Tag Along. 9.6.1. If the Fortress Holders desire to Transfer 25% or more of their collective Class A Units in a Series (a “Class A Transfer”), or more than 50% of their collective Class C Preferred Units or Class D Preferred Units (a “Preferred Transfer”), for value to any Prospective Buyer, whether in one bona fide, arm’s length transaction or a series of related contemporaneous or contemporaneously agreed upon transactions and whether to one Prospective Buyer or more than one Prospective Buyer (a “Sale”) such Fortress Holders may only do so in the manner and on the terms set forth in this Section 9.6. Any attempted Transfer of Units subject to this Section 9.6 and not permitted by this Section 9.6 shall be null and void, and the Company and such Series shall not in any way give effect to any such impermissible Transfer. 9.6.2. A written notice (the “Tag Along Notice”) shall be furnished by the Fortress Holders to (i) in the case of a Class A Transfer, each other holder of a Class A Unit of the Series proposed to be sold, and (ii) in the case of a Preferred Transfer, each other holder of a Class C Preferred Unit or Class D Preferred Unit, as the case may be (collectively, the “Tag Along Offerors”), at least 20 business days prior to such Transfer. The Tag Along Notice shall include: (a) The principal terms of the proposed Sale insofar it relates to the Units proposed to be so sold (the “Affected Units”) including the number of Units to be purchased from the Fortress Holders, the percentage of all Affected Units held by the Fortress Holders which such number of Units proposed to be so purchased constitutes the “Tag Along Sale Percentage,” the expected per Unit purchase price (which, in the case of Class C Preferred Units or Class D Preferred Units, shall be expressed as a specified percentage of the Series 1 Class C Preferred Priority Return (in the case of Class C Preferred Units) or Series 1 Class D Preferred Priority Return (in the case of Class D Preferred Units) of the Units to be sold), the name and address of the Prospective Buyer, a good-faith estimate of the amounts described in Section 9.8.4; and (b) An invitation to each Tag Along Offeror to make an offer to include in the proposed Sale to the Prospective Buyer an additional number of Affected Units, but only including the vested portion of any Company Match Class A Units of such Series (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Tag Along Offeror) owned by such Tag Along Offeror, on the same terms and conditions with respect to each Unit sold (subject to Section 9.8), as the Fortress Holders shall Sell each of their Units. Notwithstanding the foregoing, in the event Fortress Holders are Transferring 100% of their collective economic or other rights that comprise their Series Interest in a Series in a Sale, the unvested portion of the Affected Units may be included in such proposed Sale pursuant to the terms of this Section 9.6. 9.6.3. Within 15 business days after the receipt (in accordance with Section 18.3) of the Tag Along Notice, each Tag Along Offeror desiring to make an offer to include Affected Units in the proposed Sale (each a “Participating Seller” and, together with the Fortress Holders, collectively, the “Tag Along Sellers”), shall send a written offer (the “Tag Along Offer”) to the Fortress Holders specifying the number of Units (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Participating Seller) which such Participating Seller desires to have included in the proposed Sale. Each Tag Along Offeror who does not return the Tag Along Offer within such 15 business day period shall be deemed to have waived all of such Tag Along Offeror’s rights with respect to such Sale, and the Tag Along Sellers shall thereafter be free to Sell to the Prospective Buyer, at a per Unit price no greater than 105% of the per Unit price set forth in the Tag Along Notice and on other terms which are not materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, without any further obligation to such non-accepting Tag Along Offerors. 9.6.4. The Fortress Holders shall attempt to obtain the inclusion in the proposed Sale of the entire number of Affected Units which the Tag Along Sellers desire to have included in the Sale (as evidenced in the case of the Fortress Holders by the Tag Along Notice and in the case of each Participating Seller by such Participating Seller’s Tag Along Offer). In the event the Fortress Holders shall be unable to obtain the inclusion of such entire number of Affected Units in the proposed Sale, the number of Affected Units to be sold in the proposed Sale by each Tag Along Seller shall be reduced on a pro rata basis according to the proportion which the number of all Affected Units which each such Tag Along Seller desires to have included in the Sale bears to the aggregate number of all Affected Units which all of the Tag Along Sellers desire to have included in the Sale. 9.6.5. The offer of each Participating Seller contained in such Participating Seller’s Tag Along Offer shall be irrevocable, and, to the extent such offer is accepted, such Participating Seller shall be bound