Tag-Along Rights (a) If any Class A-2 Member, Class C Member or the GM Investor or its Affiliates in their capacity as a Class F Preferred Member (the “Transferring Holder”) proposes to Transfer Class A-2 Preferred Shares, Class C Common Shares or Class F Preferred Shares (or any other Equity Securities held by such Member) to an Independent Third Party prior to an IPO (other than any Transfer (i) as provided in Section 9.08, (ii) as provided in Section 9.09, (iii) in connection with Section 9.10 or (iv) as provided in Section 9.12), then the Transferring Holder(s) shall deliver a written notice (such notice, the “Tag Notice”) to the Company, each Class D Member, each Class A-1 Preferred Member, each Class E Member and each Class F Preferred Member (the “Participation Members,” provided that, for clarity, such Transferring Holder will not be a Participation Member in its capacity as a Class F Preferred Member, notwithstanding that such Transferring Holder may hold Class F Preferred Shares) at least thirty (30) days prior to making such Transfer, specifying in reasonable detail the identity of the prospective transferee(s), the number of Class A-2 Preferred Shares or Class C Common Shares (or any other Equity Securities held by such Members) to be Transferred and the price and other terms and conditions of the Transfer. Each Participation Member may elect to participate in the contemplated Transfer in the manner set forth in this Section 9.07 by delivering an irrevocable written notice to the Transferring Holder(s) within fifteen (15) days after delivery of the Tag Notice, which notice shall specify the number of Class A-1 Preferred Shares, Class D Common Shares, Class E Common Shares and Class F Preferred Shares (or any other Equity Securities held by such Members) that such Participation Member desires to include in such proposed Transfer. If none of the Participation Members gives such notice prior to the expiration of the fifteen (15) day period for giving such notice, then the Transferring Holder(s) may Transfer such Class A-2 Preferred Shares or Class C Common Shares (or any other Equity Securities held by such Members) to any Person at the same price and on other terms and conditions that are no more favorable, in the aggregate, to the Transferring Holder(s) than those set forth in the Tag Notice. If any Participation Members have irrevocably elected to participate in such Transfer prior to the expiration of the fifteen (15) day period for giving notice, each Participation Member shall be entitled to sell in the contemplated Transfer a total number of Class A-1 Preferred Shares with respect to Class A-1 Preferred Members, Class D Common Shares with respect to Class D Members, Class E Common Shares with respect to Class E Members, Class F Preferred Shares with respect to Class F Preferred Members (the “Tagged Shares”) to be sold in the Transfer, to be calculated according to the following methodology:
(i) First, all Non-A-1 Interests owned by the Transferring Holder are deemed converted (on a Fully Diluted Basis) to Class D Common Shares on a 1:1 basis (as adjusted, as necessary, to reflect appropriate and proportional adjustments to take into account any subdivision, reorganization, reclassification, recapitalization, stock split, reverse stock split, combination of shares or similar event), all Class A-1 Preferred Shares held by all Participation Member(s) are deemed converted to Class D Common Shares pursuant to Section 2.10(b), all Class E Common Shares held by all Participation Member(s) are deemed converted to Class D Common Shares on a 1:1 basis (as adjusted, as necessary, to reflect appropriate and proportional adjustments to take into account any subdivision, reorganization, reclassification, recapitalization, stock split, reverse stock split, combination of shares or similar event) and all Class F Preferred Shares held by all Participation Member(s) are deemed converted to Class D Common Shares at the Class F Preferred Share Conversion Ratio (collectively the number of Class D Common Shares resulting from the deemed conversion, plus the number of Class D Common Shares held by the Participation Members prior to such deemed conversion, the “Total Conversion Shares”). For clarity, such “deemed” conversion pursuant to this Section 9.07(a) shall solely be for the purposes of calculating the Tagged Shares, and no actual conversion shall occur pursuant to this Section 9.07(a).
(ii) Second, the total number of Shares that are subject to Transfer is determined (the “Total Tagged Shares”).
