Common use of Significant Matters Clause in Contracts

Significant Matters. Notwithstanding the foregoing and any other provision contained in this Agreement to the contrary, no action shall be taken with respect to any of the matters enumerated below (each, a “Significant Matter”) without the approval of (i) the Board in accordance with Section 6.2 and (ii) during the Conservatorship, and during any period during which FHFA is acting as Receiver of one or both of the Enterprises, FHFA; provided, however, that the approval of the Board in accordance with Section 6.2 alone shall be sufficient to approve Significant Matter in the event that FHFA does not approve or deny the applicable Significant Matter in 10 Business Days from the date written notice is received by FHFA of the Significant Matter to be considered by it. All approvals and denials of Significant Matters by FHFA pursuant to this Section 6.4 shall be set forth in a written document signed by an authorized officer of FHFA or pursuant to such other procedures as may be agreed to by each Enterprise and FHFA: (a) Any amendments to or actions inconsistent with the Charter; (b) [Reserved]; (c) Amendment of this Agreement; (d) The determination of the initial Gross Asset Value of any contributions made by either Member to the Company (excluding for this purpose the initial Gross Asset Value of assets contributed to the Company under the Contribution Agreement, which the Parties agree have the initial Gross Asset Value set forth in the Contribution Agreement); (e) The declaration or amount of any dividend or distribution (other than Tax Distributions pursuant to Section 5.2(a)); (f) The purchase or other acquisition of a business or entity or the merger or consolidation of the Company with or into another entity; (g) The sale, lease, exchange, transfer or disposal of all or substantially all of the business or assets of the Company, in any one transaction or a series of related transactions; (h) A conversion of the Company from a limited liability company into a corporation or other form of entity; (i) The dissolution of the Company; (j) The admission of Additional Members, the Transfer of LLC Units by either Enterprise and the issuance of additional LLC Units or membership interests in the Company; (k) The withdrawal of capital by any Member; (l) The initiation or settlement of any significant litigation by the Company against a third party where such litigation could impact the interests, relationships or reputation of the Company; (m) The granting of any exclusive license to, or the assignment of, any Intellectual Property Rights of the Company; (n) Adoption of the Company’s Annual Plan and Budget or the Board approved Multi-Year Plan, any material amendments to the Annual Plan and Budget or approved Multi-Year Plan, aggregate expenditures that exceed the amounts set forth in the Annual Plan and Budget by more than five percent (5%), expenditures that are materially inconsistent with the allocations of expenditures set forth in the Annual Plan and Budget, or incurrence of indebtedness in excess of amounts reflected in the Annual Plan and Budget; (o) Any matter requiring approval or consultation with the U.S. Department of the Treasury under the Senior Stock Purchase Agreement between an Enterprise and the U.S. Department of the Treasury; (p) Any action that in the reasonable business judgment of the management of the Company, at the time that the action is to be taken, is likely to cause significant reputational risk to the Company or either Enterprise or result in substantial negative publicity; (q) The appointment or removal of any Officer of the Company; (r) Entering into new compensation arrangements with any Officer of the Company or increasing amounts or benefits payable to any Officer of the Company under existing compensation arrangements; (s) Entry into any contract, agreement or transaction between the Company, on the one hand, and any Enterprise or any Affiliate of any Enterprise, on the other hand, and any material amendment or waiver, or any termination or assignment, thereof, but excluding (i) certain categories of change orders (or portions thereof), statements of work (or portions thereof), amendments and waivers of such contracts, agreements or transactions solely to the extent specifically approved to not be subject to this Section 6.4(s) in accordance with the Significant Matters approval process, and (ii) any contract, agreement or transaction (and any material amendment or waiver thereof) between the Company and a third party to which an Enterprise (or an Affiliate of an Enterprise) is included as a party solely for the purpose of guaranteeing, securing or providing further assurance to the third party of the Company’s performance of, or compliance with the terms of, such contract, agreement or transaction; and (t) Any capital contributions from either of the Enterprises (except as otherwise provided for in the Budget). For the avoidance of doubt, the Deadlock resolution mechanism set forth in Section 6.2(d) shall apply with respect to the failure of the Board to be able to make a decision upon any Significant Matter in accordance with this Section 6.4; provided, however, that prior to FHFA resolving any Deadlock with respect to a Significant Matter an in-person meeting to discuss the Deadlock shall have occurred among the Chief Executive Officers of each of the Enterprises and the director of FHFA.