and obligated to Sell in the proposed Sale on the same terms and conditions, with respect to each Affected Unit sold (subject to Section 9.8), as the Prospective Selling Holders, up to such number of Affected Units as such Participating Seller shall have specified in such Participating Seller’s Tag Along Offer; provided, however, that (a) if the principal terms of the proposed Sale change with the result that the price per Affected Unit shall be less than 95% of the price per Affected Unit set forth in the Tag Along Notice or the other terms shall be materially less favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder and (b) if, at the end of the 120th day following the date of the effectiveness of the Tag Along Notice (provided, that if the only condition, other than the making of payments or delivery of documents at such closing, to the completion of the proposed Sale is one or more regulatory or governmental approvals or consents, such 120 day period shall automatically be extended for an additional 45 days), the Fortress Holders have not completed the proposed Sale, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder, unless the failure to complete such Sale resulted from any failure by such Participating Seller to comply with the terms of this Section 9.6. 9.6.6. If, prior to consummation, the terms of the proposed Sale shall change with the result that the price per Affected Unit to be paid in such proposed Sale shall be greater than 105% of the price per Affected Unit set forth in the Tag Along Notice or the other terms of such proposed Sale shall be materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, the Tag Along Notice shall be null and void, and it shall be necessary for a separate Tag Along Notice to be furnished, and the terms and provisions of this Section 9.6 separately complied with, in order to consummate such proposed Sale pursuant to this Section 9.6. 9.6.7. Notwithstanding the foregoing provisions of this Section 9.6, no other holder of Units shall have any tag along right pursuant to the provisions of this Section 9.6 with respect to any Transfer of Units by the Fortress Holders: (a) pursuant to the exercise of their “drag along” rights contained in Section 9.7; (b) to an Affiliate of any of the Fortress Holders or to partners, members, managing directors and principals of any of the Fortress Holders that is a partnership or limited liability company; provided that such transferee shall agree to be bound by the provisions of this Section 9.6 to the same extent as if such transferee were a Fortress Holder; or (c) in a Public Sale. 9.6.8. The foregoing provisions of this Section 9.6 shall expire upon the closing of a Qualified Public Offering and shall not apply to any Units which have been Sold in a Public Sale.
Appears in 2 contracts
Sources: Limited Liability Company Agreement (Centex Land Vista Ridge Lewisville III General Partner, LLC), Limited Liability Company Agreement (Centex Land Vista Ridge Lewisville III General Partner, LLC)
Tag Along. 9.6.1. (a) If at any time any member of the Fortress Holders desire Onex Group proposes to Transfer 25% sell any Shares except for (i) sales to another member of the Onex Group that becomes bound by the terms of this Agreement (an "Onex Group Member"), (ii) sales to a Director Holder or more other management employee or director of their collective Class A Units the Corporation or a subsidiary of the Corporation, (iii) sales of the 500 Shares purchased by Onex on June 30, 1992 for later disposition to persons providing services to the Corporation or any of the Corporation's subsidiaries (the "500 Shares"), (iv) sales effected on a national securities exchange in a Series the regular way or in the over-the-counter market, or (v) sales made pursuant to an offering of securities registered under the 1933 Act (a “Class A Transfer”"Tag Along Disposition"), or more than 50% each of their collective Class C Preferred Units or Class D Preferred Units (the Director Holders shall have the right to sell to the proposed purchaser a “Preferred Transfer”)number of his Director Shares equal to the total number of his Director Shares multiplied by a ratio, for value the numerator of which is the number of Shares to any Prospective Buyer, whether in one bona fide, arm’s length transaction or a series be sold by the Onex Group Member to the proposed purchaser and the denominator of related contemporaneous or contemporaneously agreed upon transactions and whether which is the total number of Shares then owned by the Onex Group. Such ratio is referred to one Prospective Buyer or more than one Prospective Buyer (a “Sale”) such Fortress Holders may only do so in herein as the manner and on the terms set forth in this Section 9.6. Any attempted Transfer "Share Ratio." A sale of Units subject Director Shares pursuant to this Section 9.6 and not permitted by this Section 9.6 shall be null and voidmade at the same price, upon the same terms, and at the Company and such Series shall not in any way give effect to any such impermissible Transfersame time as the sale by the Onex Group Member of its Shares.