(iii) Third, the Tagged Shares will be:
(A) a number of Class A-1-A Preferred Shares equal to: (1) Total Tagged Shares multiplied by a fraction, (x) the numerator of which is the number of Class D Common Shares into which the Class A-1-A Preferred Shares of such Participation Member were deemed converted pursuant to subsection (i) above, and (y) the denominator of which is the Total Conversion Shares divided by, (2) the A-1-A Preferred Share Conversion Ratio;
(B) a number of Class A-1-B Preferred Shares equal to: (1) Total Tagged Shares multiplied by a fraction, (x) the numerator of which is the number of Class D Common Shares into which the Class A-1-B Preferred Shares of such Participation Member were deemed converted pursuant to subsection (i) above, and (y) the denominator of which is the Total Conversion Shares divided by, (2) A-1-B Preferred Share Conversion Ratio;
(C) a number of Class D Common Shares equal to: Total Tagged Shares multiplied by a fraction, (1) the numerator of which is the number of Class D Common Shares held by such Participation Member prior to the deemed conversion pursuant to subsection (i) above, and (2) the denominator of which is the Total Conversion Shares;
(D) a number of Class E Common Shares equal to: Total Tagged Shares multiplied by a fraction, (1) the numerator of which is the number of Class E Common Shares held by such Participation Member prior to the deemed conversion pursuant to subsection (i) above, and (2) the denominator of which is the Total Conversion Shares; and
(E) a number of Class F Preferred Shares equal to: Total Tagged Shares multiplied by a fraction, (1) the numerator of which is the number of Class F Preferred Shares held by such Participation Member prior to the deemed conversion pursuant to subsection (i) above, and (2) the denominator of which is the Total Conversion Shares.
(b) Immediately prior to the consummation of the Transfer to the Independent Third Party, the Tagged Shares (other than Class E Common Shares and Class F Preferred Shares) will be automatically, and without any further action, be actually converted into Class D Common Shares pursuant to Section 2.10(b). The Transferring Holder(s) and each participating Participation Member shall receive the same form of consideration and the aggregate net consideration (after such aggregate net consideration is adjusted for Company expenses, purchase price adjustments, escrow amounts, purchase price holdbacks, indemnity obligations and other similar items) shall be divided ratably among the Transferring Holder and each participating Participation Member based upon their respective numbers of Shares included in the Transfer.
(c) Notwithstanding anything to the contrary in this Section 9.07, the Transferring Holder(s) shall not consummate the Transfer contemplated by the Tag Notice at a higher price or on other terms and conditions more favorable to them, in the aggregate, than the terms set forth in the Tag Notice (including as to price per Class A-1 Preferred Share or form of consideration to be received) unless the Transferring Holder(s) shall first have delivered a second notice setting forth such more favorable terms (the “Amended Tag Notice”) to each Participation Member who had not elected to participate in the contemplated Transfer. Each Participation Member receiving an Amended Tag Notice may elect to participate in the contemplated Transfer on such amended terms by delivering written notice to the Transferring Holder(s) not later than ten (10) Business Days after delivery of the Amended Tag Notice.
(d) Each Participation Member shall pay his, her or its own costs of any sale and a pro rata share (based upon the reduction in proceeds that would have been allocated to such Member if the amount of such expense were not included in the aggregate consideration) of the expenses incurred by the Members (to the extent such costs are incurred for the benefit of all of such Members and are not otherwise paid by the Transferee) and the Company in connection with such Transfer and shall be obligated to provide the same customary representations, warranties, covenants, agreements, indemnities and other obligations that the Transferring Holder(s) agrees to provide in connection with such Transfer; provided, that in no event will a Participation Member be required to enter into a non-competition agreement or be subject to any similar covenant or provision. Except as contemplated by the preceding sentence, each Participation Member shall execute and deliver all documents required to be executed in connection with such tag-along sale transaction.
