Matters Requiring Sponsor Consent. For so long as the Sponsors collectively own at least thirty percent (30%) of the then outstanding shares of Common Stock, neither the Company nor any of its subsidiaries shall take, or be permitted to take, any of the actions enumerated in this Section 4.01 (each, a “Significant Action”) without the prior written approval of each of the Sponsors. Notwithstanding the previous sentence, in the event that either Sponsor owns less than ten percent (10%) of the then outstanding shares of Common Stock, (x) the shares of Common Stock owned by such Sponsor shall be excluded from the numerator for purposes of calculating the thirty percent (30%) threshold and (y) Significant Actions shall not require the prior written approval of such Sponsor owning less than ten percent (10%) of the then outstanding Common Stock: (a) merging or consolidating with or into any other Person, or transferring all or substantially all assets of the Company and its subsidiaries, taken as a whole, to another entity, or undertaking any transaction that would constitute a Change of Control, other than, in each case, transactions among the Company and its wholly-owned subsidiaries; (b) (i) entering into any joint venture, investment (other than an investment in, contract with or acquisition of any securities or assets of any of the Company’s wholly owned subsidiaries), recapitalization, reorganization or contract with any other Person (other than a wholly owned subsidiary), (ii) the acquisition of any securities or assets of another Person (other than a wholly owned subsidiary of the Company), in the case of any of the transactions set forth in clause (i) or (ii), whether in a single transaction or series of related transactions, with a fair market value, or for a purchase price, in excess of $75.0 million, or (iii) the exercise of any ownership rights in respect of any of the foregoing in this Section 4.01(b); (c) Transferring assets of the Company or its subsidiaries in any transaction or series of related transactions (other than any Transfer of assets of any wholly owned subsidiary of the Company to the Company or any of the Company’s other wholly owned subsidiaries), in each case other than (i) inventory sold in the ordinary course of business, or (ii) any Transfer of assets in a single transaction or series of related transactions with a fair market value of less than or equal to $75.0 million; (d) guaranteeing, assuming, incurring or refinancing indebtedness for borrowed money by the Company or any of its subsidiaries (including indebtedness of any other Person existing at the time such other Person merged with or into or became a subsidiary of, or substantially all of its business and assets were acquired by, the Company or such subsidiary, and indebtedness secured by a lien encumbering any asset acquired by the Company or any such subsidiary) or the pledge of, or granting of a security interest in, any of the assets of the Company or any of its subsidiaries in excess of $100.0 million in any 12-month period (other than trade indebtedness incurred in the ordinary course of business by the Company and its subsidiaries); (e) issuing Capital Stock of the Company or the Company’s subsidiaries other than (i) issuances to the Company or any of the Company’s wholly owned subsidiaries or (ii) pursuant to an equity compensation plan approved by the Company’s stockholders or a majority of the directors on the Board designated by the Sponsors pursuant to Section 3.02; (f) terminating the employment of the Chief Executive Officer of the Company or hiring or designating a new Chief Executive Officer of the Company; (g) entering into any transactions, agreements, arrangements or payments (including the purchase, sale, lease or exchange of any property, or rendering of any service or modification or amendment of any existing agreement or arrangement) with (i) either of the Sponsors (or their Affiliates or Related Persons) (other than transactions in which a Sponsor or an Affiliate or Related Person of a Sponsor becomes a lender under a credit facility, indenture or other form of indebtedness with institutional lenders of the Company or any of its subsidiaries, including replacements or refinancings of such indebtedness), (ii) any officer, director or employee of the Company or any subsidiary of the Company (other than in the ordinary course of business as part of travel advances, relocation advances or salary) or (iii) any other Person who beneficially owns greater than or equal to ten percent (10%) of the Common Stock then outstanding (including such Person’s Affiliates), in each case that are material or involve aggregate payments or receipts in excess of $500,000; (h) amending, modifying, waiving or repealing (whether by merger, consolidation or otherwise) any provision of the certificate of incorporation, the bylaws or equivalent organizational documents of the Company or any of the Company’s subsidiaries in a manner that adversely affects either of the Sponsors; (i) commencing any liquidation, dissolution or voluntary bankruptcy, administration, recapitalization or reorganization of the Company or any of its subsidiaries in any form of transaction, making arrangements with creditors, or consenting to the entry of an order for relief in any involuntary case, or taking the conversion of an involuntary case to a voluntary case, or consenting to the appointment or taking possession by a receiver, trustee or other custodian for all or substantially all of its property, or otherwise seeking the protection of any applicable bankruptcy or insolvency law, other than any such actions with respect to a non-Material Subsidiary where, in the good faith judgment of the Board, the maintenance or preservation of such subsidiary is no longer desirable in the conduct of the business of the Company or any of its Material Subsidiaries; and (j) subject to Section 3.02, increasing or decreasing the size of the Board; and (k) entering into of any agreement to do any of the foregoing.