Significant Matters. Notwithstanding the foregoing and any other provision contained in this Agreement to the contrary, no action shall be taken with respect to any of the matters enumerated below (each, a “Significant Matter”) without the approval of (i) the Board in accordance with Section 6.2 and (ii) during the Conservatorship, and during any period during which FHFA is acting as Receiver of one or both of the Enterprises, FHFA; provided, however, that the approval of the Board in accordance with Section 6.2 alone shall be sufficient to approve Significant Matter in the event that FHFA does not approve or deny the applicable Significant Matter in 10 Business Days from the date written notice is received by FHFA of the Significant Matter to be considered by it. All approvals and denials of Significant Matters by FHFA pursuant to this Section 6.4 shall be set forth in a written document signed by an authorized officer of FHFA or pursuant to such other procedures as may be agreed to by each Enterprise and FHFA: (a) Any amendments to or actions inconsistent with the Charter; (b) [Reserved]; (c) Amendment of this Agreement; (d) The determination of the initial Gross Asset Value of any contributions made by either Member to the Company (excluding for this purpose the initial Gross Asset Value of assets contributed to the Company under the Contribution Agreement, which the Parties agree have the initial Gross Asset Value set forth in the Contribution Agreement); (e) The declaration or amount of any dividend or distribution (other than Tax Distributions pursuant to Section 5.2(a)); (f) The purchase or other acquisition of a business or entity or the merger or consolidation of the Company with or into another entity; (g) The sale, lease, exchange, transfer or disposal of all or substantially all of the business or assets of the Company, in any one transaction or a series of related transactions; (h) A conversion of the Company from a limited liability company into a corporation or other form of entity; (i) The dissolution of the Company; (j) The admission of Additional Members, the Transfer of LLC Units by either Enterprise and the issuance of additional LLC Units or membership interests in the Company; (k) The withdrawal of capital by any Member; (l) The initiation or settlement of any significant litigation by the Company against a third party where such litigation could impact the interests, relationships or reputation of the Company; (m) The granting of any exclusive license to, or the assignment of, any Intellectual Property Rights of the Company; (n) Adoption of the Company’s Annual Plan and Budget or the Board approved Multi-Year Plan, any material amendments to the Annual Plan and Budget or approved Multi-Year Plan, aggregate expenditures that exceed the amounts set forth in the Annual Plan and Budget by more than five percent (5%), expenditures that are materially inconsistent with the allocations of expenditures set forth in the Annual Plan and Budget, or incurrence of indebtedness in excess of amounts reflected in the Annual Plan and Budget; (o) Any matter requiring approval or consultation with the U.S. Department of the Treasury under the Senior Stock Purchase Agreement between an Enterprise and the U.S. Department of the Treasury; (p) Any action that in the reasonable business judgment of the management of the Company, at the time that the action is to be taken, is likely to cause significant reputational risk to the Company or either Enterprise or result in substantial negative publicity; (q) The appointment or removal of any Officer of the Company, except that FHFA approval shall only be required for appointment or removal of Officers with the title of Executive Vice President or higher; (r) Entering into new compensation arrangements with any Officer of the Company or increasing amounts or benefits payable to any Officer of the Company under existing compensation arrangements, except that FHFA approval shall only be required for compensation arrangements with Officers with the title of Executive Vice President or higher; (s) Entry into any contract, agreement or transaction between the Company, on the one hand, and any Enterprise or any Affiliate of any Enterprise, on the other hand, and any material amendment or waiver, or any termination or assignment, thereof, but excluding (i) certain categories of change orders (or portions thereof), statements of work (or portions thereof), amendments and waivers of such contracts, agreements or transactions solely to the extent specifically approved to not be subject to this Section 6.4(s) in accordance with the Significant Matters approval process, and (ii) any contract, agreement or transaction (and any material amendment or waiver thereof) between the Company and a third party to which an Enterprise (or an Affiliate of an Enterprise) is included as a party solely for the purpose of guaranteeing, securing or providing further assurance to the third party of the Company’s performance of, or compliance with the terms of, such contract, agreement or transaction; and (t) Any capital contributions from either of the Enterprises (except as otherwise provided for in the Budget). For the avoidance of doubt, the Deadlock resolution mechanism set forth in Section 6.2(d) shall apply with respect to the failure of the Board to be able to make a decision upon any Significant Matter in accordance with this Section 6.4; provided, however, that prior to FHFA resolving any Deadlock with respect to a Significant Matter an in-person meeting to discuss the Deadlock shall have occurred among the Chief Executive Officers of each of the Enterprises and the director of FHFA.