9.6.2. A written (b) The Onex Group Member shall give notice (the “"Tag Along Notice”") shall be furnished by the Fortress Holders to (i) in the case of a Class A Transfer, each other holder of a Class A Unit Director Holder of the Series proposed to be sold, and (ii) in the case of a Preferred Transfer, each other holder of a Class C Preferred Unit or Class D Preferred Unit, as the case may be (collectively, the “Tag Along Offerors”), Disposition at least 20 business days prior to such Transferthe same. The Tag Along Notice shall include:
(a) The principal be in writing and shall describe the terms of the Tag Along Disposition in reasonable detail, the identity of the proposed Sale insofar it relates purchaser, the proposed date of sale, the purchase price per Share, and the Share Ratio and shall state that (i) the Director Holder has the option to sell to the Units proposed to be so sold (the “Affected Units”) including the purchaser a number of Units Director Shares equal to be purchased from the Fortress Holders, the percentage total number of all Affected Units held Director Shares then owned by such Holder multiplied by the Fortress Holders which such number of Units proposed to be so purchased constitutes Share Ratio, (ii) the “Tag Along Sale Percentage,” the expected per Unit purchase price (whichsale, in the case of Class C Preferred Units or Class D Preferred Unitsif made, shall be expressed made at the same price per share, upon the same terms, and at the same time as the sale by the Onex Group Member of its Shares to the proposed purchaser, and (iii) the sale by Director Holders will be conditioned upon a specified percentage sale of Shares by the Series 1 Class C Preferred Priority Return (in the case of Class C Preferred Units) or Series 1 Class D Preferred Priority Return (in the case of Class D Preferred Units) of the Units Onex Group Member pursuant to be sold), the name and address of the Prospective Buyer, a good-faith estimate of the amounts described in Section 9.8.4; andthis Section.
(bc) An invitation A Director Holder may exercise his sale option pursuant to each Tag Along Offeror to make an offer to include in the proposed Sale Section 4.1 by delivering to the Prospective Buyer an additional number of Affected UnitsOnex Group Member, but only including the vested portion of any Company Match Class A Units of such Series (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Tag Along Offeror) owned by such Tag Along Offeror, on the same terms and conditions with respect to each Unit sold (subject to Section 9.8), as the Fortress Holders shall Sell each of their Units. Notwithstanding the foregoing, in the event Fortress Holders are Transferring 100% of their collective economic or other rights that comprise their Series Interest in a Series in a Sale, the unvested portion of the Affected Units may be included in such proposed Sale pursuant to the terms of this Section 9.6.
9.6.3. Within 15 business within ten days after the receipt (in accordance with Section 18.3) of such Director Holder receives the Tag Along Notice, each Tag Along Offeror desiring to make an written notice of his offer to include Affected Units in the proposed Sale (each a “Participating Seller” and, together with the Fortress Holders, collectively, the “Tag Along Sellers”), shall send a written offer (the “Tag Along Offer”) sell Director Shares pursuant to the Fortress Holders specifying this Section and indicating the number of Units (not in any event Director Shares offered for sale. If a Director Holder gives notice of his election to exceed sell, he shall be obligated to do so, but the sale and his obligation to sell shall be conditioned upon the closing of the Tag Along Sale Percentage Disposition. If the purchaser specifies a limited number of Shares that it is willing to purchase in the aggregate, each Director Holder and the Onex Group Member shall have the right to sell its or his proportion of the Affected Units number of Shares that the purchaser is purchasing, i.e., the proportion that the number of Shares owned by such Participating Seller) which such Participating Seller desires to have included in the proposed Sale. Each Tag Along Offeror who does not return the Tag Along Offer within such 15 business day period shall be deemed to have waived all of such Tag Along Offeror’s rights with respect to such Sale, and the Tag Along Sellers shall thereafter be free to Sell to the Prospective Buyer, at a per Unit price no greater than 105% of the per Unit price set forth in the Tag Along Notice and on other terms which are not materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, without any further obligation to such non-accepting Tag Along Offerors.
9.6.4. The Fortress Holders shall attempt to obtain the inclusion in the proposed Sale of the entire number of Affected Units which the Tag Along Sellers desire to have included in the Sale (as evidenced in the case of the Fortress Holders by the Tag Along Notice and in the case of each Participating Seller by such Participating Seller’s Tag Along Offer). In the event the Fortress Holders shall be unable to obtain the inclusion of such entire number of Affected Units in the proposed Sale, the number of Affected Units to be sold in the proposed Sale by each Tag Along Seller shall be reduced on a pro rata basis according to the proportion which the number of all Affected Units which each such Tag Along Seller desires to have included in the Sale Person bears to the aggregate number of all Affected Units which all of Shares owned by the Tag Along Sellers desire to have included in the Sale.