Appears in 2 contracts
Samples: Stockholders Agreement (AZEK Co Inc.), Stockholders Agreement (CPG Newco LLC)
Matters Requiring Sponsor Consent. For so long as the Sponsors collectively own Sponsor owns at least thirty percent (30%) of the then outstanding shares of Common Stock, neither the Company nor any of its subsidiaries shall take, or be permitted to take, any of the actions enumerated in this Section 4.01 (each, a “Significant Action”) without the prior written approval of each of the Sponsors. Notwithstanding the previous sentence, in the event that either Sponsor owns less than ten percent (10%) of the then outstanding shares of Common Stock, (x) the shares of Common Stock owned by such Sponsor shall be excluded from the numerator for purposes of calculating the thirty percent (30%) threshold and (y) Significant Actions shall not require the prior written approval of such Sponsor owning less than ten percent (10%) of the then outstanding Common Stock:Sponsor.
(a) merging or consolidating with or into any other Person, or transferring all or substantially all assets of the Company and its subsidiaries, taken as a whole, to another entity, or undertaking any transaction that would constitute a Change of Control, other than, in each case, transactions among the Company and its wholly-owned subsidiaries;
(b) (i) entering into any joint venture, investment (other than an investment in, contract with or acquisition of any securities or assets of any of the Company’s wholly owned subsidiaries), recapitalization, reorganization or contract with any other Person (other than a wholly owned subsidiary), ; (ii) the acquisition of any securities or assets of another Person (other than a wholly owned subsidiary of the Company), in the case of any of the transactions set forth in clause (i) or (ii), whether in a single transaction or series of related transactions, with a fair market value, or for a purchase price, in excess of $75.0 50.0 million, ; or (iii) the exercise of any ownership rights in respect of any of the foregoing in this Section 4.01(b);
(c) Transferring assets of the Company or its subsidiaries in any transaction or series of related transactions (other than any Transfer of assets of any wholly owned subsidiary of the Company to the Company or any of the Company’s other wholly owned subsidiaries), in each case other than than: (i) inventory sold in the ordinary course of business, ; or (ii) any Transfer of assets in a single transaction or series of related transactions with a fair market value of less than or equal to $75.0 50.0 million;
(d) guaranteeing, assuming, incurring or refinancing indebtedness for borrowed money by the Company or any of its subsidiaries (including indebtedness of any other Person existing at the time such other Person merged with or into or became a subsidiary of, or substantially all of its business and assets were acquired by, the Company or such subsidiary, and indebtedness secured by a lien encumbering any asset acquired by the Company or any such subsidiary) or the pledge of, or granting of a security interest in, any of the assets of the Company or any of its subsidiaries in excess of $100.0 million in any 12-month period (other than trade indebtedness incurred in the ordinary course of business by the Company and its subsidiaries);
(e) issuing Capital Stock of the Company or the Company’s subsidiaries other than than: (i) issuances to the Company or any of the Company’s wholly owned subsidiaries subsidiaries; or (ii) pursuant to an equity compensation plan approved by the Company’s stockholders or a majority of the directors on the Board designated by the Sponsors Sponsor pursuant to Section 3.02;
(f) terminating appointing or removing the employment of the Chief Executive Officer of the Company or hiring or designating a new Chief Executive Officer of the Company;
(g) entering into any transactions, agreements, arrangements or payments (including the purchase, sale, lease or exchange of any property, or rendering of any service or modification or amendment of any existing agreement or arrangement) with (i) either of the Sponsors (or their Affiliates or Related Persons) (other than transactions in which a Sponsor or an Affiliate or Related Person of a Sponsor becomes a lender under a credit facility, indenture or other form of indebtedness with institutional lenders of the Company or any of its subsidiaries, including replacements or refinancings of such indebtedness), (ii) any officer, director or employee of the Company or any subsidiary of the Company (other than in the ordinary course of business as part of travel advances, relocation advances or salary) ); or (iiiii) any other Person who beneficially owns greater than or equal to ten percent (10%) of the Common Stock then outstanding (including such Person’s Affiliates), in each case that are material or involve aggregate payments or receipts in excess of $500,000;