(e) Without limiting the generality of the other provisions of this Section 9.07, the Transferring Holder(s) shall decide whether or not to pursue, consummate, postpone or abandon any Transfer and, subject to the limitations set forth in this Section 9.07, the terms and conditions thereof. None of the Transferring Holder(s) nor any of their respective Affiliates shall have any liability to any Member arising from, relating to or in connection with the pursuit, consummation, postponement, abandonment or terms and conditions of any such Transfer except to the extent the Transferring Holder(s) shall have failed to comply with any of the other provisions of this Section 9.07.
Tag-Along Right (a) If, at any time prior to a Qualified IPO, one or more Sponsor Members propose to Transfer, in a single transaction or a series of related transactions, a number of Units representing at least 30% of the Sponsor Members' aggregate Initial Equity Stakes (as defined in the LLC Agreement) to any Person (other than a Transfer to a Permitted Transferee (as defined in the LLC Agreement) of any such Sponsor Member and other than a Transfer in accordance with the Registration Rights Agreement and other than to another Sponsor Member) (a "Tag-Along Purchaser"), then, unless such transferring Sponsor Member(s) are entitled to give and do give a Drag-Along Sale Notice (as defined in the LLC Agreement) and no other Sponsor Member(s) has elected to purchase its pro rata share of such Units pursuant to Section 2.04(a) of the Sponsor Agreement, the Company shall first provide written notice to each of the Management Members, which notice (the "Tag-Along Notice") shall state: (i) the maximum number of Units proposed to be Transferred (the "Tag-Along Securities"); (ii) the purchase price per Unit (the "Tag-Along Price") for the Tag-Along Securities and (iii) any other material terms and conditions of such sale, including the proposed transfer date (which date will be within 60 business days after the termination of the Election Period (defined below), subject to extension for any required regulatory approvals). Each of the Management Members that has been provided with the Tag-Along Notice (each, a "Tag-Along Manager") shall have the right to sell to such Tag-Along Purchaser, upon the terms set forth in the Tag-Along Notice, up to the aggregate number of Units which are held by such Tag-Along Manager multiplied by a fraction, the numerator of which is the aggregate number of Units proposed to be sold by the transferring Sponsor Member as reflected in the Tag-Along Notice and the denominator of which is the total number of Units which are held by the transferring Sponsor Member. If the number of Units elected to be sold by the Tag-Along Managers and any other individuals identified from time to time on Exhibit A to the LLC Agreement, the transferring Sponsor Member and any other Sponsor Members electing to participate in such sale is greater than the number of Tag-Along Securities specified in the Tag-Along Notice, the number of Units being sold by each such seller shall be reduced such that the applicable seller shall be entitled to (and obligated to) sell only their pro rata share of Units (based on the aggregate number of Units held by such seller to the total number of Units held by all of such electing sellers). The transferring Sponsor Member(s), the Sponsor Members electing to participate in such sale and the Tag-Along Manager(s) exercising their rights pursuant to this Section 2.04 shall effect the sale of the Tag-Along Securities, and such Tag-Along Manager(s) shall sell the number of Tag-Along Securities required to be sold by such Tag-Along Manager(s) pursuant to this Section 2.04(a) within 60 business days after the expiration of the Election Period, subject to extension for any required regulatory approvals.
(b) The tag-along rights provided by this Section 2.04 must be exercised by any Tag-Along Manager wishing to sell its Units within 10 business days following the date of delivery of the Tag-Along Notice (the "Election Period"), by delivery of a written notice to the Company indicating such Tag-Along Manager's wish to irrevocably exercise its rights and specifying the number of Units (up to the maximum number of Units owned by such Tag-Along Manager requested to be purchased by such Tag-Along Purchaser) it wishes to sell; provided that any Tag-Along Manager may waive its rights under this Section 2.04 prior to the expiration of such 10-business day period by giving written notice to the Company, which will be distributed by the Company to the transferring Sponsor Member(s). The failure of a Tag-Along Manager to respond within such 10-business day period shall be deemed to be a waiver of such Tag-Along Manager's rights under this Section 2.04.