9.6.5shareholders who are selling Shares. The offer of each Participating Seller contained in such Participating Seller’s Tag Along Offer shall be irrevocable, and, to the extent such offer is accepted, such Participating Seller shall be bound and obligated to Sell in the proposed Sale on the same terms and conditions, with respect to each Affected Unit sold (subject to Section 9.8), as the Prospective Selling Holders, up to such number of Affected Units as such Participating Seller shall have specified in such Participating Seller’s Tag Along Offer; provided, however, that (a) if the principal terms of the proposed Sale change with the result that the price per Affected Unit shall be less than 95% of the price per Affected Unit set forth in the Tag Along Notice or the other terms shall be materially less favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder and (b) if, at the end of the 120th day following the date of the effectiveness of the Tag Along Notice (provided, that if the only condition, other than the making of payments or delivery of documents at such closing, to the completion of the proposed Sale is one or more regulatory or governmental approvals or consents, such 120 day period shall automatically be extended for an additional 45 days), the Fortress Holders have not completed the proposed Sale, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder, unless the failure to complete such Sale resulted from any failure by such Participating Seller to comply with the terms For purposes of this Section 9.64.1, the number of Shares owned by any Onex Group Member shall not be deemed to include any portion of the 500 Shares then owned by any Onex Group Member.
9.6.6. If, prior to consummation, the terms (d) If a transferee of the proposed Sale shall change with the result that the price per Affected Unit to be paid in such proposed Sale shall be greater than 105% of the price per Affected Unit set forth in the Tag Along Notice or the other terms of such proposed Sale shall be materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, the Tag Along Notice shall be null and void, and it shall be necessary for a separate Tag Along Notice to be furnished, and the terms and provisions of this Section 9.6 separately complied with, in order to consummate such proposed Sale Onex Shares pursuant to this Section 9.6.
9.6.7. Notwithstanding the foregoing provisions 4.1 acquires such Shares free of this Section 9.6Agreement, no other holder of Units shall have any tag along right pursuant to the provisions of this Section 9.6 with respect to any Transfer of Units by the Fortress Holders:
(a) pursuant to the exercise of their “drag along” rights contained in Section 9.7;
(b) to an Affiliate of any of the Fortress Holders or to partners, members, managing directors and principals of any of the Fortress Holders that is a partnership or limited liability company; provided that then such transferee shall agree to be bound also take the Director Shares being sold by the provisions a Director Holder free of this Section 9.6 Agreement. If, however, any Onex Group Member is required to transfer any Onex Shares subject to this Agreement, then the same extent as if such transferee were a Fortress Holder; or
(c) in a Public SaleDirector Holder shall also transfer his Director Shares subject to this Agreement.
9.6.8. The foregoing provisions of this Section 9.6 shall expire upon the closing of a Qualified Public Offering and shall not apply to any Units which have been Sold in a Public Sale.
Appears in 2 contracts
Sources: Director Shareholders Agreement (Prosource Inc), Director Shareholders Agreement (Prosource Inc)
Tag Along. 9.6.1. If In the Fortress Holders desire to Transfer 25% event that Holdco 1 or more any Affiliate of their collective Class A Units in a Series Holdco 1 (a “Class A Transfer”), or more than 50% of their collective Class C Preferred Units or Class D Preferred Units (a “Preferred Transfer”), for value to any Prospective Buyer, whether in one bona fide, arm’s length transaction or a series of related contemporaneous or contemporaneously agreed upon transactions and whether to one Prospective Buyer or more than one Prospective Buyer (a “Sale”) such Fortress Holders may only do so in the manner and on the terms set forth in this Section 9.6. Any attempted Transfer of Units subject to this Section 9.6 and not permitted by this Section 9.6 shall be null and void, and the Company and such Series shall not in any way give effect to any such impermissible Transfer.