(h) amending, modifying, waiving or repealing (whether by merger, consolidation or otherwise) any provision of the certificate of incorporation, the bylaws or equivalent organizational documents of the Company or any of the Company’s subsidiaries in a manner that adversely affects either of the SponsorsSponsor;
(i) (i) commencing any liquidation, dissolution or voluntary bankruptcy, administration, recapitalization or reorganization of the Company or any of its subsidiaries in any form of transaction, (ii) making arrangements with creditors, or consenting to the entry of an order for relief in any involuntary case, or (iii) taking the conversion of an involuntary case to a voluntary case, or (iv) consenting to the appointment or taking possession by a receiver, trustee or other custodian for all or substantially all of its property, or (v) otherwise seeking the protection of any applicable bankruptcy or insolvency law, other than any such actions with respect to a non-Material Subsidiary where, in the good faith judgment of the Board, the maintenance or preservation of such subsidiary is no longer desirable in the conduct of the business of the Company or any of its Material Subsidiaries; and
(j) subject to Section 3.02, increasing or decreasing the size of the Board; and
(k) entering into of any agreement to do any of the foregoing.
Appears in 1 contract
Samples: Stockholders Agreement (Savers Value Village, Inc.)
Matters Requiring Sponsor Consent. For so long as the Sponsors collectively own Sponsor owns at least thirty percent (30%) of the then outstanding shares of Common Stock, neither the Company nor any of its subsidiaries shall take, or be permitted to take, any of the actions enumerated in this Section 4.01 (each, a “Significant Action”) without the prior written approval of each of the Sponsors. Notwithstanding the previous sentence, in the event that either Sponsor owns less than ten percent (10%) of the then outstanding shares of Common Stock, (x) the shares of Common Stock owned by such Sponsor shall be excluded from the numerator for purposes of calculating the thirty percent (30%) threshold and (y) Significant Actions shall not require the prior written approval of such Sponsor owning less than ten percent (10%) of the then outstanding Common Stock:Sponsor.
(a) merging or consolidating with or into any other Person, or transferring all or substantially all assets of the Company and its subsidiaries, taken as a whole, to another entity, or undertaking any transaction that would constitute a Change of Control, other than, in each case, transactions among the Company and its wholly-owned subsidiaries;
(b) (i) entering into any joint venture, investment (other than an investment in, contract with or acquisition of any securities or assets of any of the Company’s wholly owned subsidiaries), recapitalization, reorganization or contract with any other Person (other than a wholly owned subsidiary), ; (ii) the acquisition of any securities or assets of another Person (other than a wholly owned subsidiary of the Company), in the case of any of the transactions set forth in clause (i) or (ii), whether in a single transaction or series of related transactions, with a fair market value, or for a purchase price, in excess of $75.0 50.0 million, ; or (iii) the exercise of any ownership rights in respect of any of the foregoing in this Section 4.01(b);
(c) Transferring assets of the Company or its subsidiaries in any transaction or series of related transactions (other than any Transfer of assets of any wholly owned subsidiary of the Company to the Company or any of the Company’s other wholly owned subsidiaries), in each case other than than: (i) inventory sold in the ordinary course of business, ; or (ii) any Transfer of assets in a single transaction or series of related transactions with a fair market value of less than or equal to $75.0 50.0 million;
(d) guaranteeing, assuming, incurring or refinancing indebtedness for borrowed money by the Company or any of its subsidiaries (including indebtedness of any other Person existing at the time such other Person merged with or into or became a subsidiary of, or substantially all of its business and assets were acquired by, the Company or such subsidiary, and indebtedness secured by a lien encumbering any asset acquired by the Company or any such subsidiary) or the pledge of, or granting of a security interest in, any of the assets of the Company or any of its subsidiaries in excess of $100.0 million in any 12-month period (other than trade indebtedness incurred in the ordinary course of business by the Company and its subsidiaries);
(e) issuing Capital Stock of the Company or the Company’s subsidiaries other than than: (i) issuances to the Company or any of the Company’s wholly owned subsidiaries subsidiaries; or (ii) pursuant to an equity compensation plan approved by the Company’s stockholders or a majority of the directors on the Board designated by the Sponsors Sponsor pursuant to Section 3.02;
(f) terminating appointing or removing the employment of the Chief Executive Officer of the Company or hiring or designating a new Chief Executive Officer of the Company;
