereof. (c) No Transfer shall occur pursuant to this Section 3.4 in a transaction in which less than all of the Common Stock held by the Stockholders is being sold unless the transferee shall agree to become a party to, and be bound to the same extent as its transferor by the terms of, this Agreement and the Transfer shall otherwise comply with the provisions of this Agreement. (d) If the proposed Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions not consummated within 90 days of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of Stockholders’ receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with notice of a Drag-Along Sale, each Other Investor the notice given pursuant to this Section 3.4 shall (i) make such representationsbe null and void, warranties and covenants it shall be necessary for a separate notice to be delivered, and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from terms and be subject to all of the same provisions of the definitive agreements as are applicable this Section 3.4 separately complied with, in order to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with consummate such Drag-Along Sale severallyTransfer; provided, furtherhowever, that no Other Investor shall such 90-day time period may be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share extended at the option of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or Transferring Stockholders for a reasonable period of time not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, to exceed an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), additional 90 days to the extent not paid that the failure to consummate the proposed Transfer is caused by the Company, and (v) a failure to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Saleobtain necessary government approvals.

Appears in 1 contract

Samples: Stockholders Agreement (Capmark Finance Inc.)

Drag-Along Rights. (a) If, If at any time prior to a Qualified IPOduring the Term, any Investor (the “Drag-Along Seller”) secures Clorox Partner enters into an irrevocable offer agreement to acquire consummate a transaction constituting a direct or indirect sale of all share capital or assets substantially all of the Company Glad Global Business (other than a Clorox Change of Control) (a “DragThird-Along Party Sale”) with ), then upon the written demand of Clorox, each P&G Partner will agree to sell all its JV Interests, and the P&G Option if the Third-Party Sale is during the Option Exercise Period and the P&G Option is not yet exercised, and at a valuation of price equal to the Company of more than US$600,000,000 with any Person (Fair Market Value for such PersonJV Interests, a “Drag-Along Purchaser”) and upon such the same other terms and conditions as agreed to be given to the Clorox Partners, provided that in order to be entitled to exercise their rights in connection with a Third Party Sale, the P&G Partners must agree to give the same indemnities as the Clorox Partners agree to make in connection with the Dragproposed sale, transfer or assignment, which obligations will be borne by the P&G Partners on a pro rata basis based on the relative Ordinary JV Interests of all JV Partners but in the case of each P&G Partner will in no event exceed ten percent (10%) of the sale proceeds received by such P&G Partner. Notwithstanding the foregoing, with respect to any a Third-Along SellerParty Sale that occurs prior to the three-year anniversary of the Closing Date, the purchase price to be paid to the P&G Partners in such Third-Party Sale for P&G’s initial Ordinary JV Interest of ten percent (10%) and Class C Interest will be an aggregate of no less than $140 million. With respect to the P&G Option if the P&G Option is unexercised but exercisable, the P&G Partners will receive from the proceeds otherwise payable to the Clorox Partners the amount by which the Fair Market Value of the Ordinary JV Interest and Class A Interest subject to the P&G Option exceeds the Option Price. The purchase price payable to the P&G Partners for the P&G Option (if the P&G Option is unexercised, but exercisable) will therefore be the greater of (i) zero and (ii) an amount equal to (x) the Fair Market Value of the Ordinary JV Interest and Class A Interest to be acquired by P&G upon exercise of the P&G Option minus (y) the then-applicable Option Price (and the amount of the purchase price payable to the Clorox Parties will be reduced by an equal amount). Upon completion of such Dragsale the P&G Option will terminate. Clorox agrees it will not enter into a Third-Along Party Sale, unless otherwise agreed by the P&G Partners, without obtaining an opinion from a nationally-recognized investment banking firm selected by Clorox, which investment banking firm is not otherwise entitled to any financial advisor’s or similar fee in connection with the Third-Party Sale, that the purchase price to be paid for the Glad Global Business in such Third-Party Sale is agreed by fair, from a majority vote financial point of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Sellerview, to participate in such Drag-Along Sale as set forth in this Section 9.1Clorox. (b) If Clorox may exercise its rights in connection with a Third-Party Sale at any time during the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell Term upon written notice to the Drag-Along Purchaser all Shares then held by such Other Investor on P&G Partners, setting forth the same name and address of the proposed transferee, the proposed amount of consideration therefor and terms and conditions as are applicable agreed to by the proposed transferee, provided that Clorox will use good faith efforts to give notice to the DragP&G Partners at least fifteen (15) days prior to the proposed consummation of any such Third-Along SellerParty Sale. Each P&G Partner will consent to and raise no objections to the proposed transaction and will take all other actions necessary or desirable to cause the consummation of such Third-Party Sale on the terms proposed by Clorox. If Clorox exercises its rights to cause a sale pursuant to this Section 6.7, including the same per-share consideration closing of the purchase will take place concurrently with respect to a specific class and as part of Sharesthe closing of the sale of the Glad Global Business, and shall execute the necessary transfer forms in favor Term of the Drag-Along Purchaser; provided that Joint Venture will terminate as of such closing. If the proceeds proposed transferee fails to complete its purchase from such sale any P&G Partner at the closing of any Round C Investors shall Third-Party Sale, then Clorox will not be less than permitted to make the higher proposed Third-Party Sale, and any such attempted sale, transfer or assignment will be void and of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such saleno effect. (c) If Clorox further agrees that in the Drag-Along Sale is structured as event that it determines to solicit offers for a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Third Party Sale, it will notify the P&G Partners and against any action or proposal that may prevent, hinder or impede if the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than P&G Partners notifies Clorox in writing within ten (10) days prior of receipt of such notice that P&G has made a good faith determination to pursue a purchase of the Glad Global Business, Clorox and P&G will negotiate exclusively for a period not to exceed forty-five (45) days with respect to a potential purchase by P&G of the Glad Global Business on terms satisfactory to each of Clorox and P&G, provided that the provisions of this Section 6.7(c) will in no way obligate Clorox to notify or negotiate with P&G in the event Clorox receives a binding, unsolicited offer for a Third Party Sale, and provided further that it is understood that in the event P&G and Clorox do not enter into a binding agreement with respect to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material purchase on terms and conditions of satisfactory to each Party in its sole discretion within such forty-five day period, Clorox will have the Drag-Along Sale. Each Other Investor shall be required right thereafter to participate in the Drag-Along Sale on the terms solicit offers and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Third Party Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SalePerson.

Appears in 1 contract

Samples: Joint Venture Agreement (Clorox Co /De/)

Drag-Along Rights. (a) IfSo long as VSI holds at least 66 2/3% of the then-outstanding Common Stock, if at any time prior VSI proposes to sell, in any transaction or a Qualified IPOseries of related transactions, any Investor shares of Common Stock constituting at least 50% of the Common Stock held by VSI, VSI shall have the right (the “a "Drag-Along Seller”Right") secures an irrevocable offer to acquire all share capital require each Investor to sell, or assets cause to be sold, such number of shares of Class A Common Stock which represents the same percentage of the Company Class A Common Stock held by such Investor as the number of shares of Common Stock being sold by VSI in such sale transaction(s) (a "Drag-Along Sale”Transaction") with represents as a valuation percentage of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then Common Stock held by such Other Investor VSI, for the same price and form of consideration per share and otherwise on the same terms and conditions as are applicable to VSI. (b) If VSI desires to exercise a Drag-Along Right pursuant to Section 2.5(a), it must give written notice to each Investor of the proposed Drag-Along Transaction giving rise to the Drag-Along Seller, Right at least 30 days prior to the consummation thereof (a "Drag-Along Notice"). The Drag-Along Notice shall set forth the principal terms of such proposed transaction including the per share price to be paid and the name and address of the prospective buyer. If VSI consummates the proposed transaction to which reference is made in the Drag-Along Notice, each Investor shall be bound and obligated to sell the number of shares of his Class A Common Stock specified in Section 2.5(a) in the proposed transaction for the same per-price and form of consideration per share consideration and otherwise on the same terms and conditions with respect to each share sold by VSI. In such event, no later than immediately prior to the consummation of the proposed transaction, each Investor shall cause the conversion into Class A Common Stock of that number of shares of its Series A Preferred Stock that will result in the issuance by the Corporation to such Investor of at least a specific class number of Sharesshares of Class A Common Stock equal to the number of shares of Class A Common Stock being sold by such Investor pursuant to this Section 2.5. If, and shall execute at the necessary transfer forms in favor end of the 90th day following the date of the Drag-Along Purchaser; provided that Notice, VSI has not completed the proceeds proposed transaction, each Investor shall be released from his obligation under the Drag-Along Notice, the Drag-Along Notice shall be null and void, and it shall be necessary for a new Drag-Along Notice to be furnished, and the terms and provisions of this Section 2.5 again complied with, in order to consummate such proposed transaction pursuant to this Section 2.5. (c) Each Investor agrees to vote his Series A Preferred Stock (or Class A Common Stock issued upon conversion thereof), and hereby grants to the Corporation an irrevocable proxy to vote such Series A Preferred Stock and Class A Common Stock, in the same proportion as shares are voted by VSI in connection with any Drag-Along Transaction or any merger, consolidation, reorganization or sale of assets which would have a similar effect to that of a Drag-Along Transaction. The Corporation agrees not to give effect to any Round C Investors action by any Investor or any other Person which is in contravention of this Section 2.5(c). The foregoing provisions shall expire on the last date permitted by law. (d) Notwithstanding the foregoing, VSI shall have no Drag-Along Rights pursuant to the provisions of this Section 2.5 with respect to any transfer: (i) to an Affiliate of VSI; (ii) to any employee, officer or director of the Corporation who is not be an Investor at the time of such transfer; (iii) in a Public Offering or to the public under Rule 144 under the Securities Act; or (iv) in which the per-share consideration for the Common Stock being sold is less than the higher dollar value of the portion of the liquidation preference of one share of Series A Preferred Stock (i) as determined in accordance with the Certificate of Designation for the Series A Liquidation Amount (Preferred Stock) represented by one share of Class A Common Stock calculated based on the Conversion Price and as defined in of the Memorandum and Articles) or (ii) the purchase price as stated in the offer date of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such saleNotice. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 1 contract

Samples: Stockholders Agreement (Vitaminshoppecom Inc)