(c) In connection with any sale pursuant to this Section 2.04, each Tag-Along Manager shall make to the Tag-Along Purchaser the same representations, warranties, covenants, indemnities and agreements as the transferring Sponsor Member(s) makes in connection with the proposed transfer (except that in the case of representations, warranties, covenants, indemnities and agreements pertaining specifically to the transferring Sponsor Member(s), a Tag-Along Manager shall make the comparable representations, warranties, covenants, indemnities and agreements); provided that all representations, warranties and indemnities shall be made by the transferring Sponsor Member(s) and such Tag-Along Manager severally and not jointly and that the liability of the transferring Sponsor Member(s) and such Tag-Along Manager thereunder shall be borne by each of them on a pro rata basis. The Tag-Along Managers shall receive the same type and amount of consideration (and rights) per Unit as is paid or delivered to the transferring Sponsor Member(s) in the sale pursuant to Section 2.04(a).
(d) No Transfer of any Unit pursuant to this Section 2.04 shall be effective unless and until the applicable transferee agrees to be bound by all of the terms and conditions of the LLC Agreement.
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.
Drag Along Right Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.
Tag Along 2.1. If TIC and/or any of its Subsidiaries (collectively, “the Shareholder”) proposes to sell, in one or a series of related transactions, any of its Shares and/or Convertible Securities to any person and/or any of such person’s Affiliates (other than non-prearranged sales of Shares into the market executed on any stock exchange on which the Shares are then listed for trading or submitted for quotation), such that, immediately following any such sale, the Shareholder would cease to be the largest holder of: (a) the then issued and outstanding Shares (for the avoidance of doubt, not taking into account any Convertible Securities); or (b) the Shares on a fully-diluted basis, taking into account the Convertible Securities (for the avoidance of doubt, as determined pursuant to clause 1.3 above), the Shareholder may only sell such Shares or Convertible Securities if it complies with the provisions of this clause 2.
2.2. TIC shall give written notice (“the Offer Notice”) to the Bank of such intended sale on the earlier of (i) 5 (five) days after any person or persons comprising the Shareholder enters into an agreement to effect such sale (whether or not subject to conditions) and (ii) 30 (thirty) days prior to the Proposed Sale Date (as defined below). The Offer Notice shall specify the identity of the proposed purchaser (“the Third Party Purchaser”), the purchase price (“the Purchase Price”), including the purchase price per Share (“the Per Share Price”), and other terms and conditions of payment, the proposed date of sale (“the Proposed Sale Date”), the number of Shares and/or Convertible Securities (together with details of such Convertible Securities) proposed to be purchased by the Third Party Purchaser (“the Offered Shares”) and the percentage that the Offered Shares represent of all (a) Shares owned by the Shareholder, in the event the Shareholder proposes to sell Shares only and/or only clause 2.1(a) above is applicable; or (b) the Shareholder’s Shares and Convertible Securities, in the event that the Shareholder proposes to sell both Shares and Convertible Securities or Convertible Securities only and clause 2.1(b) above is (or for the avoidance of doubt, both clauses 2.1(a) and 2.1(b) above are) applicable. For the avoidance of doubt, the Offer Notice shall describe any other transactions relating to the Shares and/or Convertible Securities with the Third Party Purchaser and/or its Affiliates that have taken place or are proposed to take place or certify that no such transaction has taken place or are proposed to take place.