(g) entering into any transactions, agreements, arrangements or payments (including the purchase, sale, lease or exchange of any property, or rendering of any service or modification or amendment of any existing agreement or arrangement) with (i) either of the Sponsors (or their Affiliates or Related Persons) (other than transactions in which a Sponsor or an Affiliate or Related Person of a Sponsor becomes a lender under a credit facility, indenture or other form of indebtedness with institutional lenders of the Company or any of its subsidiaries, including replacements or refinancings of such indebtedness), (ii) any officer, director or employee of the Company or any subsidiary of the Company (other than in the ordinary course of business as part of travel advances, relocation advances or salary) ); or (iiiii) any other Person who beneficially owns greater than or equal to ten percent (10%) of the Common Stock then outstanding (including such Person’s Affiliates), in each case that are material or involve aggregate payments or receipts in excess of $500,000;
(h) amending, modifying, waiving or repealing (whether by merger, consolidation or otherwise) any provision of the certificate of incorporation, the bylaws or equivalent organizational documents of the Company or any of the Company’s subsidiaries in a manner that adversely affects either of the SponsorsSponsor;
(i) (i) commencing any liquidation, dissolution or voluntary bankruptcy, administration, recapitalization or reorganization of the Company or any of its subsidiaries in any form of transaction, (ii) making arrangements with creditors, or consenting to the entry of an order for relief in any involuntary case, or (iii) taking the conversion of an involuntary case to a voluntary case, or (iv) consenting to the appointment or taking possession by a receiver, trustee or other custodian for all or substantially all of its property, or (v) otherwise seeking the protection of any applicable bankruptcy or insolvency law, other than any such actions with respect to a non-Material Subsidiary where, in the good faith judgment of the Board, the maintenance or preservation of such subsidiary is no longer desirable in the conduct of the business of the Company or any of its Material Subsidiaries; and
(j) subject to Section 3.02, increasing or decreasing the size of the Board; and
(k) entering into of any agreement to do any of the foregoing.
Appears in 1 contract
Samples: Stockholders Agreement (Savers Value Village, Inc.)
Matters Requiring Sponsor Consent. For so long as Until the Sponsors collectively own at least thirty percent (30%) earlier of the then outstanding shares consummation of Common Stockan IPO and the consummation of a Change of Control, neither the Company nor Company, Holdings and IDC shall not take or commit to take, and shall not cause or allow any of its subsidiaries shall take, their respective Subsidiaries to take or be permitted commit to take, any of the following actions enumerated in this Section 4.01 (each, a “Significant Action”) without the prior written approval consent of each of the Sponsors. Notwithstanding the previous sentenceSponsor that is, in the event that either Sponsor owns less than ten percent at such time, entitled to designate at least two (10%2) of the then outstanding shares of Common Stock, (x) the shares of Common Stock owned by such Sponsor shall be excluded from the numerator for purposes of calculating the thirty percent (30%) threshold and (y) Significant Actions shall not require the prior written approval of such Sponsor owning less than ten percent (10%) of the then outstanding Common Stockdirectors pursuant to Section 3.01:
(a) merging any amendment, change, waiver, alteration or consolidating with repeal of any provision of the certificate of incorporation, by-laws or into equivalent constituent documents of the Company, Holdings or IDC (excluding (A) any increase in authorized capital stock or other equity interests available for issuance, (B) the creation of any new class or series of capital stock or other equity interests, (C) the amendments contemplated by Section 3.05 and (D) any other Personamendment, change, alteration or transferring all or substantially all assets repeal consistent with provisions of the Company and its subsidiaries, taken as a whole, to another entity, or undertaking any transaction this Agreement that would constitute a Change of Control, other than, are in each case, transactions among the Company and its wholly-owned subsidiarieseffect at such time);
(b) any dividend or distribution of any kind on any shares of capital stock or other equity interests, other than dividends or distributions (i) entering into to the Company or any joint ventureof its wholly-owned Subsidiaries or (ii) in which both Sponsors participate on a pro rata basis based on their relative ownership of shares of capital stock and other equity interests;