9.6.2. A written notice (the “Tag Along Notice”) shall be furnished by the Fortress Holders to (i) in the case of a Class A Transfer, each other holder of a Class A Unit of the Series proposed to be sold, and (ii) in the case of a Preferred Transfer, each other holder of a Class C Preferred Unit or Class D Preferred Unit, as the case may be be, a "Transferor") proposes to Sell any of the Units owned by it to any Person other than Holdco 1 or an Affiliate of Holdco 1 (collectively, the “Tag Along Offerors”a "Proposed Purchaser"), at least 20 business days prior to then the Transferor will promptly provide each Minority Investor written notice (a "Sale Notice") of such Transfer. The Tag Along Notice shall include:
proposed Sale (aa "Proposed Sale") The principal and the material terms of the proposed Proposed Sale insofar it relates to as of the Units proposed to be so sold (the “Affected Units”) date of such Sale Notice, including the aggregate number of Units the Proposed Purchaser is willing to be purchased from purchase. If within ten (10) business days of the Fortress Holdersreceipt of the Sale Notice, the percentage Transferor receives a written request (a "Sale Request") to include the Units held, directly or indirectly, by any Minority Investor in the Proposed Sale, such Minority Investor shall have the right to Sell, at the same price, on the same terms and pursuant to the same conditions as the Proposed Sale, up to such number of all Affected Units held by as shall equal the Fortress Holders which such aggregate number of Units proposed to be so purchased constitutes the “Tag Along Sale Percentage,” the expected per Unit purchase price (which, Sold in the case of Class C Preferred Units or Class D Preferred Units, shall be expressed as such transaction multiplied by a specified percentage of the Series 1 Class C Preferred Priority Return (in the case of Class C Preferred Units) or Series 1 Class D Preferred Priority Return (in the case of Class D Preferred Units) of the Units to be sold)fraction, the name and address numerator of which is the Prospective Buyer, a good-faith estimate of the amounts described in Section 9.8.4; and
(b) An invitation to each Tag Along Offeror to make an offer to include in the proposed Sale to the Prospective Buyer an additional aggregate number of Affected Units, but only including the vested portion of any Company Match Class A Units of such Series (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Tag Along Offeror) Minority Investor and the denominator of which is the aggregate number of Units owned by the Transferor and its Affiliates and all other Members participating in such Tag Along Offerortransaction. If a Minority Investor wishes to Sell a number of Units which is less than its share as determined pursuant to the preceding sentence, on the maximum number of Units such Minority Investor wishes to Sell must be explicitly set forth in the Sale Request. If any such Minority Investor has not accepted the offer contained in the Sale Notice by delivering the Sale Request to the Transferor in the required time, such Minority Investor shall be deemed to have irrevocably waived its rights under this Section 7.7(a) with respect to such Proposed Sale, and the Transferor shall thereafter be free, for a period of one hundred and eighty (180) days from the date of the Sale Notice, to transfer the Units specified in the Sale Notice upon the same terms and conditions with respect to each Unit sold (subject to Section 9.8), as the Fortress Holders shall Sell each of their Units. Notwithstanding the foregoing, set forth in the event Fortress Holders are Transferring 100% of their collective economic or Sale Notice (other rights that comprise their Series Interest in a Series in a Salethan the price, the unvested portion of the Affected Units which may be included in such proposed higher). Any Sale pursuant to the terms of this Section 9.6.
9.6.3. Within 15 business days after the receipt (in accordance with Section 18.3) of the Tag Along Notice, each Tag Along Offeror desiring to make an offer to include Affected Units in the proposed Sale (each a “Participating Seller” and, together with the Fortress Holders, collectively, the “Tag Along Sellers”), shall send a written offer (the “Tag Along Offer”) to the Fortress Holders specifying the number of Units (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Participating Seller) which such Participating Seller desires to have included in the proposed Sale. Each Tag Along Offeror who does not return the Tag Along Offer within such 15 business day period Request shall be deemed to have waived all of such Tag Along Offeror’s rights with respect to such Saleirrevocable, and once received by the Tag Along Sellers Transferor, such Minority Investor shall thereafter be free obligated to Sell to the Prospective Buyer, at a per Unit price no greater than 105% of the per Unit price set forth Proposed Purchaser such Minority Investor's Units in the Tag Along Notice and on other terms which are not materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, without any further obligation to such non-accepting Tag Along Offerors.
9.6.4. The Fortress Holders shall attempt to obtain the inclusion in the proposed Sale of the entire number of Affected Units which the Tag Along Sellers desire to have included in the Sale (as evidenced in the case of the Fortress Holders by the Tag Along Notice and in the case of each Participating Seller by such Participating Seller’s Tag Along Offeraccordance with this Section 7.7(a). In connection with the event delivery of the Fortress Holders Sale Request, a Minority Investor shall be unable deliver to obtain the inclusion of such entire number of Affected Units in Transferor the proposed Sale, certificates for the number of Affected Units to be sold by it in connection with the proposed Sale by each Tag Along Seller shall be reduced on Proposed Sale. If a pro rata basis according Minority Investor should fail to deliver such certificates to the proportion which the number of all Affected Units which each such Tag Along Seller desires to have included in the Sale bears to the aggregate number of all Affected Units which all of the Tag Along Sellers desire to have included in the Sale.