2.3. The Bank shall be entitled, by written notice given to TIC within 20 (twenty) days of receipt of the Offer Notice, to join (and, if applicable, have its Affiliates join) the sale to such Third Party Purchaser. If the Bank has notified the Shareholder of its election to exercise its tag along rights under this clause 2, the Shareholder shall, as a condition to the sale by it of any of the Offered Shares, cause the Third Party Purchaser to purchase from the Bank Group the number of the Bank Group’s (i) Capital Notes issued pursuant to clause 5.4 of the Amending Agreement or Shares received from the conversion of such Capital Notes; (ii) Capital Notes and/or convertible debentures issued as part of the Clause 9.4 Equity Issuances or Shares received from the conversion of such Capital Notes and/or convertible debentures; and (iii) Shares received as part of the Clause 9.4 Equity Issuances (collectively, “the Bank Group’s Shares”) multiplied by the Bank Group’s Percentage (as determined pursuant to clause 2.4 below)) on the same terms and conditions (per Share) as those set out in the Offer Notice. For the avoidance of doubt, the Per Share Price for Capital Notes and/or convertible debentures of Tower held by the Shareholder shall be the total purchase price offered for such Convertible Securities divided by the number of Shares into which such Convertible Securities are then convertible.
2.4. The Bank shall be entitled to sell to the Third Party Purchaser such percentage of the Bank Group’s Shares equal to the percentage (“the Bank Group’s Percentage”) which the Offered Shares constitute of all Shares and, if applicable, Convertible Securities, held by the Shareholder (as determined pursuant to clauses 2.1(a), 2.1(b), 2.2(a) and 2.2(b) above, as applicable, and, for the avoidance of doubt, as determined pursuant to clause 1.3 above). The number of Offered Shares proposed to be sold by the Shareholder shall be reduced if and to the extent necessary to provide for the exercise of the “tag along” rights set forth in this clause 2. The number of Shares and/or Convertible Securities actually sold to the Third Party Purchaser by the Bank Group as a proportion of the number of Shares and/or Convertible Securities actually sold by the Shareholder to the Third Party Purchaser shall be referred to as “the Bank Group’s Proportion”. In effecting any such sale to the Third Party Purchaser, the Bank Group shall be entitled to substitute Capital Notes and/or convertible debentures convertible into all or a portion of the number of Shares to be sold by the Bank Group pursuant to this clause 2.
2.5. For the avoidance of doubt, if the Bank shall have exercised its “tag along” right as aforesaid, TIC shall procure that no person comprising the Shareholder shall sell any Shares or Convertible Securities to the Third Party Purchaser without the Bank Group joining in such sale, as aforesaid.
2.6. Notwithstanding anything to the contrary in this Agreement, no person comprising the Bank Group shall be required to make any representations or warranties to the Third Party Purchaser regarding any matters except the ownership of, and title to, the Shares and/or Convertible Securities to be sold by such person to the Third Party Purchaser as aforesaid, nor shall any person comprising the Bank Group be required to agree to any undertakings except to deliver the Shares and/or Convertible Securities to the Third Party Purchaser against payment therefor in accordance with this clause 2, provided that in the event that (a) not all of the Purchase Price is received by the Shareholder at the closing of the sale to the Third Party Purchaser because of a requirement that the Shareholder place a portion of the Purchase Price into escrow to secure representations, warranties or covenants (other than those related to the Shareholder (and not Tower) and/or its title to the Shares and/or Convertible Securities being sold), a portion of the Purchase Price equal to the Bank Group’s Proportion multiplied by the amount of Purchase Price placed into escrow by the Shareholder shall also be placed into escrow and (b) any payment is made to the Third Party Purchaser (whether from such escrow or not) on account of an indemnification obligation of the Shareholder (other than an indemnification obligation related to (i) representations, warranties or covenants relating to the Shareholder (and not Tower) and/or its title to the Shares and/or Convertible Securities sold and/or (ii) a fraudulent misrepresentation fraudulently made by the Shareholder (such payment, after such exclusion, “an Indemnification Payment”), the amount to be released from such escrow to the Bank Group shall be reduced by the Bank Group’s Proportion of the Indemnification Payment or the Bank Group shall pay the Shareholder or the Third Party Purchaser the Bank Group’s Proportion of the Indemnification Payment, as applicable. For the avoidance of doubt, no placement into escrow and/or sharing in an Indemnification Payment as aforesaid shall be construed to mean that the Bank Group has any liability whatsoever to any person, including the Third Party Purchaser, on account of the representations, warranties or covenants of the Shareholder, such placement and/or sharing representing only an adjustment between TIC and the Bank of the tag along right granted pursuant to this clause 2 to reflect when the Purchase Price is actually received by TIC out of such escrow and/or the actual Price Per Share finally received by TIC after such Indemnification Payment.