(c) any repurchase or redemption of equity securities from (i) employees, investment (other than upon such employees’ termination of employment pursuant to the terms of repurchase or similar agreements or arrangements, in effect from time to time, providing for the repurchase or redemption of capital stock or other equity securities at fair market value or, if such termination is for “cause” (as defined in such applicable agreements or arrangements) or in other applicable circumstances that permit the Company or its Subsidiaries to repurchase or redeem equity securities from employees, at the lesser of fair market value and the purchase price paid or ascribed to such capital stock or other equity securities upon such employees’ acquisition thereof, or (ii) either or both Sponsors, other than repurchases or redemptions in which both Sponsors participate on a pro rata basis based on their relative ownership of shares of capital stock and other equity interests;
(d) any dissolution, liquidation, bankruptcy, assignment to its creditors or wind-up of the business and affairs or any similar transaction or other action relating to an investment inentity’s insolvency, contract in each case of the Company, Holdings, IDC or any of their respective material Subsidiaries, or any consent to any of the foregoing;
(e) any transaction between or among the Company, Holdings, IDC or any of their respective Subsidiaries, on the one hand, and any director or executive officer of the Company, Holdings, IDC or any of their respective Subsidiaries, any Shareholder that beneficially owns (together with its Affiliates) more than 5% of the voting power of the Company or acquisition of any securities executive officer, director, manager, Affiliate or assets immediate family members of any of the Company’s wholly owned subsidiaries)foregoing, recapitalizationon the other hand, reorganization or contract other than (i) transactions on arms length terms with any other Person (other than portfolio company of a wholly owned subsidiary), Sponsor or its Affiliates and (ii) the acquisition of any securities or assets of another Person (other than a wholly owned subsidiary employment and compensation and benefits arrangements with an employee of the Company), in the case of Holdings, IDC or any of the transactions set forth in clause their respective Subsidiaries;
(if) or (ii), whether in a single any transaction or series of related transactions, with transactions that would constitute or cause a fair market value, Change of Control;
(g) the sale or for other disposition of stock or assets that have a purchase price, value in excess of $75.0 million, or (iii) the exercise of any ownership rights in respect of any of the foregoing in this Section 4.01(b);
(c) Transferring assets of the Company or its subsidiaries 100 million in any single transaction or series of related transactions (other than any Transfer sale or licensing of assets of any wholly owned subsidiary of the Company to the Company products or any of the Company’s other wholly owned subsidiaries), in each case other than (i) inventory sold services in the ordinary course of business), the acquisition of stock or assets for aggregate consideration with a fair market value (iias determined in good faith by the Board) in excess of $100 million in any Transfer of assets in a single transaction or series of related transactions or the entry into any joint ventures, partnerships or similar transactions that involve the contribution or participation of assets of the Company and its Subsidiaries with a fair market value (as determined in good faith by the Board) in excess of less than $100 million in any single transaction or equal to $75.0 millionseries of related transactions;
(dh) guaranteeing, assuming, incurring the entering into or refinancing indebtedness for borrowed money by development of a new line of business which will be material to the Company and its Subsidiaries taken as a whole and is unrelated to any existing line of business of the Company or any its Subsidiaries;
(i) the consummation of an IPO, other than pursuant to the exercise by either Sponsor of its subsidiaries rights under Section 3.05;
(including indebtedness j) the creation of any other Person existing at the time such other Person merged with or into or became a subsidiary of, or substantially all of its business and assets were acquired by, the Company or such subsidiary, and indebtedness secured by a lien encumbering any asset acquired by the Company or any such subsidiary) Employee Equity Arrangement or the pledge of, or granting increase in the number of a security interest in, any of the assets equity securities of the Company or any of its subsidiaries Subsidiaries reserved for issuance under any such Employee Equity Arrangement, provided that no consent shall be required if such Employee Equity Arrangement or increase permits, together with any then-existing Employee Equity Arrangements or increases, issuing only (i) options to purchase up to six percent (6%) of the then-outstanding Shares with such options having a strike price equal to or greater than the fair market value of the Shares at the time of grant, (ii) restricted stock or other awards having a fair market value at the time of grant not in excess of $100.0 million in any 12the Black-month period Scholes value of options to purchase up to six percent (6%) of the then-outstanding Shares with such options having a strike price equal to or greater than the fair market value of the Shares at such time or (iii) some combination of such options and such restricted stock and other than trade indebtedness incurred awards with a value, as determined on a pro rata basis in the ordinary course manner contemplated in clauses (i) and (ii) above, not in excess of business by the Company and its subsidiaries)either of clauses (i) or (ii) above;