Drag-Along Rights. (a) If, at any time prior to The SLP Investors may give written notice (a Qualified IPO, any Investor (the “Drag-Along SellerNotice”) secures an irrevocable offer to acquire all share capital the Senior Managers that the SLP Investors intend to enter into a transaction or assets a series of related transactions involving the transfer, of not less than fifty percent (50%) of the Company outstanding Share Equivalents (which Share Equivalents to be transferred may include Share Equivalents held by the Senior Managers and/or other holders of Share Equivalents) to a Person or “group” of Persons (other than to the SLP Investors or an Affiliate of the SLP Investors), whether by merger, tender offer or otherwise (a “Drag-Along Sale”) with a valuation of ), and, that the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed SLP Investors desire to with cause the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, Senior Managers to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor transaction on the same terms and conditions as are applicable available to the Drag-Along SellerSLP Investors; provided, including however, that no Senior Manager shall be required to assume any liability or provide indemnification in connection with such transaction other than (i) liability or indemnification that relates to the same per-share consideration ownership of, and the ability to transfer, the Share Equivalents being transferred by it and (ii) with respect to a specific class of Sharesall other liabilities or indemnification in connection with such transaction, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser its pro rata share on the same terms and conditions as the SLP Investors (based on the number of Ordinary Shares held Share Equivalents being transferred by each Senior Manager in such Round C Investors (on an as-converted basistransaction); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a . Such Drag-Along Purchaser for an amount greater than Notice shall also specify (1) the proceeds from such sale. (c) If the Drag-Along Sale is structured as a mergerconsideration, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investorsif any, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary to be received by the Drag-Along Seller in connection with SLP Investors and the Drag-Along Sale, Senior Managers and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the proposed transaction (which price and other material terms and conditions shall be the same in all material respects for the SLP Investors and the Senior Managers), (2) the identity of the other Person or Persons party to the transaction, (3) the date of completion of the proposed transaction (which date shall be not less than ten (10) Business Days after the date of the notice) and (4) the action or actions required of each Senior Manager in order to complete or facilitate such proposed transaction (including the sale of Share Equivalents held by the Senior Manager, the voting of all such Share Equivalents in favor of any such merger, consolidation or sale of assets and the waiver of any related appraisal or dissenters’ rights). If the SLP Investors are transferring less than all of the Share Equivalents held by the SLP Investors, then each Senior Manager will transfer a number of Share Equivalents equal to the product of the following (the “Drag-Along SalePortion”): (x) the number of Share Equivalents (including any Shares issuable upon the exercise of Options to the extent such Options are then vested and exercisable) beneficially owned by such Senior Manager multiplied by (y) a fraction, the numerator of which is the aggregate number of Share Equivalents being transferred by the SLP Investors and the denominator of which equals the aggregate number of Share Equivalents beneficially owned by the SLP Investors. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of Upon receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale each Senior Manager shall be promptly consummatedobligated to take the action or actions referred to in clause (4) above; provided that, subject in the case of a sale of Shares, with respect to fulfilling any closing conditions Shares for which a Senior Manager holds vested and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day periodexercisable but unexercised Options, the Drag-Along Seller price per Share shall again comply be reduced by the exercise price of such Options or, if required pursuant to the terms of such Options, such Stockholder shall pay the exercise price therefor prior to the consummation of such sale and shall transfer such Shares to the purchaser in such sale (in each case, net of any amounts required to be withheld by the Company in connection with the procedures set forth in this Section 9.1(esuch Option exercise). (fb) In connection with a Drag-Along Sale, each Other Investor This Section 3.5 shall (i) make such representations, warranties and covenants and enter into such definitive agreements terminate as are customary for transactions to Senior Managers on the expiration of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleTransfer Restriction Period.

Appears in 1 contract

Samples: Management Stockholders Agreement (IPC Systems Holdings Corp.)

Drag-Along Rights. If any shareholder or group of shareholders holding in the aggregate more than 50% of the then outstanding shares of New Common Stock (a) Ifcollectively, at any time prior to a Qualified IPO, any Investor (the “Drag-Along Holder”) proposes to transfer at least 75% of their then-outstanding shares of New Common Stock (other than to an Affiliate or in connection with an IPO), or to otherwise effect a sale of the Company, whether through merger, consolidation, share exchange, business combination, sale or disposition of assets, or otherwise, in each case to an unaffiliated third party purchaser or acquirer, such Drag-Along Holder may require each other shareholder (a “Dragged Seller”) secures an irrevocable offer to acquire all share capital or assets of the Company participate in such transaction (a “Drag-Along Sale”) with on a valuation pro rata basis (except that, at the election of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Holder, a Dragged Seller may be required to include all of its equity in such Drag-Along Sale if such Dragged Seller, together with its affiliates, holds less than 1% of the Company’s then-outstanding common equity or, if such Dragged Seller is an employee of the Company or any of its subsidiaries, rollover in customary amounts) if, and only if, (x) the Drag Threshold (as defined below) has been met and (y) at least 75% of the consideration for the Drag-Along Sale is paid in cash and/or publicly traded securities; provided, however, that such drag-along rights shall expire upon the effectiveness of an initial public offering of the Company. In connection with such Drag-Along Sale, each shareholder will (i) consent to, vote in favor of, raise no objection to and waive and refrain from exercising any appraisal or dissenter’s rights claim or any claim of fiduciary breach (but not any claim that such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate not being effected in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection accordance with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-New Corporate Governance Documents) and (ii) obtain any required consents and take any and all reasonably necessary action in furtherance of the Drag Along Sale Notice at the Company’s expense and subject to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the other customary terms and conditions set forth (including, but not limited to, limitation of liability in such Dragexcess of consideration received, pro rata indemnification and no non-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject compete restrictions) reasonably acceptable to fulfilling any closing conditions and obtaining any required regulatory approvalsthe Required Consenting Unsecured Creditors. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions Management of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) Company shall not be required to bear its proportionate share of agree to any escrowsnon-compete, holdbacks non-solicit or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled similar restrictive covenants in connection with a Drag-Along SaleSale that are more restrictive in any manner than those (in scope, duration or otherwise) to which management is then subject. “Drag Threshold” shall mean the approval of at least (i)(a) 66- 2⁄3% (5 of 7) Directors and (b) 55% of the then-outstanding shares of New Common Stock or (ii) 85% (6 of 7) Directors.

Appears in 1 contract

Samples: Chapter 11 Plan Support Agreement (Intelsat S.A.)

Drag-Along Rights. (a) If, If at any time prior to a Qualified IPO, any Investor (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer holders of Preferred Stock holding at least a majority of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (then outstanding Preferred Stock, acting as a single class and on an as-converted basisbasis (the “Initiating Preferred Purchasers”); provided, furtherand (ii) holders of Exchange Common Stock (as hereinafter defined) and Special Voting Stock holding at least fifteen percent (15%) (as determined by the aggregate number of votes held directly and through the Voting Trustee in accordance with the Voting Trust Agreement) of the then outstanding Exchange Common Stock and Special Voting Stock, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured acting as a mergersingle class (the “Initiating Common Purchasers,” and together with the Initiating Preferred Purchasers, amalgamation the “Initiating Purchasers”) propose to effect (or scheme of arrangement of to cause the Company to effect) a Sale Event (as defined below) and the Board of Directors approves of or other transaction that requires consents to such Sale Event, the approval of the Investors, each Investor shall vote its respective Shares (or execute and Initiating Purchasers may deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written a notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Event Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions other Security Holders stating that the Initiating Purchasers propose to effect (or to cause the Company to effect) such transaction (the “Sale Event Notice Transaction”), and specifying the name and address of the definitive agreements as are applicable proposed parties to such transaction and the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person consideration payable in connection with such Drag-Along therewith. Upon receipt of a Sale severally; providedEvent Notice other than an Asset Sale Transaction, further, that no Other Investor each Security Holder shall be obligated to indemnify any other shareholder for any breach or misrepresentation Transfer all Shares in the Company owned by such other shareholder with respect to title it in such other shareholder’s equity securitiesthe Sale Event (or, (iv) be required to bear its proportionate share in the case of a Sale Event involving a sale of less than all of the costs and expenses incurred by the Company and the Investors outstanding Shares in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to a percentage of the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled Shares in connection with a Drag-Along Sale.the

Appears in 1 contract

Samples: Stockholders Agreement (Eloqua, Inc.)

Drag-Along Rights. (a) IfIf both of the Lead Stockholders propose a transfer in connection with a sale or exchange, at any time prior whether directly or pursuant to a Qualified IPOmerger, any Investor (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital consolidation or assets of the Company otherwise (a "Drag-Along Sale”) with a valuation of "), the Company of more than US$600,000,000 with any Person Lead Stockholders may require all other Stockholders to sell all Shares proposed to be sold therein (such Person, a “"Drag-Along Purchaser”Rights") upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor every Stock holder, for the same consideration and otherwise on the same terms and conditions (including timing of receipt of consideration) as are applicable the sale by Lead Stockholders; provided, however, that if ----------------- either of the Lead Stockholders and its respective Affiliates cease to collectively beneficially own at least 20% of the shares of Common Stock (including shares of Common Stock issuable upon conversion of securities convertible, exchange able or exercisable for shares of Common Stock) beneficially owned by them immedi ately following the closing of the transactions contemplated by the Securities Purchase Agreement, Stockholders collectively holding more than 50% of the voting power represented by the outstanding Shares and shares of Class B Common Stock (the "Majority Stockholders") shall have the ability to exercise the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms Rights described in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such salethis Section 4.2. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (db) The Drag-Along Seller Lead Stockholders or the Majority Stockholders, as applicable, shall provide written notice of a proposed such Drag-Along Sale to the Other Investors other Stockholders (a "Drag-Along Sale Notice") not later than ten (10) days the 15/th/ day prior to such the proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchasertransferee, the per-Ordinary Share number of Shares and/or shares of Class B Common Stock to be transferred, the consideration for which a transfer is proposed to be made (the "Drag-Along Sale Price”Price(s)") and all other material terms and conditions of the Drag-Along Sale. Each Other Investor Subject to Section 4.2(d), each Stockholder shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender all its SharesShares and shares of Class B Common Stock as set forth below. The price and form of consideration price(s) payable in such transfer shall be the Drag-Along Sale PricePrice(s). Not later than the 10/th/ day following the date of the Drag-Along Notice (the "Drag-Along Notice Period"), each of the Stockholders shall deliver to a representative of Lead Stockholders or the Majority Stockholders, as applicable, designated in the Drag-Along Notice certificates representing all the Shares and shares of Class B Common Stock beneficially owned and held by such Stockholder, duly endorsed, together with all other documents required to be executed in connection with such Drag-Along Sale, or if such delivery is not permitted by applicable law, an unconditional agreement to deliver such shares pursuant to this Section 4.2 at the closing for such Drag-Along Sale against delivery to such Stockholder of the consideration therefor. (ec) The Drag-Along Seller Lead Stockholders or the Majority Stockholders, as applicable, shall have a period of 180 90 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for consummate the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has Sale shall not entered into a definitive agreement providing for the Drag-Along Sale within have been consummated during such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller Lead Stockholders or the Majority Stockholders, as applicable, shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, return to each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature Stockholders all certificates or other evidence of title and ownership representing shares that such Stockholders delivered for transfer pursuant hereto, together with any docu ments in the possession of the Drag-Along SaleLead Stockholders or the Majority Stockholders, (ii) benefit from and be subject to all of as applicable, executed by the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person Stockholders in connection with such Drag-Along Sale severally; providedproposed transfer, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach and all the restrictions on transfer contained in this Agreement or misrepresentation by otherwise applicable at such other shareholder time with respect to shares owned by the Stockholders shall again be in effect. (d) Concurrently with the consummation of the transfer of shares pursuant to this Section 4.2, the Lead Stockholders or the Majority Stockholders, as applicable, shall give notice thereof to all Stockholders, shall remit to each of the Stockholders who have surrendered their certificates or other evidence of title in and ownership the total consider ation (by bank or certified check) for the shares transferred pursuant hereto and shall furnish such other shareholder’s equity securities, (iv) be required to bear its proportionate share evidence of the costs completion and expenses incurred by the Company time of completion of such transfer and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if terms thereof as may be reasonably requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Salesuch Stockholders.