Significant Matters. Notwithstanding (a) For so long as the foregoing and any other provision contained in this Agreement Investor continues to beneficially own, whether directly or indirectly, at least the contraryMinimum Shares, no action member of the Management Group who is a director shall be taken with respect to vote in any board meetings of the Company or a Significant Subsidiary in favor of the taking of any of the matters enumerated below following actions by the Company or any Significant Subsidiaries (eachcollectively, a the “Significant MatterActions”) ), without the approval of (i) the Board in accordance with Section 6.2 and (ii) during the Conservatorship, and during any period during which FHFA is acting as Receiver of one or both prior written consent of the Enterprises, FHFAInvestor; provided, however, that for the approval avoidance of doubt, the foregoing obligation shall, in no event, require any such member of the Management Group to violate his fiduciary duties to the Company (in his capacity as a director on the Board): (A) any material change to the purpose or scope of activity of the Company or any of its Significant Subsidiaries; (B) any material changes to the constitutional documents of the Company or any of its Significant Subsidiaries (including, for purposes hereof, any material change to any of the Corporate Structure Contract); (C) the merger, consolidation or amalgamation of the Company or any of its Significant Subsidiaries with any third-party entity, or any proposal to cease to carry on the business or a substantial part of the business of the Company or any of its Significant Subsidiaries or to wind up or dissolve the Company or any of its Significant Subsidiaries or any material asset sales or dispositions outside the ordinary course of business;; (D) any changes to the size of the Board other than a change in accordance connection with Section 6.2 alone shall be sufficient to approve Significant Matter in the event that FHFA does not approve or deny the applicable Significant Matter in 10 Business Days from the date written notice is received by FHFA nomination of the Significant Matter to be considered by it. All approvals and denials of Significant Matters by FHFA a second Investor Director pursuant to this Section 6.4 shall be set forth in a written document signed by an authorized officer of FHFA or pursuant to such other procedures as may be agreed to by each Enterprise and FHFA: (a2.1(a) Any amendments to or actions inconsistent with the Charter; (b) [Reserved]; (c) Amendment of this Agreement; (dE) The determination any changes to the structure (including the number and the composition of members) of any board of directors of any Significant Subsidiary; and (F) any corporate action which materially alters the capital structure of, or rights conferred by securities issued by the Company or any of its Significant Subsidiaries, including the issuing of any equity or equity-linked securities, the granting of an option to subscribe for securities, the adjustment, split, combination, reclassification or redemption of securities, the buy-back of securities or the increase, reduction or conversion of capital (but excluding the grant or issuance of any equity or equity-linked securities pursuant to the Company’s share incentive plans that have been properly adopted and approved by the Board). (b) In furtherance of the initial Gross Asset Value foregoing, and even if, as a matter of applicable Laws or the applicable listing rules of the NYSE or the applicable Group Company’s constitutional documents, any contributions made by either Member proposed Significant Action does not require the affirmative vote or written consent of the Board, the Parties hereby acknowledge and agree that, before any Group Company proposes to take any of the foregoing Significant Actions, the Management SPVs and the Management Group shall (x) consult in good faith with the Investor on such Significant Action and (y) ensure that such Significant Action shall be duly submitted to the Board for review and approval prior to effecting such Significant Action. (c) Notwithstanding the foregoing provisions of this Section 3.1, if any member(s) of the Management Group who are on the Board reasonably believe in good faith, based upon the written advice of external legal counsel, that their compliance with the provisions of Section 3.1(a) above, in respect of the voting against any Significant Action, would violate such member’s fiduciary duty to the Company (excluding for this purpose in his capacity as a director on the initial Gross Asset Value of assets contributed to the Company under the Contribution AgreementBoard), which the Parties agree have the initial Gross Asset Value set forth then in the Contribution Agreement);such event: (eA) The declaration or amount of any dividend or distribution (other than Tax Distributions pursuant to Section 5.2(a)); (fsuch