(ek) issuing Capital Stock the initiation or settlement of the Company any litigation, arbitration, investigation or the Company’s subsidiaries other than administrative or similar proceeding (ieach, a “Proceeding”) issuances or series of related Proceedings reasonably expected to involve consideration payable by or to the Company or any of the Company’s wholly owned subsidiaries its Subsidiaries in excess of $50 million or (ii) pursuant to an equity compensation plan approved by the Company’s stockholders or a majority of the directors on the Board designated by the Sponsors pursuant to Section 3.02;
(f) terminating the employment of the Chief Executive Officer of the Company or hiring or designating a new Chief Executive Officer of the Company;
(g) entering into any transactions, agreements, arrangements or payments (including the purchase, sale, lease or exchange of any property, or rendering of any service or modification or amendment of any existing agreement or arrangement) with (i) either of the Sponsors (or their Affiliates or Related Persons) (other than transactions result in which a Sponsor or an Affiliate or Related Person of a Sponsor becomes a lender under a credit facility, indenture or other form of indebtedness with institutional lenders of the Company or any of its subsidiariesSubsidiaries becoming subject to a limitation on the operation of its business that is material to the Company, including replacements or refinancings of such indebtedness)its Subsidiaries, taken as a whole;
(iil) any officerincurrence, director assumption (including by way of acquisition) or employee guarantee of indebtedness for borrowed money (collectively, an “incurrence”) that would result in aggregate outstanding indebtedness for borrowed money of the Company or any subsidiary and its Subsidiaries, after giving pro forma effect to the incurrence of such indebtedness for borrowed money and the application of the Company (other than in net proceeds therefrom as if the ordinary course of business as part of travel advancesadditional indebtedness for borrowed money had been incurred, relocation advances or salary) or (iii) any other Person who beneficially owns greater than or equal to ten percent (10%) and the application of the Common Stock then outstanding net proceeds therefrom had occurred, at the beginning of the applicable twelve (including such Person’s Affiliates)12) consecutive calendar month period in which LTM EBITDA is to be calculated, in each case that are material or involve aggregate payments or receipts being in excess of $500,000;
five times (h5.0x) amendingLTM EBITDA, modifyingprovided, waiving or repealing (whether however that the foregoing limitation shall not apply to indebtedness for borrowed money incurred by merger, consolidation or otherwise) any provision of the certificate of incorporation, the bylaws or equivalent organizational documents of the Company or and its Subsidiaries that does not exceed at any of the Company’s subsidiaries in a manner that adversely affects either of the Sponsors;
(i) commencing any liquidation, dissolution or voluntary bankruptcy, administration, recapitalization or reorganization of the Company or any of its subsidiaries in any form of transaction, making arrangements with creditors, or consenting to the entry of an order for relief in any involuntary case, or taking the conversion of an involuntary case to a voluntary case, or consenting to the appointment or taking possession by a receiver, trustee or other custodian for all or substantially all of its property, or otherwise seeking the protection of any applicable bankruptcy or insolvency law, other than any such actions with respect to a non-Material Subsidiary where, in the good faith judgment of the Board, the maintenance or preservation of such subsidiary is no longer desirable in the conduct of the business of the Company or any of its Material Subsidiariesone time outstanding $100 million; and
(jm) subject The rights of each Sponsor under this Section 3.02 shall be transferable to Section 3.02, increasing or decreasing such Sponsor’s Permitted Transferees but otherwise shall not be transferable other than with the size prior written consent of the Board; and
(k) entering into of any agreement to do any of the foregoingother Sponsor.
Appears in 1 contract
