Common use of Number of Investor Designees Clause in Contracts

Number of Investor Designees. As of the Closing Date, and notwithstanding anything to the contrary the Investor and SPPR agree that SPPR shall appoint to its Board of Directors, subject to the Transaction Documents (including without limitation the Purchaser Interest upon Closing), up to four (4) knowledgeable and qualified Investor Designees to the Board of Directors. The Board shall consist of no more than nine (9) members after such appointments. The continuing members of the Board of Directors will be reasonably acceptable to both the current CEO of SPPR and the Purchaser. For so long as Purchaser collectively Beneficially Owns Common Stock and Preferred Shares that would represent at least thirty-four percent (34%) of all outstanding Common Shares and Preferred Shares (the “Purchaser Interest”), then Purchaser will be entitled to appoint four (4) members to the Board of Directors. For so long as the Purchaser Interest is less than thirty-four percent (34%) but more than twenty-two percent (22%), then Purchaser will be entitled to appoint three (3) members to the Board of Directors. For so long as the Purchaser Interest is less than twenty-two percent (22%) but is equal to or more than fourteen percent (14%), then Purchaser will be entitled to appoint two (2) members to the Board of Directors. For so long as the Purchaser Interest is less than fourteen percent (14%) but is equal to or more than seven percent (7%), then Purchaser will be entitled to appoint one (1) member to the Board of Directors. The Purchaser Interest shall include the fully diluted Beneficial Ownership of the Purchaser including Common Shares and Preferred Shares but excluding Warrants. The Purchaser may remove any Investor Designee from the Board at any time, for any reason or no reason. The Purchaser may replace at any time any Investor Designee who resigns or is removed with a Qualified Replacement. In the event directors are elected by the holders of SPPR preferred stock voting separately as a class because dividends on such preferred stock are in arrears, then such directors shall replace a member or members of the Board of Directors, other than Investor Designees, as necessary to maintain the Board of Directors at no more than nine (9) members. The Purchaser will agree to vote for the election of the current directors of the SPPR Board who remain on the SPPR Board following appointment of the Investor Designees, and their successors as nominated by the Nominating Committee of the SPPR Board. At Purchaser’s option, a Investor Designee, meeting Nasdaq independence requirements, will be appointed to the Nominating Committee of the SPPR Board (provided that Investor Designees will not constitute a majority of the membership of the committee). An acquisition committee of the SPPR Board will be formed as provided in Section 2.01 of this Agreement. Such acquisition committee will have authority to approve acquisitions or dispositions of Company assets up to amounts set by the SPPR Board.