Appears in 1 contract

Samples: Stockholders' Agreement (Guayacan Private Equity Fund Lp)

Drag-Along Rights. If one or more Founders wish to Transfer Covered Securities, constituting in the aggregate more than 50% of the outstanding Covered Securities (a) Ifand at least 50% of the outstanding Covered Securities held by the Founders and their Affiliates), at any time prior the Outside Equityholders hereby agree to a Qualified IPOTransfer all, any Investor but not less than all, the Covered Securities then owned by them in such Transfer (the “Drag-Along Seller”Sale”)as follows; provided that (x) secures an irrevocable offer to acquire all share capital or assets the terms of the Company Drag-Along Sale shall entitle each of the Outside Equityholders to effect the Transfer of their Covered Securities in the Drag-Along Sale pursuant to, at such Outside Equityholder’s option, either of the methods set forth in Section 4(c), (a y) all of the consideration for the Drag-Along Sale shall be payable in cash or marketable securities, and (z) the fair market value of the per share price paid in connection with the Drag-Along Sale shall be at least equal to the Fair Market Value of the Covered Securities. (a) The Founders shall give written notice (the “Drag-Along SaleNotice”) with a valuation to the Outside Equityholders at least 45 days prior to any proposed Drag-Along Sale, and such notice shall specify the number of Covered Securities which they desire to Transfer, the percentage of the Company total number of more than US$600,000,000 with any Person Covered Securities then held by them represented by the number of Covered Securities they propose to Transfer, the identity of the proposed purchaser of such Covered Securities (such Person, a the “Drag-Along Purchaser”) upon such terms and conditions as agreed to with ), the aggregate number of Covered Securities the Drag-Along SellerPurchaser is willing to purchase, and the time within which and the price and all other material terms and conditions upon which the Founders propose to Transfer such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1Covered Securities. (b) If the Drag-Along Sale is structured as a sale The Outside Equityholders shall deliver duly executed contractual documents of Shares, each Other Investor transfer and shall sell Transfer all their Covered Securities to the Drag-Along Purchaser on the closing of the Drag-Along Sale, provided that all Shares then held Covered Securities Transferred by such Other Investor the Outside Equityholders are Transferred to the Drag-Along Purchaser at the closing of the Drag-Along Sale at the same price (which price shall be determined on an as-converted basis for all Covered Securities (and shall be expressed on a Common Stock Equivalent basis)) and on the same terms and conditions (except as are applicable set forth in Section 4(d) and with respect to representations and warranties made by the Founders). (c) In the event of a Drag-Along SellerSale, including then, at each Outside Equityholder’s election, such Outside Equityholder shall be entitled to either (x) exercise, convert or exchange such Outside Equityholder’s Covered Securities for Common Stock concurrently with such Transfer and have Section 4(c)(i) below apply thereto or (y) cause all of such Outside Equityholder’s Covered Securities to be converted into the same per-share right to receive the consideration with respect as provided in Section 4(c)(ii) below. (i) If such Outside Equityholder so elects, such Outside Equityholder shall have the right to a specific class of Sharesexercise, convert or exchange its Covered Securities for Common Stock concurrently with, and shall execute subject to, the necessary transfer forms in favor consummation of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined Sale and thereafter participate in the Memorandum and Articles) or Drag-Along Sale as a holder of Common Stock; or (ii) If such Outside Equityholder so elects, such Outside Equityholder shall have the purchase price as stated in right, upon the offer consummation of the Drag-Along Purchaser pro rata based Sale, to receive in exchange for such Outside Equityholder’s Covered Securities consideration equal to the product of: (A) the amount of consideration on a per share basis received by the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement holders of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller Common Stock in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede (B) the number of Common Stock Equivalents represented by such Outside Equityholder’s Covered Securities immediately prior to the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor Outside Equityholders shall be obligated to indemnify any other shareholder for any breach or misrepresentation make all the representations, warranties, covenants and agreements made by such other shareholder with respect the Founders (including indemnity) but only as to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share their ownership of the costs Covered Securities, transfer of title to such Covered Securities, the power and expenses incurred by authority to effectuate the Company Transfers, and the Investors in connection with enforceability of their respective obligations under the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleTransfer documentation.

Appears in 1 contract

Samples: Note and Warrant Purchase Agreement (Numbeer, Inc.)

Drag-Along Rights. (a) If, If at any time prior to a Qualified IPOan Initial Public ----------------- Equity Offering, any Investor (the “Drag-Along Seller”) secures an irrevocable offer Investors and their respective Affiliates determine to acquire sell all share capital or assets of the Capital Stock of the Company owned by them to a Person other than an Investor or an Affiliate of an Investor in a transaction resulting in a Warrant Change of Control, the transferring Investors (a “Drag-Along Sale”whether directly or through an Affiliate) with a valuation shall have the right to require the Holders of Subject Equity to sell such Subject Equity to such transferee; provided that (a) the Company consideration to -------- be received by the Holders of more than US$600,000,000 with Subject Equity shall be the same type of consideration received by the Investors and their Affiliates and, in any Person (such Personevent, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Sellershall be cash or freely transferable marketable securities, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If after giving effect to such transaction, the Drag-Along Sale is structured as a sale Investors and their Affiliates shall not own, directly or indirectly, any Capital Stock or rights to purchase Capital Stock of Shares, each Other Investor the Company. Any Warrants and/or Registrable Securities purchased from the Holders thereof pursuant to this Section 3.3 shall sell to be paid for at the Drag-Along Purchaser all Shares then held by such Other Investor on same price per share of Common Stock and upon the same terms and conditions as are applicable of such proposed transfer of Common Stock by the Investors and their Affiliates. Notwithstanding the foregoing, shares of Convertible Preferred Stock being transferred by an Investor or its Affiliates shall be entitled to receive the Drag-Along SellerFair Market Value of consideration, including the same per-share consideration with respect up to a specific class of Shares, and shall execute the necessary transfer forms but not in favor excess of the Drag-Along Purchaser; provided aggregate liquidation preference of, plus accrued and unpaid dividends on, such shares of Convertible Preferred Stock prior to any payment of consideration in respect of that Subject Equity which the holder thereof is obligated to sell. In the event that the proceeds from such sale Fair Market Value of consideration that is paid in respect of any Round C Investors shall not be less than the higher shares of (i) the Series A Liquidation Amount (as defined Convertible Preferred Stock being transferred by an Investor or its Affiliates is in the Memorandum excess of its aggregate liquidation preference plus accrued and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individuallyunpaid dividends, such Other Investor shares of Convertible Preferred Stock shall not be liable deemed for all purposes of this provision to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days have been converted into Common Stock immediately prior to such proposed Drag-Along Saletransfer. The Drag-Along Sale Notice shall identify If the Drag-Along PurchaserSubject Equity to be purchased includes securities other than Common Stock, the per-Ordinary Share consideration for which a transfer is proposed price to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in paid for such transfer securities shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate price per share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not denomination paid by the Companyproposed purchaser for like securities purchased from the Investors and their Affiliates or, if like securities are not purchased from the Investors and (v) to their Affiliates, the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleFair Market Value of such securities.

Appears in 1 contract

Samples: Common Stock Registration Rights Agreement (Equinix Inc)

Drag-Along Rights. If (i) 80% of the members of the Board then in office, including the Preferred Directors (ii) a majority-in-interest of the common stock and (iii) a majority-in-interest of the Investors approve a Change of Control Transaction (as defined below) (the “Selling Investors”), then each Voting Party agrees as follows: (a) Ifif such transaction requires stockholder approval, at with respect to all Shares that such Voting Party owns or over which such Voting Party otherwise exercises voting power, to vote (in person, by proxy or by action by written consent, as applicable) all Shares in favor of, and adopt, such Change of Control Transaction (together with any time prior related amendment to a Qualified IPO, the Company’s certificate of incorporation required in order to implement such Change of Control Transaction) and to vote in opposition to any Investor (and all other proposals that could reasonably be expected to delay or impair the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets ability of the Company (a “Drag-Along Sale”) with a valuation to consummate such Change of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1.Control Transaction; (b) If if such transaction is a Stock Sale, to sell the Drag-Along Sale is structured as a sale same proportion of Shares, each Other Investor shall sell to shares of capital stock of the Drag-Along Purchaser all Shares then Company beneficially held by such Other Investor Voting Party as is being sold by the Selling Investors to the party to whom the Selling Investors propose to sell their Shares, and, except as permitted in Section 3.2 below, on the same terms and conditions as are applicable the Selling Investors; (c) to execute and deliver all related documentation and take such other action in support of the Drag-Along SellerChange of Control Transaction as shall reasonably be requested by the Company or the Selling Investors in order to carry out the terms and provision of this Section 3, including 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 not to deposit, except as provided in this Agreement, any Shares of the same per-share consideration Company owned by such party or affiliate in a voting trust or subject any Shares to any arrangement or agreement with respect to a specific class the voting of such Shares, unless specifically requested to do so by the acquiror in connection with the Change of Control Transaction; (e) to refrain from exercising any dissenters’ rights or rights of appraisal under applicable law at any time with respect to such Change of Control Transaction; (f) if the consideration to be paid in exchange for the Shares pursuant to this Subsection 3.1 includes any securities and shall execute due receipt thereof by any Voting Party would require under applicable law (x) the necessary transfer forms registration or qualification of such securities or of any person as a broker or dealer or agent with respect to such securities; or (y) the provision to any Voting Party of any information other than such information as a prudent issuer would generally furnish in favor an offering made solely to “accredited investors” as defined in Regulation D promulgated under the Securities Act of 1933, as amended, the Company may cause to be paid to any such Voting Party in lieu thereof, against surrender of the Drag-Along PurchaserShares which would have otherwise been sold by such Voting Party, an amount in cash equal to the fair value (as determined in good faith by the Company) of the securities which such Voting Party would otherwise receive as of the date of the issuance of such securities in exchange for the Shares; provided and (g) in the event that the proceeds from Selling Investors, in connection with such sale Change of any Round C Investors shall not be less than Control Transaction, appoint a stockholder representative (the higher “Stockholder Representative”) with respect to matters affecting the Voting Parties under the applicable definitive transaction agreements following consummation of such Change of Control Transaction, (x) to consent to (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or appointment of such Stockholder Representative, (ii) the purchase price establishment of any applicable escrow, expense or similar fund in connection with any indemnification or similar obligations, and (iii) the payment of such Stockholder’s pro rata portion (from the applicable escrow or expense fund or otherwise) of any and all reasonable fees and expenses to such Stockholder Representative in connection with such Stockholder Representative’s services and duties in connection with such Change of Control Transaction and its related service as stated in the offer representative of the Drag-Along Purchaser pro rata based on stockholders, and (y) not to assert any claim or commence any suit against the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except Stockholder Representative or any other Stockholder with respect to any liability incurred by such Other Investor individually, such Other Investor shall not action or inaction taken or failed to be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary taken by the Drag-Along Seller Stockholder Representative in connection with its service as the Drag-Along SaleStockholder Representative, and against any action absent fraud, bad faith or proposal that may prevent, hinder or impede the consummation of the Drag-Along Salewillful misconduct. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 1 contract

Samples: Voting Agreement (Eyenovia, Inc.)