2.7. For the avoidance of doubt, (a) in the event the transactions contemplated by an Offer Notice shall not be consummated by the Shareholder for any reason, the Bank Group shall not be required to sell any Shares or Convertible Securities to the Third Party Purchaser and (b) in the event that the Shareholder proposes to sell to a different third party or on terms and conditions other than as set forth in the Offer Notice or in the event that the transaction is not consummated within 2 (two) months after the Bank’s notification of its exercise of its “tag along” rights hereunder, then TIC shall procure that no person comprising the Shareholder shall proceed with any sale without TIC again complying with the terms and conditions of this Clause 2.
2.8. TIC shall cause its Subsidiaries to act in accordance with this Agreement.
Drag Along If the holders of a majority of the shares of the Company’s voting stock then-outstanding (the “Majority Holders”) propose to sell, assign or transfer, directly or indirectly, all of their shares of capital stock of the Company to any third party (a “Drag-Along Transfer”), the Majority Holders may exercise drag-along rights in accordance with and subject to the terms, conditions and procedures set forth in this Section 9 (“Drag-Along Rights”).
(a) The Majority Holders shall give written notice (a “Drag-Along Notice”) at least fifteen (15) days prior to the consummation of such proposed Drag-Along Transfer to Participant of any election by the Majority Holders to exercise their Drag-Along Rights hereunder, setting forth (i) the shares proposed to be transferred, (ii) the consideration to be received for such shares, (ii) the identity of the prospective transferee, and (iv) any other material terms and conditions of the proposed transaction. Such notice shall also specify the aggregate number of shares Participant shall be required to transfer. Any transfer of shares by Participant pursuant to the terms hereof shall be for the same amount and form of consideration per share as the Majority Holders will receive in such Drag-Along Transfer, as specified in the Drag-Along Notice.
(b) Within seven (7) days of delivery of the Drag-Along Notice, Participant shall deliver to the Majority Holders such instruments of transfer as shall be reasonably requested by the Majority Holders or the prospective transferee, including, as applicable, one or more stock certificates, properly endorsed for transfer to the transferee, together with a limited power-of-attorney authorizing the Majority Holders to transfer such Shares on the terms set forth in the Drag-Along Notice.
(c) In the event that any transfer pursuant to this Section 9 is structured as a merger, consolidation or business combination, or any sale of all or substantially all assets, Participant must further agree to (i) vote or provide a written consent in favor of the transaction, (ii) take such other action within its power, at no cost to it (other than fees and expenses payable to its advisors, which shall be paid by Participant), as may be required to effect such transaction, and (iii) take all action to waive any dissenters, appraisal or other similar rights with respect thereto.
(d) If the Drag-Along Transfer is not consummated within one hundred and eighty (180) days after delivery of the Drag-Along Notice, the Majority Holders shall (i) return to each Drag-Along Holder the limited power-of-attorney and all certificates representing the shares that Participant delivered pursuant to this Section 9 and any other documents in the possession of the Majority Holders executed by Participant in connection with the proposed Drag-Along Transfer.