9.6.5. The offer of each Participating Seller contained in such Participating Seller’s Tag Along Offer shall be irrevocable, and, to the extent such offer is accepted, such Participating Seller shall be bound and obligated to Sell in the proposed Sale on the same terms and conditions, with respect to each Affected Unit sold (subject to Section 9.8), as the Prospective Selling Holders, up to such number of Affected Units as such Participating Seller shall have specified in such Participating Seller’s Tag Along Offer; provided, however, that (a) if the principal terms of the proposed Sale change with the result that the price per Affected Unit shall be less than 95% of the price per Affected Unit set forth in the Tag Along Notice or the other terms shall be materially less favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder and (b) if, at the end of the 120th day following the date of the effectiveness of the Tag Along Notice (provided, that if the only condition, other than the making of payments or delivery of documents at such closing, to the completion of the proposed Sale is one or more regulatory or governmental approvals or consents, such 120 day period shall automatically be extended for an additional 45 days)Transferor, the Fortress Holders have not completed the proposed Sale, each Participating Seller Company shall be permitted cause its books and records to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder, unless the failure to complete such Sale resulted from any failure by such Participating Seller to comply with the terms of this Section 9.6.
9.6.6. If, prior to consummation, the terms of the proposed Sale shall change with the result that the price per Affected Unit to be paid in such proposed Sale shall be greater than 105% of the price per Affected Unit set forth in the Tag Along Notice or the other terms of such proposed Sale shall be materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, the Tag Along Notice shall be null and void, and it shall be necessary for a separate Tag Along Notice to be furnished, and the terms and provisions of this Section 9.6 separately complied with, in order to consummate such proposed Sale pursuant to this Section 9.6.
9.6.7. Notwithstanding the foregoing provisions of this Section 9.6, no other holder of Units shall have any tag along right pursuant to the provisions of this Section 9.6 with respect to any Transfer of Units by the Fortress Holders:
(a) pursuant to the exercise of their “drag along” rights contained in Section 9.7;
(b) to an Affiliate of any of the Fortress Holders or to partners, members, managing directors and principals of any of the Fortress Holders that is a partnership or limited liability company; provided show that such transferee shall agree to be Units are bound by the provisions of this Section 9.6 7.7(a) and that such Units shall be transferred to the transferee identified in the Sale Notice immediately upon surrender for transfer by such holder. The Transferor shall not consummate any Proposed Sale without compliance with this Section 7.7(a), and the Company shall not recognize or give effect to any purported transfer of Units not made in compliance with this Section 7.7(a). Units subject to a Sale Request will be included in a Proposed Sale pursuant hereto and to any agreement with the Proposed Purchaser relating thereto, on the same terms and subject to the same extent as if such transferee were a Fortress Holderconditions applicable to the Units which the Transferor proposes to sell in the Proposed Sale. Such terms and conditions shall include, without limitation, (i) the Sale consideration and (ii) the provision of information, representations, warranties, covenants and requisite indemnifications; or
(c) in a Public Sale.
9.6.8. The foregoing provisions of this Section 9.6 shall expire upon the closing of a Qualified Public Offering provided, however, that any representations and shall not apply warranties relating specifically to any Member shall only be made by that Member and any indemnification provided by the Members shall be based on the number of Units which have been being Sold by each Member in the Proposed Sale, either on a Public Saleseveral, not joint, basis or solely with recourse to an escrow established for the benefit of the Proposed Purchaser. In addition, each participating Minority Investor and the Transferor shall bear its proportionate share (based on consideration received) of the out-of-pocket costs and expenses incurred in connection with any such transaction.
Appears in 1 contract
Sources: Limited Liability Company Agreement (Huntsman Advanced Materials (UK) LTD)
Tag Along. 9.6.1. If No Member or group of Members (collectively, the Fortress Holders desire to Transfer 25% “Triggering Holders”) shall directly or more indirectly (including by way of their collective Class A a transfer of capital stock or other equity securities of a holder of Units) transfer Units in a Series (a “Class A Transfer”), or more than 50% of their collective Class C Preferred Units or Class D Preferred Units (a “Preferred Transfer”), for value to any Prospective Buyer, whether in one bona fide, arm’s length transaction or a series of related contemporaneous or contemporaneously agreed upon transactions and whether to one Prospective Buyer or more than one Prospective Buyer (a “Sale”) such Fortress Holders may only do so to any other Person, who is not an Affiliate (each a “Prospective Buyer”) except in the manner and on the terms set forth in this Section 9.6. Any attempted Transfer of Units subject to this Section 9.6 and not permitted by this Section 9.6 shall be null and void, and the Company and such Series shall not in any way give effect to any such impermissible TransferSection.