Drag-Along Rights. Notwithstanding anything herein to the contrary, but subject to Sections 5.2(a) and 5.6, (ai) If, at any time prior after the third (3rd) anniversary of the date hereof, if the holders of at least a majority of Common Shares held by the Founder Holdcos and the holders of at least 75% of Series E Shares, approve a Transfer of all Shares held by them or approve a proposed Trade Sale, in each case to a Qualified IPObona fide third party purchaser and based on a total equity value of the Company of no less than US$1,300,000,000, or (ii) ninety-seven (97%) or more of all voting power of the Company, voting together as a single class on an as-converted basis, approve a Transfer of all Shares held by them to a purchaser, or approve a proposed Trade Sale without any Investor requirement in terms of a total consideration, then, in any such event, upon written notice from such Drag-Along Shareholders (as defined below) requesting them to do so, each of the other shareholders of the Company (the “Dragged Shareholders”) shall (i) vote, or give its written consent with respect to, all Shares held by them in favor of such proposed Drag-Along Sale and in opposition of any proposal that could reasonably be expected to delay or impair the consummation of any such proposed Drag-Along Sale; (ii) transfer all of their Shares in such Drag-Along Sale to such purchaser; (iii) refrain from exercising any dissenters’ rights (including without limitation those set forth in Section 8) or rights of appraisal under applicable law at any time with respect to or in connection with such proposed Drag-Along Sale; and (iv) take all actions reasonably necessary to consummate the proposed Drag-Along Sale, including without limitation amending the then existing Restated Articles. All proceeds derived from a Dragged-Along Sale shall be distributed among the holders of Preferred Shares and holders of Common Shares in accordance with the Restated Articles. Notwithstanding any provision to the contrary, the share transfer restrictions of Section 4 of this Agreement shall not apply to any transfers made pursuant to this Section 5, provided that there shall be no Drag-Along Sale in the event that the Preferred Holders other than the Drag-Along Shareholders (the “Minority”) shall agree to purchase all Shares proposed to be sold by the Drag-Along Shareholders on the same terms as the proposed Drag-Along Sale within 10 Business Days after receipt by the Minority of the Drag Along Notice (as defined below) (the “Minority Purchase Right”), in which case all proceeds derived from such sale shall be distributed among the holders of Preferred Shares (other than the Minority exercising the Minority Purchase Right) and holders of Common Shares in accordance with the Restated Articles. The Minority Purchase Right shall be exercised by the Minority in the manner set forth in Sections 5.6 and 5.7 below. For the purpose of this Section 5, as required by the context, (i) the shareholders who have the right to approve a Transfer of Shares or a proposed Trade Sale as set forth above are collectively referred to as the “Drag-Along Seller”) secures an irrevocable offer to acquire Shareholders” and such Transfer of all share capital Shares or assets of the Company (a proposed Trade Sale each is referred as a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms ; and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated purchaser in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall not be promptly consummateddeemed a bona fide third party purchaser if (x) the Series E Investor, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If individually or in the Drag-Along Seller has not entered into a definitive agreement providing for aggregate, directly or indirectly owns or controls the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions voting of more than 30% of the nature total outstanding equity interest in such purchaser, (y) such purchaser directly or indirectly owns or controls the voting of more than 30% of the Drag-Along Saletotal outstanding equity interest in any Series E Holder, or (iiz) benefit from and be subject to all there exists a Person that directly or indirectly owns or controls the voting of more than 30% of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of total equity interest in both such purchaser and any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleSeries E Holder.

Appears in 1 contract

Samples: Shareholder Agreement (Xunlei LTD)

Drag-Along Rights. (a) IfBeginning four years after the date hereof, at any time prior if the Board approves a Strategic Transaction, then, subject to a Qualified IPOsubsection (c) below, any Investor each Stockholder shall sell all (or such lesser amount as may be required pursuant to such Strategic Transaction) Securities held by him, her or it pursuant to such Strategic Transaction, and in accordance with the terms and provisions, and in the manner, approved by the Board for such Strategic Transaction (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets of the Company (a “Drag-"Drag- Along Sale”) with a valuation "). All sellers of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate Securities in such Drag-Along Sale shall (i) receive the same consideration per share of Common Stock (without regard to class) and of each class of any other Securities, shall be subject to the same terms and conditions of sale and shall otherwise be treated equally or, where appropriate, pro rata based upon the number of shares of Securities held by each Stockholder; (ii) receive consideration (A) at least 50% of which shall consist of cash and/or marketable securities listed for trading on the New York Stock Exchange, the American Stock Exchange, or the National Market System of the Nasdaq Stock Market and (B) equal to or exceeding the Fair Market Value of the Securities being sold in such Strategic Transaction; and (iii) execute such reasonable and customary documents and take such actions as set forth may be reasonably required by the Board for the purposes of consummating such Strategic Transaction in accordance with this Section 9.13.7. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell Subject to the Drag-Along Purchaser all Shares then held provisions of Subsection (a) above, any such sale by such Other Investor any Stockholder shall be on the same terms and conditions as are applicable to the proposed Drag-Along SellerSale by each other Stockholder; provided, including however, that all selling Stockholders shall share pro rata, based upon the same per-share consideration with respect number of shares of Common Stock (without regard to a specific class), the number of shares of each class of Shares, and shall execute Security (other than Common Stock) or the necessary transfer forms in favor principal amount of the Drag-Along Purchaser; provided that Subordinated Notes, as the proceeds from such sale of any Round C Investors shall not be less than the higher of case may be, being sold by each, (i) in any reasonable or customary indemnity liabilities to the Series A Liquidation Amount (as defined purchaser in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured (other than representations as a merger, amalgamation or scheme to encumbered ownership of arrangement of and ability to transfer the Company or shares being sold by any other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents seller in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, any other matter relating solely to another seller, which shall be the sole responsibility of such other seller, or any representations relating to the Company or its Subsidiaries, their financial condition, assets or results of operations) and against (ii) in any action reasonable or proposal customary escrow (not to exceed 20% of the purchase price in the Drag-Along Sale) for the purpose of satisfying any such indemnity liabilities; provided further, however, that may preventeach Stockholder's sharing obligation hereunder with respect to such indemnity or other liabilities shall be limited to the lesser of(A) the Securities being sold by such Stockholder and the proceeds thereof, hinder including (without limitation) the cash and non-cash consideration received by such Stockholder with respect to such Securities and (B) a pro rata portion of such indemnity or impede other liability based upon the amount of proceeds received by such Stockholder in the Drag-Along Sale. In no circumstance whatsoever hereunder or under any provision of any agreement relating to the Strategic Transaction or otherwise shall any recourse be had to such Stockholder, whether by levy or execution, or under any law, or by the enforcement of any assessment or penalty or otherwise, it being understood that the sole recourse for enforcing such Stockholder's obligation shall be to such Securities being sold thereby and the proceeds thereof. (c) The Company shall provide each Stockholder with written notice (the "Sale Notice") not more than 60 nor less than 30 days prior to the date of the consummation of the Drag-Along Sale. Sale (d) The Drag-Along Seller shall provide written notice of a proposed the "Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along SaleDate"). The Drag-Along Each Sale Notice shall identify set forth: (i) the Drag-Along Purchaser, name and the per-Ordinary Share consideration for which a transfer is address of each proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions transferee or purchaser of Securities in the Drag-Along Sale. Each Other Investor shall ; (ii) the proposed amount and form of consideration to be required paid for such Securities and the terms and conditions of payment offered by each proposed transferee or purchaser, (iii) confirmation that the proposed purchaser or transferee has been informed of the "Drag-Along Rights" provided for herein and has agreed to participate purchase Securities in accordance with the terms hereof; and (iv) the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale PriceDate. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 1 contract

Samples: Stockholders Agreement (Resources Connection Inc)

Drag-Along Rights. (a) If, If at any time prior to the IPO Date, the Board of Directors of the Company and the holders of a Qualified IPOmajority of the capital shares of the Company entitled to vote thereon approve a sale, lease, transfer, conveyance or other disposition (including, without limitation, any Investor (merger or consolidation), in a single transaction or series of related transactions, of all or substantially all of the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital equity interests or assets of the Company and its subsidiaries taken as a whole to a Person other than a Principal, the Company may require (a “the "Drag-Along Sale”Right") with the Holders of Covered Equity (each a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “"Drag-Along Purchaser”Holder") upon to participate in such terms transaction in accordance with this Section 2.3 and conditions as agreed to with vote in favor of such transaction, if applicable (any transaction involving the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request exercise of the Drag-Along SellerRight shall be referred to as a 'Drag-Along Sale"). (b) The Company shall notify, or cause to participate be notified, each Holder of Covered Equity in writing (a "Drag-Along Notice") of the proposed date of the Drag-Along Sale at least 30 days prior to the date thereof, setting forth the proposed amount of consideration and terms and conditions of payment to be offered in such Drag-Along Sale as set forth Sale, and the other material terms thereof. Each Drag-Along Holder hereby agrees to sell to the intended purchaser (the "Drag-Along Purchaser") all Covered Equity held by such Drag-Along Holder and to vote in this Section 9.1favor of such transaction, if applicable. (bc) If On the date of the Drag-Along Sale is structured as a sale of SharesSale, each Other Investor Drag-Along Holder shall sell deliver a certificate or certificates for its Covered Equity, duly endorsed for transfer with signatures guaranteed, to the Drag-Along Purchaser all Shares then held by in the manner and at the address indicated in the Drag-Along Notice against delivery of the purchase price for such Other Investor on Covered Equity. (d) Any Covered Equity purchased from the Drag-Along Holders pursuant to this Section 2.3 shall be paid for in the same type of consideration and at the same price per share and upon the same terms and conditions as are applicable to holders of the same type of securities included in the Drag-Along SellerSale or, including if like securities are not purchased from other holders, the same perFair Market Value of such securities. (e) Each Drag-share consideration Along Holder will, if requested by the Company, execute and deliver a Custody Agreement in form and substance reasonably satisfactory to the Company with respect to a specific class of Shares, and shall execute the necessary transfer forms Covered Equity to be included in favor of the Drag-Along Purchaser; provided Sale pursuant to this Agreement. The Custody Agreement will provide that the proceeds from Drag-Along Holder will deliver to and deposit in custody with the custodian and attorney-in-fact named therein (which may be an employee or officer of one of the Principals) a certificate or certificates representing the applicable Covered Equity (duly endorsed in blank by the registered owner or owners thereof or accompanied by duly executed stock powers in blank) and irrevocably appoint said custodian and attorney-in-fact as such sale Drag-Along Holder's agent and attorney-in-fact with full power and authority to act under a custody agreement and power of any Round C Investors shall not be less than attorney on behalf of such Drag-Along Holder with respect to the higher of matters specified therein relating to the proposed Drag-Along Sale. (if) Each Drag-Along Holder agrees that he or she will execute such other agreements as the Series A Liquidation Amount (as defined in the Memorandum and Articles) Company or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed may reasonably necessary by the Drag-Along Seller request in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e)transactions contemplated thereby. (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 1 contract