(e) Notwithstanding the foregoing, a Drag-Along Holder will not be required to comply with this Section 9 in connection with any proposed Drag-Along Transfer, unless:
(i) Any representations and warranties to be made by Participant in connection with the Drag-Along Transfer are limited to representations and warranties related to authority, ownership and the ability to convey title to the Shares, including, but not limited to, representations and warranties that (i) Participant holds all right, title and interest in and to the Shares that Participant purports to hold, free and clear of all liens and encumbrances, (ii) the obligations of Participant in connection with the transaction have been duly authorized, if applicable, (iii) the documents to be entered into by Participant have been duly executed by Participant and delivered to the acquirer and are enforceable against Participant in accordance with their respective terms; and (iv) neither the execution and delivery of documents to be entered into in connection with the transaction, nor the performance of Participant’s obligations thereunder, will cause a breach or violation of the terms of any agreement, law or judgment, order or decree of any court or governmental agency;
(ii) Participant shall not be liable for the inaccuracy of any representation or warranty made by any other person in connection with the Drag-Along Transfer, 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 of the identical representations, warranties and covenants provided by all stockholders);
(iii) the liability for indemnification, if any, of Participant in the Drag-Along Transfer and for the inaccuracy of any representations and warranties made by the Company, the Majority Holders or the Purchaser in connection with such Drag-Along Transfer, is several and not joint (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 of the identical representations, warranties and covenants provided by all stockholders), and subject to any provisions of the Company’s certificate of incorporation and bylaws, as amended, related to the allocation of the escrow, is pro rata in proportion to, and does not exceed, the amount of consideration paid to Participant in connection with such Drag-Along Transfer; and
(iv) upon the consummation of the Drag-Along Transfer, Participant will receive the same amount and form of consideration per share for Participant’s shares as is received by the Majority Holders.
(f) All costs and expenses incurred by Participant in connection with any Drag-Along Transfer, including, without limitation, transfer taxes and legal, accounting and investment banking fees, shall be borne by Participant.
(g) Notwithstanding anything herein to the contrary, there shall be no liability on the part of the Majority Holders to Participant if a Drag-Along Transfer is not consummated for any reason, and the Majority Holders shall not be obligated to consummate the proposed Drag-Along Transfer, regardless of whether the Majority Holders have delivered a Drag-Along Notice in respect of such Proposed Drag-Along Transfer.
Drag-Along Notice Prior to making any Drag-Along Sale in which the Drag-Along Shareholders wish to exercise their rights under this Section 5, the Drag-Along Shareholders shall provide the Company and the Dragged Shareholders with written notice (the “Drag-Along Notice”) not less than thirty (30) days prior to the proposed date of closing of the Drag-Along Sale (the “Drag-Along Sale Date”). The Drag-Along Notice shall set forth: (a) the name and address of the purchasers; (b) the proposed amount and form of consideration to be paid, and the terms and conditions of payment offered by each of the purchasers; (c) the Drag-Along Sale Date; (d) the number of shares held of record by the Drag-Along Shareholders on the date of the Drag-Along Notice which form the subject to be transferred, sold or otherwise disposed of by the Drag-Along Shareholders; and (e) the number of Shares of the Dragged Shareholders to be included in the Drag-Along Sale, as applicable. In the event that the Drag-Along Sale Date does not occur within ninety (90) days after the date of the Drag-Along Notice, the shareholders of the Company shall have no obligations to sell their Shares unless they receive a new Drag-Along Notice or otherwise agree with the purchaser(s) in writing.
First Refusal Rights The Company may elect to purchase all (but -------------------- not less than all) of the shares of Executive Stock to be transferred upon the same terms and conditions as those set forth in the Sale Notice by delivering a written notice of such election to Executive and the Investors within 10 days after the Sale Notice has been delivered to the Company. If the Company has not elected to purchase all of the Executive Stock to be transferred, the Investors may elect to purchase all (but not less than all) of the Executive Stock to be transferred upon the same terms and conditions as those set forth in the Sale Notice by delivering written notice of such election to Executive within 10 days after the Sale Notice has been given to the Investors. If more than one Investor elects to purchase the Executive Stock, the shares of Executive Stock to be sold shall be allocated among the Investors pro rata according to the number of shares of Common Stock owned by each Investor on a fully-diluted basis. If neither the Company nor the Investors elect to purchase all of the shares of Executive Stock specified in the Sale Notice, Executive may transfer the shares of Executive Stock specified in the Sale Notice at a price and on terms no more favorable to the transferee(s) thereof than specified in the Sale Notice during the 60-day period immediately following the Authorization Date. Any shares of Executive Stock not transferred within such 60-day period shall be subject to the provisions of this paragraph 4(c) upon subsequent transfer. If the Company or any of the Investors have elected to purchase shares of Executive Stock hereunder, the transfer of such shares shall be consummated as soon as practical after the delivery of the election notice(s) to Executive, but in any event within 15 days after the expiration of the Election Period. The Company may pay the purchase price for such shares by offsetting amounts outstanding under the Executive Note issued to the Company hereunder and any other bona fide debts owed by Executive to the Company.