9.6.2. (a) A written notice (the “Tag Along Notice”) shall be furnished by the Fortress Triggering Holders to (i) in the case of a Class A Transfer, each other holder of a Class A Unit of the Series proposed to be sold, and (ii) in the case of a Preferred Transfer, each other holder of a Class C Preferred Unit or Class D Preferred Unit, as the case may be (collectively, the “Tag Along Offerors”), Member at least 20 business days prior to such Transfertransfer. The Tag Along Notice shall include:
(ai) The principal terms of the proposed Sale insofar it relates to Sale, including (A) the Units proposed to be so sold (the “Affected Units”) including the number amount of Units to be purchased from sold by the Fortress Triggering Holders, (B) the percentage of all Affected the Units held by the Fortress Holders Triggering Members which such number of Units proposed to be so purchased constitutes (the “Tag Along Sale Percentage,” ”), (C) the expected per Unit purchase price (which, in respect of the case of Class C Preferred Units or Class D Preferred Units, shall be expressed as a specified percentage of the Series 1 Class C Preferred Priority Return and (in the case of Class C Preferred UnitsD) or Series 1 Class D Preferred Priority Return (in the case of Class D Preferred Units) of the Units to be sold), the name and address of the Prospective Buyer, a good-faith estimate of the amounts described in Section 9.8.4; and
(bii) An invitation to each Tag Along Offeror to make an offer other Member to include in the proposed Sale to the Prospective Buyer an additional number of Affected Units, but only including the vested portion of any Company Match Class A Units of such Series (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Tag Along OfferorMember) owned by such Tag Along OfferorMember, on the same terms and conditions with respect to each Unit sold (subject to Section 9.8), as the Fortress Triggering Holders shall Sell sell each of their Units. Notwithstanding the foregoing, in the event Fortress Holders are Transferring 100% of their collective economic or other rights that comprise their Series Interest in a Series in a Sale, the unvested portion of the Affected Units may be included in such proposed Sale pursuant to the terms of this Section 9.6.
9.6.3. (b) Within 15 business days after the receipt (in accordance with Section 18.3) of the Tag Along Notice, each Tag Along Offeror Member desiring to make an offer to include Affected Units in the proposed Sale (each a “Participating Seller” and, together with the Fortress Triggering Holders, collectively, the “Tag Along Sellers”), ) shall send a written offer election (the “Tag Along OfferElection”) to the Fortress Triggering Holders specifying the number of Units (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned held by such Participating Seller) which that such Participating Seller desires to have included include in the proposed Sale. Each Tag Along Offeror who does not return the Tag Along Offer within such 15 business day period shall be deemed to have waived all An election of such Tag Along Offeror’s rights with respect to such Sale, and the Tag Along Sellers shall thereafter be free to Sell to the Prospective Buyer, at a per Unit price no greater than 105% of the per Unit price set forth in the Tag Along Notice and on other terms which are not materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, without any further obligation to such non-accepting Tag Along Offerors.
9.6.4. The Fortress Holders shall attempt to obtain the inclusion in the proposed Sale of the entire number of Affected Units which the Tag Along Sellers desire to have included in the Sale (as evidenced in the case of the Fortress Holders by the Tag Along Notice and in the case of each Participating Seller by such Participating Seller’s Tag Along Offer). In the event the Fortress Holders shall be unable pursuant to obtain the inclusion of such entire number of Affected Units in the proposed Sale, the number of Affected Units to be sold in the proposed Sale by each Tag Along Seller shall be reduced on a pro rata basis according to the proportion which the number of all Affected Units which each such Tag Along Seller desires to have included in the Sale bears to the aggregate number of all Affected Units which all of the Tag Along Sellers desire to have included in the Sale.
9.6.5. The offer of each Participating Seller contained in such Participating Seller’s Tag Along Offer this Section shall be irrevocable, and, to the extent such offer is accepted, and such Participating Seller shall be bound and obligated to Sell sell in the proposed Sale on the same terms and conditions, with respect to each Affected Unit sold (subject to Section 9.8)the Units sold, as the Prospective Selling Triggering Holders, up to such number of Affected Units as such Participating Seller shall have specified in such Participating Seller’s Tag Along OfferElection; provided, however, that (ai) if the principal terms of the proposed Sale change with the result such that the price per Affected Unit shall be less than 95% of the price per Affected Unit set forth in the Tag Along Notice or the other terms shall be they are materially less favorable in the aggregate to the Tag Along Sellers than those set forth in the Tag Along Notice, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder and (bii) if, at the end of the 120th day following the date of the effectiveness of the Tag Along Notice (providedNotice, that if the only condition, other than the making of payments or delivery of documents at such closing, to the completion of the proposed Sale is one or more regulatory or governmental approvals or consents, such 120 day period shall automatically be extended for an additional 45 days), the Fortress Holders have has not completed the proposed Salebeen completed, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s its obligations thereunder, unless the failure with respect to complete such Sale resulted from any failure by such Participating Seller to comply with the terms of this Section 9.6.