Samples: Tag Along Sales Agreement (Dayton Superior Corp)

Drag-Along Rights. (a) If, In the event that the Proposed Sale is a bona fide sale or other bona fide transfer for value of at any time prior to a Qualified IPO, any Investor (the “Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets least 50% of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by the Majority Stockholder to a non-affiliated third party (a “Third Party Purchaser”), the Majority Stockholder shall have the right to require each of the other Stockholders to sell, and each of the other Stockholders hereby agrees to sell, an equal percentage (by number and by class and series of security, provided that all series of common stock shall be counted as one series for purposes of determining this percentage and such Other Investor percentage shall be determined on a fully diluted basis) of his, her or its Shares (the “Drag Along Right”) to such Third Party Purchaser on the same terms and conditions as are applicable conditions, and at the same time as, the Proposed Sale. If the Majority Stockholder has by way of the Disposition Notice exercised its Drag Along Rights, then, promptly upon receipt of such Disposition Notice, each Stockholder (each a “Drag Along Stockholder”) shall deliver or cause to be delivered to the DragMajority Stockholder (or such other Person as may be agreed upon between the Majority Stockholder and each such Drag Along Stockholder) to be held by the Majority Stockholder (or such other agreed upon Person) in escrow for sale or return upon the terms of this Section 2.4, the certificate or certificates representing the Shares to be sold pursuant to this Section 2.4(b), duly endorsed or accompanied by executed stock powers, together with a limited power-Along Sellerof-attorney authorizing the Majority Stockholder to sell such Shares in accordance with the terms of this Section 2.4(b). To the fullest extent of the law, including the same per-share consideration Stockholders expressly waive any appraisal rights conferred under the Delaware General Corporation Law for any transaction with respect to a specific class of Shares, and shall execute which the necessary transfer forms in favor of the Drag-Drag Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such saleRight is validly exercised. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 1 contract

Samples: Stockholders’ Agreement (Fox Factory Holding Corp)

Drag-Along Rights. (a) If, If at any time prior to after twenty four (24) months from the Closing Date (as defined in the Subscription Agreement) a Qualified IPO, any Investor majority of the holders of Series A Shares (voting together as a single class) (the “Drag-Along SellerDragging Holders”) secures approve of an irrevocable offer to acquire purchase all share capital or substantially all of the equity or assets of any or all of the Company Group Companies (a “Drag-Along Sale”) with a valuation of the Company total gross proceeds (before expenses) of more than US$600,000,000 with any Person (such Person800 million in cash, a “Drag-Along Purchaser”) upon such terms and conditions as agreed acceptable to with a majority of the Drag-Along Sellerholders of Ordinary Shares (voting separately), then any other holders of Series A Shares and the Key Shareholders (the “Dragged Holders”) will agree to, and will vote in favor of, such Drag-Along Sale is agreed by a majority vote of and shall transfer their shares or ownership interest in the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate Group Company or Group Companies involved in such Drag-Along Sale as set forth required to effect the Drag-Along Sale, provided that any Drag-Along Sale shall not be deemed a Deemed Liquidation Event as defined in this Section 9.1the Amended and Restated Memorandum and Articles of Association of the Company (the “Restated Articles”) and provided further that in such case the proceeds of the Drag-Along Sale are distributed pro rata among the holders of the Ordinary Shares and the holders of the Series A Shares, on an as converted basis, notwithstanding the liquidation provisions of the Restated Articles. (b) If The Dragged Holders shall also procure all other shareholders of the relevant Group Companies to vote in favor of such Drag-Along Sale and to transfer their shares or ownership interest in the Group Company or Group Companies involved in such Drag-Along Sale as required to effect the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell Sale. Notwithstanding any provision to the Drag-Along Purchaser all Shares then held contrary, the share transfer restrictions as provided in Section 4.1 and Section 4.2 of this Agreement shall not apply to any Transfers made pursuant to this Section 4.7. (c) Any such sale or disposition by such Other Investor the Dragged Holders shall be on the same terms and conditions conditions, including, without limitation, as are applicable to the Drag-Along Sellerform of consideration, including as the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the proposed Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller Dragging Holders. The Dragged Holders shall be required to make customary and usual representations and warranties in connection with the Drag-Along Sale, including, without limitation, as to their ownership and authority to sell, free of all liens, claims and encumbrances of any kind, the shares proposed to be transferred or sold by such persons or entities and shall, without limitation as to time, indemnify and hold harmless to the full extent permitted by law, the Dragging Holders and the third party purchasers against all obligations, cost, damages, expenses, losses, judgments, assessments, or other liabilities including, without limitation, any action special, indirect, consequential or proposal that may preventpunitive damages, hinder any court costs, costs of preparation, attorney’s fees or impede the consummation expenses, or any accountant’s or expert witness’ fees arising out of, in connection with or related to any breach or alleged breach of any representation or warranty made by, or agreements, understandings or covenants of the Dragged Holders as the case may be, under the terms of the agreements relating to such Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Prior to making any Drag-Along Sale in which the Dragging Holders wish to exercise their rights under this Section, the Other Investors Dragging Holders shall provide the Company and the Dragged Holders with written notice (a the “Drag-Along Sale Notice”) not later less than ten thirty (1030) business days prior to such the proposed Drag-Along Sale. The date of the Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale PriceDate). The Drag-Along Notice shall set forth: (i) the name and all other material address of the third party purchasers; (ii) the proposed amount and form of consideration to be paid per share, and the terms and conditions of payment offered by each of the third party purchasers; (iii) the Drag-Along Sale Date; (iv) the number of shares held of record by the Dragging Holders on the date of the Drag-Along Sale. Each Other Investor shall Notice which form the subject to be required Transferred, sold or otherwise disposed of by the Dragging Holders; and (v) the number of shares of the Dragged Holders to participate be included in the Drag-Along Sale on the terms and conditions set forth in Sale. (e) On the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day periodDate, the Drag-Along Seller Dragged Holders shall again comply with the procedures set forth each deliver or cause to be delivered a certificate or certificates evidencing its shares to be included in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from duly endorsed for transfer with signatures guaranteed, to such third party purchasers in the manner and be subject to all of at the same provisions of the definitive agreements as are applicable to address indicated in the Drag-Along Seller, Notice. (iiif) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of If the Dragged Holders receive the purchase price for their shares or indemnification obligations; provided that an Other Investor shall only be obligated such purchase price is made available to indemnify any other Person in connection with such them as part of a Drag-Along Sale severally; providedand, furtherin either case they fail to deliver certificates evidencing their shares as described in this Section, that they shall for all purposes be deemed no Other Investor longer to be a shareholder of the relevant Group Company (with the record books of the Group Company including, as appropriate, its register of members updated to reflect such status), shall have no voting rights, shall not be obligated entitled to indemnify any dividends or other shareholder for any breach or misrepresentation by such other shareholder distributions with respect to title in such any shares held by them, shall have no other shareholder’s equity securities, (iv) be required to bear its proportionate share rights or privileges as a shareholder of the costs and expenses incurred Group Company and, in the event of liquidation of the Group Company, their rights with respect to any consideration they would have received if they had complied with this Section 4.7, if any, shall be subordinate to the rights of any equity holder. In addition, upon demand by the Dragging Holders and in addition to any other rights or remedies of the Dragging Holders granted herein or otherwise, the relevant Group Company shall stop any subsequent Transfer of any such shares held by the Dragged Holders. (g) Notwithstanding anything in Section 4.7 to the contrary, if the Company is actively pursuing a Qualified Public Offering and provides written notice thereof to the Investors Dragging Holders within ten (10) business days following receipt of a Drag Along Notice, the provisions of this Section 4.7 shall not apply so long as the Company is actively pursuing a Qualified Public Offering. As used hereunder, “actively pursuing” means that (i) the Board has within the past six (6) months authorized the Company’s management to select and engage, on behalf of the Company, an investment bank to act as managing underwriter in connection with its initial public offering, or (ii) an investment bank has been engaged as managing underwriter in connection with the proposed transaction (whether or not consummated), including all attorneyCompany’s fees initial public offering and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, continues to work on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Salesuch offering.

Appears in 1 contract

Samples: Shareholders Agreement (JA Solar Holdings Co., Ltd.)