member(s) The purchase or other acquisition of a business or entity or the merger or consolidation of the Company with or into another entity; (g) The saleManagement Group shall promptly notify the Investor in writing, lease, exchange, transfer or disposal of all or substantially all including providing a copy of the business or assets of legal advice forming the Company, in any one transaction or a series of related transactions; (h) A conversion of the Company from a limited liability company into a corporation or other form of entity; (i) The dissolution of the Company; (j) The admission of Additional Members, the Transfer of LLC Units by either Enterprise and the issuance of additional LLC Units or membership interests in the Company; (k) The withdrawal of capital by any Member; (l) The initiation or settlement of any significant litigation by the Company against a third party where basis for such litigation could impact the interests, relationships or reputation of the Company; (m) The granting of any exclusive license to, or the assignment of, any Intellectual Property Rights of the Company; (n) Adoption of the Company’s Annual Plan and Budget or the Board approved Multi-Year Plan, any material amendments to the Annual Plan and Budget or approved Multi-Year Plan, aggregate expenditures that exceed the amounts set forth in the Annual Plan and Budget by more than five percent (5%), expenditures that are materially inconsistent with the allocations of expenditures set forth in the Annual Plan and Budget, or incurrence of indebtedness in excess of amounts reflected in the Annual Plan and Budget; (o) Any matter requiring approval or consultation with the U.S. Department of the Treasury under the Senior Stock Purchase Agreement between an Enterprise and the U.S. Department of the Treasury; (p) Any action that in the reasonable business judgment of the management of the Company, at the time that the action is to be taken, is likely to cause significant reputational risk to the Company or either Enterprise or result in substantial negative publicity; (q) The appointment or removal of any Officer of the Company; (r) Entering into new compensation arrangements with any Officer of the Company or increasing amounts or benefits payable to any Officer of the Company under existing compensation arrangements; (s) Entry into any contract, agreement or transaction between the Company, on the one hand, and any Enterprise or any Affiliate of any Enterprise, on the other hand, and any material amendment or waiver, or any termination or assignment, thereof, but excluding (i) certain categories of change orders (or portions thereof), statements of work (or portions thereof), amendments and waivers of such contracts, agreements or transactions solely to the extent specifically approved to not be subject to this Section 6.4(s) in accordance with the Significant Matters approval process, and (ii) any contract, agreement or transaction (and any material amendment or waiver thereof) between the Company and a third party to which an Enterprise (or an Affiliate of an Enterprise) is included as a party solely for the purpose of guaranteeing, securing or providing further assurance to the third party of the Company’s performance of, or compliance with the terms of, such contract, agreement or transactiondetermination; and (tB) Any capital contributions from either of prior to such Significant Action being submitted to the Enterprises (except as otherwise provided Board for in the Budget). For the avoidance of doubtreview and approval, the Deadlock resolution mechanism set forth in Section 6.2(d) Investor shall apply with respect be given a reasonable opportunity to review the basis for such legal advice and any other matters relevant to the failure proposed Significant Action, including retention and review by an expert or other advisor selected by the Investor, and the Company shall pay the fees and expenses of such advisor and cooperate with such advisor as reasonably requested thereby in connection with its review; and (C) at any meeting of the Board in which such Significant Matter is to be able to make a decision upon any considered, the Investor and the Management Group directors shall ensure that such Significant Matter is considered exclusively by all the “independent directors” of the Company (as defined by the NYSE listing requirements) who are not otherwise subject to a conflict of interest in accordance with this Section 6.4respect of such Significant Action; providedand (D) in the event that such Significant Action shall not be approved by a majority of the “independent directors”, however, that prior to FHFA resolving the Significant Matter shall not be approved (or any Deadlock action taken with respect to a Significant Matter an in-person meeting to discuss the Deadlock shall have occurred among the Chief Executive Officers of each of the Enterprises and the director of FHFAthereto).