Co-Sale Rights (a) In the event any Member (for purposes of this Section 11.15, the “Selling Member”) proposes to Transfer all or any portion of its Units (for purposes of this Section 11.15, the “Co-Sale Units”) other than pursuant to a Permitted Transfer, the Selling Member shall deliver a written notice (the “Co-Sale Notice”) to each other Member (each, a “Co-Sale Offeree”) at least thirty (30) days prior to making such Transfer describing the general terms and conditions of the proposed Transfer, including the purchase price for the Co-Sale Units, the proposed purchaser(s), the closing date for the sale and the portion of the Selling Member’s Units to be Transferred (the “Co-Sale Participation Percentage”). Each Co-Sale Offeree may elect to participate in the contemplated Transfer at the same price and on the same terms and conditions by delivering written notice to the Selling Member within fifteen (15) days after delivery of the Co-Sale Notice, which notice shall specify the percentage of its Units that such Co-Sale Offeree desires to include in such proposed Transfer, provided that such percentage shall not exceed the Co-Sale Participation Percentage. If a Co-Sale Offeree does not give such notice prior to the expiration of the fifteen (15)-day period for giving such notice, then the Selling Member may Transfer the Co-Sale Units to any Person on terms and conditions that are no more favorable to the Selling Member than those set forth in the Co-Sale Notice at any time within ninety (90) days after expiration of such fifteen (15)-day period for giving notice (provided, that if any governmental or other third party approval is required with respect to such Transfer, then such period shall be extended until a reasonable time after such approvals are obtained). Any Co-Sale Units not Transferred by the Selling Member during such ninety (90)-day period (as such period may be extended pursuant to the immediately preceding sentence) shall again be subject to the provisions of this Section 11.15 prior to any subsequent Transfer.
(b) To the extent that one or more Co-Sale Offerees exercises its right of participation pursuant to Section 11.15(a), then, at the Selling Member’s option, either the percentage of Units that the Selling Member and each other participating Co-Sale Offeree may sell in the transaction shall be reduced below the applicable Co-Sale Participation Percentage to a percentage equal to the Selling Member’s or the participating Co-Sale Offeree’s (as applicable) pro rata percentage of the total Units proposed to be sold in the Transfer, or the aggregate Units to be sold in the transaction shall be increased to accommodate the Units of those participating Co-Sale Offerees pursuant to this Section 11.15.
(c) The Selling Member shall not Transfer any Co-Sale Units to any prospective transferee if such prospective transferee declines to purchase Units from participating Co-Sale Offerees, unless the Selling Member acquires from each such participating Co-Sale Offeree (on the terms set forth in the Co-Sale Notice) its pro rata percentage of the total Units proposed to be sold in the Transfer (or, if less, the percentage of its Units that such Co-Sale Offeree requested to Transfer to such transferee) on the same price, terms and conditions as would be applicable in a direct sale of such Units to the proposed transferee. The Selling Member will endeavor to facilitate the purchase by any prospective transferee of Units held by a Co-Sale Offeree which are not eligible for co-sale pursuant to this Section 11.15 if and to the extent such Co-Sale Offeree wishes to include such interests in the Transfer, but neither the Selling Member nor any other Person shall be liable if the prospective transferee declines to do so.
Continuing Rights The rights and powers of Lender hereunder shall continue and remain in full force effect until the Loan is paid in full.