Drag-Along Rights. (a) IfSubject to Sections 4.02(e), 4.02(f), 4.02(g) and 4.03, if at any time prior to a Qualified IPOafter the third anniversary hereof, any Investor Wind Acquisition (in such capacity, the “Drag-Along Seller”) secures an irrevocable offer proposes to acquire Transfer Company Equity Securities to any Third Party or Third Parties (the “Drag-Along Transferee”) in a single transaction or in a series of related transactions, and (i) the Company Equity Securities to be Transferred by the Drag-Along Seller represent all share capital or assets of the Company Equity Securities then owned by the Drag Along Seller and not less than the Initial Ownership of Wind Acquisition; and (ii) as of the date such Transfer is proposed to be consummated, by pro forma calculation as if such Drag-Along Sale was consummated, the Required Return shall have been achieved in respect of the aggregate Cost of the Company Equity Securities owned by CVPS at the time of such Drag-Along Sale. (any such Transfer, a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person), a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along SellerSeller may at its option require each Other Stockholder, and such each Other Stockholder hereby agrees, to Transfer its Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then Portion held by such Other Investor Stockholder, for the same consideration per share or unit of the relevant class of Company Equity Securities and otherwise on the same terms and conditions as are and applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares. All Other Stockholders shall cooperate in, and shall execute the necessary transfer forms in favor of take all actions that the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) Seller deems reasonably necessary or (ii) the purchase price as stated in the offer of desirable to consummate the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors Sale, including, without limitation, (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (ci) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the voting their respective Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares Equity Securities (or execute executing and deliver delivering any written consents in lieu thereof) in favor of any the Drag-Along Sale and all actions deemed reasonably necessary or appropriate by the Drag-Along Seller Board in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale, (ii) not exercising any dissenters’ or appraisal rights to which they may be entitled in connection with the Drag-Along Sale, and (iii) subject to Section 4.03(b), entering into agreements with the Drag-Along Transferee on terms substantially identical to those (if any) entered into between the Drag-Along Transferee and the Drag-Along Seller. If any Other Stockholder defaults in voting or transferring its Drag-Along Portion or taking any other action required by this Section 4.02(a), a representative designated by Wind Acquisition shall forthwith be deemed to be the duly appointed proxy and attorney-in-fact of such Other Stockholder with full power to vote the Company Equity Securities held by such Other Stockholder and to execute and deliver in the name and on behalf of such Other Stockholder all such agreements, instruments and other documentation (including any written consents of stockholders) as is required to Transfer the Company Equity Securities held by such Other Stockholder to the Drag-Along Transferee. (db) The Drag-Along Seller shall provide written notice of a proposed such Drag-Along Sale to the Other Investors Stockholders (a “Drag-Along Sale Notice”) not later than ten (10) 20 days prior to such the proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, Transferee and the per-Ordinary Share form and amount of consideration for which a transfer Transfer is proposed to be made (the “Drag-Along Sale Price”) ), the name of the proposed purchaser and all other material terms and conditions of the Drag-Along Sale. Each Other Investor Stockholder shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its SharesCompany Equity Securities. The price and form of consideration payable in such transfer Transfer shall be the Drag-Along Sale Price. Not later than 10 days after receipt of the Drag-Along Sale Notice (the “Drag-Along Sale Notice Period”), each of the Other Stockholders shall deliver to a representative of the Drag-Along Seller designated in the Drag-Along Sale Notice the certificate and other applicable instruments representing the Company Equity Securities of such Other Stockholder to be included in the Drag-Along Sale, together with wire transfer instructions for payment of the cash portion of the consideration to be received in such Drag-Along Sale, or, if such delivery is not permitted by applicable law, an unconditional agreement to deliver such Company Equity Securities pursuant to this Section 4.02(b) at the closing for such Drag-Along Sale against delivery to such Other Stockholder of the consideration therefor. If an Other Stockholder should fail to deliver such certificates to the Drag-Along Seller and the Drag-Along Sale is consummated, the Company shall cause the books and records of the Company to reflect that such Company Equity Securities are bound by the provisions of this Section 4.02(b) and that such Company Equity Securities shall be Transferred to the Drag-Along Transferee immediately upon surrender for Transfer by the holder thereof. (ec) The Drag-Along Seller shall have a period of 180 120 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for consummate the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice; provided, which that if such Drag-Along Sale is subject to regulatory approval, such 120-day period shall be promptly consummatedextended until the expiration of five Business Days after all such approvals have been received, subject to fulfilling any closing conditions and obtaining any required regulatory approvalsbut in no event later than 180 days after the date of receipt of the Drag-Along Sale Notice. If the Drag-Along Seller has Sale shall not entered into a definitive agreement providing for the Drag-Along Sale within have been consummated during such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply promptly return to each of the Other Stockholders all certificates and other applicable instruments representing Company Equity Securities that such Other Stockholders delivered for Transfer pursuant hereto, together with any other documents in the procedures set forth possession of the Drag-Along Seller executed by the Other Stockholders in connection with such proposed Transfer, and all the restrictions on Transfer contained in this Section 9.1(e)Agreement or otherwise applicable at such time with respect to such Company Equity Securities owned by the Other Stockholders shall again be in effect. (fd) In connection Concurrently with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature consummation of the Drag-Along Sale, (ii) benefit from and the Drag-Along Seller shall give notice thereof to the Other Stockholders, shall remit or cause to be subject remitted to all each of the same provisions Other Stockholders that have surrendered their certificates and other applicable instruments the total consideration to be paid at the closing of the definitive agreements Drag-Along Sale (the cash portion of which is to be paid by wire transfer of immediately available funds in accordance with such Other Stockholder’s wire transfer instructions) for the Company Equity Securities Transferred pursuant hereto, and shall furnish such other evidence of the completion and time of completion of such Transfer and the terms thereof as are may be reasonably requested by such Other Stockholders. (e) Notwithstanding anything contained in this Section 4.02, there shall be no liability on the part of the Drag-Along Seller to the Other Stockholders (other than the obligation to return the limited power-of-attorney and the certificates and other applicable to instruments representing Company Equity Securities received by the Drag-Along Seller) if the Transfer of Company Equity Securities pursuant to this Section 4.02 is not consummated for whatever reason, (iii) be required to bear its proportionate share regardless of any escrows, holdbacks or adjustments in respect of whether the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Seller has delivered a Drag-Along Sale severallyNotice. The decision to effect a Transfer of Company Equity Securities pursuant to this Section 4.02 by the Drag-Along Seller is in the sole and absolute discretion of the Drag-Along Seller. (f) Notwithstanding the foregoing, the Drag-Along Seller may cause a Drag-Along Sale pursuant to Section 4.02(a) in a Transfer for less than all of the outstanding Company Equity Securities to the extent that the Drag-Along Transferee requests that the Stockholders retain a sufficient number of Company Equity Securities to permit the use of leveraged recapitalization accounting for the Drag-Along Sale; provided, however, that such retained shares do not exceed 10% of the issued and outstanding Company Equity Securities and; provided, further, that CVPS may, at its option, transfer all of the Shares owned by CVPS at such time or retain a pro rata Share of the aggregate retained shares (based on their relative Ownership Percentage at such time). (g) The provisions of this Section 4.02 shall not apply to any Transfer of Company Equity Securities in, or in connection with, a Public Offering. CVPS’s obligations under this Section 4.02 shall no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder longer apply with respect to title any Company Equity Securities that CVPS Transfers to a Third Party or Third Parties otherwise in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection compliance with the proposed transaction (whether or not consummated), including all attorney’s fees provisions of Sections 3.01 and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale3.04 hereof.

Appears in 1 contract

Samples: Stockholders' Agreement (Central Vermont Public Service Corp)

Drag-Along Rights. (a) If, at In the event that any time prior the Xxxxx Stockholders propose to sell shares of Common Stock owned by it to any Proposed Purchaser other than any Transfer (i) pursuant to a Qualified IPORegistration or Rule 144, any Investor or (ii) to an Affiliate, and the “Drag-Along Seller”) secures an irrevocable offer shares proposed to acquire be sold, together with all share capital or assets shares of Common Stock previously sold by the Xxxxx Stockholders would represent more than 75% of the Company aggregate number of shares of Common Stock owned by the Xxxxx Stockholders immediately after the Closing, then the Xxxxx Stockholders may provide each other Stockholder written notice (a “Drag-Along SaleNotice”) with a valuation of such Proposed Sale and the Material Terms thereof not less than 25 business days prior to the proposed closing date of the Company Proposed Sale and each such Stockholder hereby agrees to sell to such Proposed Purchaser that number of more than US$600,000,000 with any Person shares Common Stock equal to the product of (i) the number of shares of Common Stock then held by such Person, a “Drag-Along Purchaser”Stockholder multiplied by (ii) upon such terms the aggregate percentage of Common Stock held by the Xxxxx Stockholders and conditions as agreed their Affiliates that is represented by the Common Stock that the Xxxxx Stockholders and their Affiliates propose to with sell in the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1Proposed Sale. (b) If the Shares of Common Stock subject to a Drag-Along Notice will be included in the Proposed Sale is structured as a sale of Sharespursuant hereto and to any agreement with the Proposed Purchaser relating thereto, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and subject to the same conditions as are applicable to the Drag-Along Sellershares of Common Stock which the Xxxxx Stockholders and their Affiliates propose to sell in the Proposed Sale. Such terms and conditions shall include, including the same per-share consideration with respect to a specific class of Shareswithout limitation, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount sale consideration (as defined which shall be reduced by the fees and expenses incurred by the Xxxxx Stockholders and the Company in connection with the Memorandum Proposed Sale) and Articles) or (ii) the purchase price as stated in provision of information, representations, warranties, covenants and requisite indemnifications, provided, however, that (x) any representations and warranties relating specifically to any Stockholder shall only be made by that Stockholder, (y) any indemnification provided by the offer of the Drag-Along Purchaser pro rata Stockholders shall be based on the number of Ordinary Shares held shares of Common Stock being sold by each Stockholder in the Proposed Sale either on a several, not joint, basis or solely with recourse to an escrow established for the benefit of the Proposed Purchaser and (z) that, with the consent of the Board and Xxxxx’x then current chief executive officer, the Xxxxx Stockholders or any of their Affiliates may receive non-cash consideration in connection with the Proposed Sale that is different from the consideration received by other Stockholders so long as the per share value of the consideration to be received by the Xxxxx Stockholders or any of their Affiliates is no greater than that to be received by such Round C Investors other Stockholders (on an as-converted basisas reasonably determined by the Board in good faith); provided, further, that except . No Stockholders shall exercise any dissenter’s rights with respect to the consummation of any liability incurred by such Other Investor individually, such Other Investor shall not be liable Proposed Sale pursuant to a Drag-Along Purchaser for an amount greater than the proceeds from such salethis Section 6.2. (c) If Each Stockholder will, if requested by the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares Xxxxx Stockholders (or any of their Affiliates), execute and deliver a Custody Agreement and Power of Attorney in form and substance satisfactory to the Xxxxx Stockholders (or any written consents such Affiliate of the Xxxxx Stockholders) with respect to the shares of Common Stock which are to be included in lieu thereof) the Proposed Sale pursuant to this Section 6.2. The Custody Agreement and Power of Attorney will provide, among other things, that each such Stockholder will deliver to and deposit in favor custody with the Xxxxx Stockholders, named as the custodian and attorney-in-fact therein, a certificate or certificates representing such shares of any Drag-Along Sale and all actions deemed reasonably necessary Common Stock (duly endorsed in blank by the Dragregistered owner or owners thereof or accompanied by duly endorsed stock powers in blank) and irrevocably appoint the Kelso Stockholders as such Stockholder’s agent and attorney-Along Seller in connection in-fact with full power and attorney to act under a custody agreement and power of attorney on behalf of such Stockholder with respect to the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Salematters specified therein. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to Each Stockholder agrees that such Stockholder will execute such other agreements as the Other Investors Xxxxx Stockholders (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions or any Affiliate of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (eXxxxx Stockholders) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors may reasonably request in connection with the proposed transaction (whether or not consummated), including all attorney’s fees consummation of a Proposed Sale and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along SellerNotice and the transactions contemplated thereby, an investment banking firm selected by the Drag-Along Seller and engagedincluding, on customary terms (including customary indemnification from the Company))without limitation, to the extent not paid by the Companyany purchase, and (v) to the extent permitted by applicable Lawmerger or recapitalization agreement, not exercise any dissenters’ escrow agreement or other ancillary agreements, proxies, written consents in lieu of meetings or waivers of appraisal rights to which they may be entitled in connection with a Drag-Along Salerights.

Appears in 1 contract

Samples: Management Subscription Agreement (Lri Holdings, Inc.)

Drag-Along Rights. If holders of at least seventy-five percent ----------------- (a75%) Ifof the then outstanding Preferred Shares approve a transaction to sell, at or in any time prior other way, directly or indirectly convey, assign, distribute, pledge, encumber or otherwise dispose of all or substantially all of the Company's assets, property or business or merge into or consolidate with any other corporation (other than a wholly-owned subsidiary of the Company) or effect any transaction or series of related transactions in which more than fifty percent (50%) of the voting power of the Company is disposed of (collectively, a "Drag- Along Transaction"), then, upon thirty (30) days written notice to a Qualified IPO, any Investor the other Stockholders and the Company (the "Drag-Along Seller”) secures an irrevocable offer to acquire all share capital or assets Notice"), which notice shall include reasonable details of the Company (a “Drag-Along Sale”) with a valuation proposed transaction, including the proposed time and place of closing and the Company of more than US$600,000,000 with any Person (consideration to be received by the Stockholders in such Persontransaction, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Sellereach Stockholder shall be obligated to, and shall sell, transfer and deliver, or cause to be sold, transferred and delivered, to such Drag-Along Sale is agreed by a majority vote third party, all of his Equity Securities in the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, same transaction at the request closing thereof (and will deliver certificates for all of his shares at the closing, free and clear of all liens, claims, or encumbrances except those arising under this Agreement and the Amended and Restated Investors' Rights Agreement of even date herewith). Each Common Holder shall receive the same consideration per share on an as-converted to Common Stock basis upon consummation of the Drag-Along Seller, Transaction as is received by the holders of Preferred Shares after giving effect to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale any liquidation preference to which any Person is structured as a sale of Shares, each Other Investor shall sell entitled to pursuant to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions Company's Certificate of Incorporation, as are applicable to the Drag-Along Selleramended; provided, including the same per-share consideration with respect to a specific class however, that if within thirty (30) days of Shares, and shall execute the necessary transfer forms in favor receipt of the Drag-Along Purchaser; provided that Notice, the proceeds from such Company irrevocably commits in writing to use its best efforts to complete a firm commitment underwritten public offering pursuant to an effective registration statement under the Securities Act covering the offer and sale of any Round C Investors shall the Company's Common Stock at a price per share of not be less than the higher of (i) price per share which the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer holders of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors Equity Securities (on an as-converted to Common Stock basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede would receive upon the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors Transaction (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify "Qualified IPO"), then the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions closing of the Drag-Along Sale. Each Other Investor Transaction shall be required to participate in suspended until the Drag-Along Sale on earlier of (i) one hundred twenty (120) days after the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. Company so commits or (eii) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice Company determines that it will be unable to enter into a definitive agreement providing for complete the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale Qualified IPO within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180120-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 1 contract

Samples: Stockholders' Agreement (Inflow Inc)

Drag-Along Rights. (a) If, at any time prior to The SLP Investors may give written notice (a Qualified IPO, any Investor (the “Drag-Along SellerNotice”) secures an irrevocable offer to acquire all share capital the Rollover Investor and his Permitted Transferees holding Share Equivalents, if any, that the SLP Investors intend to enter into a transaction or assets a series of related transactions involving the transfer, of not less than fifty percent (50%) of the Company outstanding Share Equivalents (which Share Equivalents to be transferred may include Share Equivalents held by other holders of Share Equivalents) to a Person or “group” of Persons (other than to the SLP Investors or an Affiliate of the SLP Investors), whether by merger, tender offer or otherwise (a “Drag-Along Sale”) with a valuation of ), and, that the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms SLP Investors desire to cause the Rollover Investor and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, his Permitted Transferees holding Share Equivalents to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor transaction on the same terms and conditions as are applicable available to the Drag-Along SellerSLP Investors; provided, including however, that the same per-share consideration Rollover Investor and such Permitted Transferees shall not be required to assume any liability or provide indemnification in connection with such transaction other than (i) liability or indemnification that relates to the ownership of, and the ability to transfer, the Share Equivalents being transferred by the Rollover Investor and such Permitted Transferees and (ii) with respect to a specific class of Sharesall other liabilities or indemnification in connection with such transaction, the Rollover Investor and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser Permitted Transferees’ aggregate pro rata share on the same terms and conditions as the SLP Investors (based on the number of Ordinary Shares held Share Equivalents being transferred by the Rollover Investor and such Round C Investors Permitted Transferees (on an as-converted basisin the aggregate) in such transaction); provided, further, provided that except with respect in no event shall the liability required to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary assumed by the Drag-Along Seller Rollover Investor or such Permitted Transferees or the indemnification required to be provided by the Rollover Investor or such Permitted Transferees exceed the amount of gross proceeds received by the Rollover Investor or such Permitted Transferees, as applicable, in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the . Such Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify also specify (1) the Drag-Along Purchaserconsideration, the per-Ordinary Share consideration for which a transfer is proposed if any, to be made (received by the “Drag-Along Sale Price”) SLP Investors and all the Rollover Investor and his Permitted Transferees holding Share Equivalents, if applicable, and any other material terms and conditions of the proposed transaction (which price and other material terms and conditions shall be the same in all material respects for the SLP Investors, the Rollover Investor and such Permitted Transferees), (2) the identity of the other Person or Persons party to the transaction, (3) the date of completion of the proposed transaction (which date shall be not less than ten (10) Business Days after the date of the notice) and (4) the action or actions required of the Rollover Investor and such Permitted Transferees in order to complete or facilitate such proposed transaction (including the sale of Share Equivalents held by the Rollover Investor and such Permitted Transferees, the voting of all such Share Equivalents in favor of any such merger, consolidation or sale of assets and the waiver of any related appraisal or dissenters’ rights). If the SLP Investors are transferring less than all of the Share Equivalents held by the SLP Investors, then the Rollover Investor and his Permitted Transferees holding Share Equivalents will transfer in the aggregate a number of Share Equivalents equal to the product of the following (the “Drag-Along Portion”): (x) the number of Share Equivalents beneficially owned by the Rollover Investor and his Permitted Transferees in the aggregate multiplied by (y) a fraction, the numerator of which is the aggregate number of Share Equivalents being transferred by the SLP Investors and the denominator of which equals the aggregate number of Share Equivalents beneficially owned by the SLP Investors immediately prior to the Drag Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of Upon receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions the Rollover Investor and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor his Permitted Transferees shall be obligated to indemnify any other shareholder for any breach take the action or misrepresentation by such other shareholder with respect actions referred to title in such other shareholder’s equity securities, clause (iv4) be required to bear its proportionate share above. (b) This Section 3.5 shall terminate on the expiration of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along SaleTransfer Restriction Period.

Appears in 1 contract

Samples: Shareholder Agreements (IPC Systems Holdings Corp.)

Drag-Along Rights. (a) IfIf the Investor proposes to Sell to any person or group of persons (other than an affiliate of the Investor or a Related Transferee and other than the Stockholders) (collectively, a "BUYER"), in a bona fide arm's-length transaction or series of transactions, including by way of a purchase agreement, tender offer, merger or other business combination transaction or otherwise, 10% or more (such percentage the "SALE PERCENTAGE") of the shares of Series B Preferred Stock beneficially owned by the Investor and any Group of which it is a member (any such transaction being referred to herein as a "MAJOR Sale"), then the Investor may elect to require each Stockholder to Sell the Sale Percentage of shares of Series B Preferred Stock beneficially owned by such Stockholder concurrently with such Major Sale to such Buyer at any time prior the purchase price per share, and upon the terms and conditions of, and with the same representations, warranties and covenants as apply to a Qualified IPOthe Investor in, any the Major Sale. (b) The rights set forth in this Section 3(a) shall be exercised by giving notice (the "SECTION 3 NOTICE") to each Stockholder setting forth in detail the terms of the proposed Sale, including without limitation, (i) the identity and address of the Buyer, (ii) the number of shares of Series B Preferred Stock proposed to be Sold by the Investor (the “Drag-Along Seller”"SALE STOCK"), (iii) secures an irrevocable offer the proposed amount and form of consideration to acquire all share capital be paid by the Buyer to the Investor and (iv) any other material terms or assets conditions of the Company (a “Drag-Along Sale”) with a valuation of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with the Drag-Along Sellerproposed Disposition, and such Drag-Along Sale is agreed by shall include a majority vote of statement to the other Investors and a majority vote of effect that the Founders, each other Investor (an “Other Investor”) agrees, at the request Buyer has been informed of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as a sale of Shares, each Other Investor shall sell to the Drag-Along Purchaser all Shares then held by such Other Investor on the same terms and conditions as are applicable to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount Rights (as defined in herein) and an acknowledgment by the Memorandum Buyer indicating that it has been so informed and Articlesagrees to such terms, and (vi) the proposed closing date of the Major Sale, which proposed date (the "SECTION 3 CLOSING DATE") shall be the later of (A) a business day not less than 15 or more than 60 days after such Section 3 Notice is delivered to the Stockholders or (iiB) the purchase price as stated in fifth business day following the offer receipt of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by all regulatory or third party consents and approvals, if any, applicable to such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such saleSale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall Stockholder will (i) make take all such representationsactions as may be requested by Investor to carry out the purposes of this Section 3, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from execute all documents containing such terms and be subject conditions, including, without limitation, representations and warranties with respect to all (x) matters of title to such Stockholder's securities and (y) the same provisions due authorization (or capacity) and due and valid execution and delivery by such Stockholder of the definitive agreements as are applicable to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments documentation in respect of the purchase price or indemnification obligations; provided that an Other Investor Major Sale, as those executed by the Investor, and shall only execute and deliver such other instruments and agreements as may be requested by the Investor. Each Stockholder shall be severally obligated to indemnify join on a pro-rata basis (based on such Shareholder's share of the aggregate proceeds paid in such Major Sale) in any other Person indemnification that is to be provided in connection with such Drag-Along Sale severally; providedMajor Sale, furtherother than any such indemnification that relates specifically to a particular Stockholder, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder as indemnification with respect to representations and warranties given by an Stockholder regarding such Stockholder's title in to and ownership of shares of Series B Preferred Stock or valid authorization by such other shareholder’s equity securities, (iv) be required Stockholder with respect to bear its proportionate share of the costs and expenses incurred by the Company and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along such Major Sale.

Appears in 1 contract

Samples: Stockholders Agreement (Interstate Hotels Corp)

Drag-Along Rights. (a) IfIf Beacon, as long as it holds at any time prior to a Qualified IPO, any Investor least the Pre-IPO Threshold (the "Drag-Along Seller”Initiator"), determines to Transfer or exchange (in a business combination or otherwise) secures an irrevocable offer to acquire all share capital in one or assets a series of bona fide arms-length transactions (collectively, the Company (a “"Drag-Along Sale”Transaction") with a valuation to an unrelated and unaffiliated third party all of the Company shares of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such terms and conditions as agreed to with Stock held by the Drag-Along SellerInitiator, and such then, upon 30 days written notice from the Drag-Along Sale is agreed by a majority vote Initiator to the other Shareholders that shall include reasonable details of the other Investors proposed transaction, including the proposed time and a majority vote place of closing and the Foundersconsideration to be received by the Shareholders, each other Investor (an “Other Investor”) agreesShareholder shall be obligated to, and shall, sell, Transfer and deliver, or cause to be sold, Transferred and delivered, to such third party, all of his shares of Stock in the same transaction at the request closing thereof (and will deliver certificates for all of his shares of Stock at the closing, free and clear of all liens, claims, or encumbrances) and the consideration paid in such transaction shall first be applied to pay the liquidation value of all outstanding Preferred Stock in accordance with the terms thereof and then pro rata among all holders of Stock on an as converted basis; provided, however, that if within 30 days of receipt of a notice from the Drag-Along Initiator as provided in this Section 8, the Company irrevocably commits, in writing, either (i) to use its best efforts to complete a Qualified IPO or (ii) to purchase all of the shares of Stock of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1. (b) If the Drag-Along Sale is structured as Initiator for a sale of Shares, each Other Investor shall sell cash amount equal to the Drag-Along Purchaser all Shares then held by such Other Investor on Value (as defined below) and the same terms and conditions as are applicable Company demonstrates to the Drag-Along Seller, including the same per-share consideration with respect to a specific class of Shares, and shall execute the necessary transfer forms in favor satisfaction of the Drag-Along Purchaser; provided Initiator that the proceeds from Company will be able to complete such sale of any Round C Investors shall not be less than purchase, then the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer closing of the Drag-Along Purchaser pro rata based on Transaction shall be suspended until the number earlier of Ordinary Shares held by (x) 120 days after the Company so commits or (y) the date the Company determines that it will be unable to complete the Qualified IPO within such Round C Investors 120-day period. If the Company fails to either (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than A) complete the proceeds from such sale. Qualified IPO within 120 days or (cB) If purchase the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by Initiator's shares at the Drag-Along Seller Value, the Drag-Along Initiator shall have the right to compel the Shareholders to satisfy the general provisions of this Section 8 in order to consummate the Drag-Along Transaction without further delay. As used in this Section 8, "Drag-Along Value" means, with respect to the consideration the Drag-Along Initiator would receive in connection with the Drag-Along SaleTransaction, the value of such consideration, which, to the extent other than cash, shall take into account, in addition to the cash value thereof, the assumptions and against any action or proposal that may prevent, hinder or impede the consummation of reasonable expectations underlying the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along PurchaserTransaction, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all including, without limitation, any anticipated tax benefit, synergies or other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions set forth in such Drag-Along Sale Noticeprojected economic benefits, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable confirmed by an independent investment bank reasonably satisfactory to the Drag-Along Seller, (iii) be required to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; provided, further, that no Other Investor shall be obligated to indemnify any other shareholder for any breach or misrepresentation by such other shareholder with respect to title in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred by the Company Initiator and the Investors in connection with the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions (including, if requested by the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 1 contract

Samples: Shareholders' and Voting Agreement (Doctors Health System Inc)

Drag-Along Rights. (a) IfAt any time, Rineon or any Permitted Transferee of Rineon (for the purposes of this Section 3.10, the “Initiating Shareholders”) may, in connection with a bona fide offer (a “Drag-Along Offer”) by a third party who is not an Affiliate of the Company or any Shareholder (for the purposes of this Section 3.10, a “Third Party”) to acquire for value all of the then outstanding Shares or all or substantially all of the assets or businesses of the Company (no matter how the transaction may be structured), require NatProv and all other Shareholders (each a “Drag-Along Shareholder”) to sell to such Third Party all of the Shares then held by such Shareholder or to vote their Shares in favor of such transaction if other than a sale of Shares as provided below; provided, however, that: (i) the Drag-Along Shareholders shall not be obligated to execute and deliver any document which (A) requires the Drag-Along Shareholders to make representations or warrants regarding any aspect whatsoever of the business or prospects of the Company and/or its Subsidiaries, provided that such Drag-Along Shareholders (so long as the Initiating Shareholders do at least the same), shall make representations and warranties to the effect that (x) such Drag-Along Shareholder is the legal and beneficial owner(s) of the securities being sold in the sale, free and clear of all liens, claims, security interests, restrictions, agreements of sale or other encumbrances (other than any time prior imposed by this Agreement, as amended and restated, and (y) such Drag-Along Shareholder has the capacity or power and authority to effect such sale), (B) would subject such Drag-Along Shareholder to restrictive covenants, or (C) requires such Drag-Along Shareholder to be obligated for any indemnification or other obligations other than (so long as the Initiating Shareholders do at least the same) (1) the obligation to join on a pro-rata basis (but not on a joint and several basis), based on its respective share of the aggregate proceeds paid by the purchaser in such sale (but only up to the amount of net proceeds actually received by such Drag-Along Shareholder in the sale), in any indemnification that the Initiating Shareholders have agreed to, and (2) any such obligations that relate specifically to a Qualified IPOparticular Shareholder such as indemnification with respect to representations and warranties given by a Shareholder regarding such Shareholder’s title to and ownership of Shares; (ii) if the Initiating Shareholders elect to exercise their rights under this Section 3.10(a), any Investor the Drag-Along Shareholders receive either cash or marketable securities (i.e., securities that are actively publicly traded on the NYSE, NYSE Alternext Exchange, NASDAQ or similar exchange or quotation system) in such sale. If the Initiating Shareholders elect to exercise their right to compel a sale pursuant to this Section 3.10, the Initiating Shareholders will cause a written notice of the Drag-Along Offer (the “Drag-Along SellerNotice”) secures an irrevocable offer to acquire all share capital or assets be delivered to each of the Company (a “Drag-Along Sale”) with a valuation other Shareholders, setting forth the aggregate consideration, the identity of the Company of more than US$600,000,000 with any Person (such Person, a “Drag-Along Purchaser”) upon such Third Party and the other principal terms and conditions as agreed to with the Drag-Along Seller, and such Drag-Along Sale is agreed by a majority vote of the other Investors and a majority vote of the Founders, each other Investor (an “Other Investor”) agrees, at the request of the Drag-Along Seller, to participate in such Drag-Along Sale as set forth in this Section 9.1thereof. (b) If The Initiating Shareholders will have one hundred twenty (120) days from the date the Drag-Along Sale Notice is structured as a sale of Shares, each Other Investor shall sell given to the Drag-Along Purchaser all Shares then held by such Other Investor on other Shareholders to consummate the same terms and conditions as are applicable sale to the Drag-Along SellerThird Party, including at the same per-share consideration with respect to a specific class of Shares, price and shall execute the necessary transfer forms in favor of the Drag-Along Purchaser; provided that the proceeds from such sale of any Round C Investors shall not be less than the higher of (i) the Series A Liquidation Amount (as defined in the Memorandum and Articles) or (ii) the purchase price as stated in the offer of the Drag-Along Purchaser pro rata based on the number of Ordinary Shares held by such Round C Investors (on an as-converted basis); provided, further, that except with respect to any liability incurred by such Other Investor individually, such Other Investor shall not be liable to a Drag-Along Purchaser for an amount greater than the proceeds from such sale. (c) If the Drag-Along Sale is structured as a merger, amalgamation or scheme of arrangement of the Company or other transaction that requires the approval of the Investors, each Investor shall vote its respective Shares (or execute and deliver any written consents in lieu thereof) in favor of any Drag-Along Sale and all actions deemed reasonably necessary by the Drag-Along Seller in connection with the Drag-Along Sale, and against any action or proposal that may prevent, hinder or impede the consummation of the Drag-Along Sale. (d) The Drag-Along Seller shall provide written notice of a proposed Drag-Along Sale to the Other Investors (a “Drag-Along Sale Notice”) not later than ten (10) days prior to such proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Purchaser, the per-Ordinary Share consideration for which a transfer is proposed to be made (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale. Each Other Investor shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Sale Notice and substantially similar to tender its Shares. The price and form of consideration payable in such transfer shall be the Drag-Along Sale Price. (e) The Drag-Along Seller shall have a period of 180 days from the date of receipt of the Drag-Along Sale Notice to enter into a definitive agreement providing for the Drag-Along Sale on the terms and conditions those set forth in such Drag-Along Sale Notice, which Drag-Along Sale shall be promptly consummated, subject to fulfilling any closing conditions and obtaining any required regulatory approvals. If the Drag-Along Seller has not entered into a definitive agreement providing for the Drag-Along Sale within such 180-day period and the Drag-Along Seller proposes to effect a Drag-Along Sale after such 180-day period, the Drag-Along Seller shall again comply with the procedures set forth in this Section 9.1(e). (f) In connection with a Drag-Along Sale, each Other Investor shall (i) make such representations, warranties and covenants and enter into such definitive agreements as are customary for transactions of the nature of the Drag-Along Sale, (ii) benefit from and be subject to all of the same provisions of the definitive agreements as are applicable Shares subject to the Drag-Along SellerOffer pursuant to Subsection (a). If the sale to the Third Party is not completed during such one hundred twenty (120) day period, (iii) then the other Shareholders will be required released from their obligations with respect to bear its proportionate share of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations; provided that an Other Investor shall only be obligated to indemnify any other Person in connection with such Drag-Along Sale severally; providedNotice (but not future Drag-Along transactions). (c) Subject to Section 3.10(b), furthereach Shareholder agrees to cast all votes to which such Shareholder is entitled in respect of its Shares, that no Other Investor shall be obligated to indemnify whether at any other shareholder for any breach annual or misrepresentation special meeting, by such other shareholder with respect to title written consent or otherwise, in such other shareholder’s equity securities, (iv) be required to bear its proportionate share of the costs and expenses incurred same proportion as Shares are voted by the Company and the Investors Initiating Shareholders to approve any transaction or series of transactions in connection with which the proposed transaction (whether or not consummated), including all attorney’s fees and charges, all accounting fees and charges and all finders, brokerage or investment banking fees, charges or commissions Initiating Shareholders exercise their rights in this Section 3.10 (including, if requested by without limitation, any recapitalization, merger, consolidation, reorganization or sale of all or substantially all of the Drag-Along Seller, an investment banking firm selected by the Drag-Along Seller and engaged, on customary terms (including customary indemnification from assets of the Company)), to the extent not paid by the Company, and (v) to the extent permitted by applicable Law, not exercise any dissenters’ or appraisal rights to which they may be entitled in connection with a Drag-Along Sale.

Appears in 1 contract

Samples: Shareholder Agreement (Rineon Group Inc)

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