9.6.6. If, prior to consummation, the terms of the proposed Sale shall change with the result that the price per Affected Unit to be paid in such proposed Sale shall be greater than 105% of the price per Affected Unit set forth in the Tag Along Notice or the other terms of such proposed Sale shall be materially more favorable to the Tag Along Sellers than those set forth in the Tag Along NoticeSale, the Tag Along Notice shall be null and void, and it shall be necessary for a separate Tag Along Notice to be furnished, and the terms and provisions of this Section 9.6 separately complied with, in order to consummate such proposed Sale. Each Member who does not so elect to include Units in the proposed Sale pursuant shall be deemed to this Section 9.6.
9.6.7. Notwithstanding the foregoing provisions of this Section 9.6, no other holder of Units shall have any tag along right pursuant to the provisions of this Section 9.6 waived all rights with respect to any Transfer of Units by the Fortress Holders:
(a) pursuant to the exercise of their “drag along” rights contained in Section 9.7;
(b) to an Affiliate of any of the Fortress Holders or to partners, members, managing directors and principals of any of the Fortress Holders that is a partnership or limited liability company; provided that such transferee shall agree to be bound by the provisions of this Section 9.6 to the same extent as if such transferee were a Fortress Holder; orSale.
(c) The Triggering Holders shall attempt to obtain the inclusion in a Public Sale.
9.6.8. The foregoing provisions the proposed Sale of this Section 9.6 shall expire upon the closing entire number of a Qualified Public Offering and shall not apply to any Units which the Tag Along Sellers desire to have been Sold included in the Sale. In the event the Triggering Holders shall be unable to obtain the inclusion of such entire number of Units in the proposed Sale, the total number of Units to be sold in the proposed Sale shall be allocated among the Triggering Holders and the Tag Along Sellers on a Public Salepro rata basis according to the number of Units held by each.
Appears in 1 contract
Sources: Operating Agreement (Prospect Global Resources Inc.)
Tag Along. 9.6.1. If (a) Subject to first complying with the Fortress Holders desire right of first refusal set forth in Section 8.02, in the event that any Class A Unitholder (a “Tag Selling Unitholder”) desires to Transfer 25% or more any Class A Units, pursuant to a bona fide offer from any Person (other than an Affiliate of their collective any Tag Selling Unitholder) (a “Buyer”), then such Tag Selling Unitholder shall notify the Class A Unitholders, to the extent such are not Tag Selling Unitholders (“Tag-Along Unitholders”), in writing, of such offer and its terms and conditions, including, without limitation, the number of Class A Units in a Series subject to the proposed Transfer, the sales price (a the “Class A TransferOffer Price”), or more than 50% form of their collective Class C Preferred Units or Class D Preferred Units (a “Preferred Transfer”), for value to any Prospective Buyer, whether in one bona fide, arm’s length transaction or a series of related contemporaneous or contemporaneously agreed upon transactions consideration and whether to one Prospective Buyer or more than one Prospective Buyer (a “Sale”) such Fortress Holders may only do so in the manner and on the terms set forth in this Section 9.6. Any attempted proposed Transfer of Units subject to this Section 9.6 and not permitted by this Section 9.6 shall be null and void, and the Company and such Series shall not in any way give effect to any such impermissible Transfer.
9.6.2. A written notice date (the “Tag Along Transfer Notice”) shall be furnished by the Fortress Holders to (i) in the case ). Upon receipt of a Class A Transfersuch Tag Transfer Notice, each other holder of a Class A Unit of Tag-Along Unitholder shall have the Series proposed right to be sold, and (ii) in the case of a Preferred Transfer, each other holder of a Class C Preferred Unit or Class D Preferred Unit, as the case may be (collectively, the “Tag Along Offerors”), at least 20 business days prior to such Transfer. The Tag Along Notice shall include:
(a) The principal terms of the proposed Sale insofar it relates sell to the Units proposed to be so sold (the “Affected Units”) including the number of Units to be purchased from the Fortress Holders, the percentage of all Affected Units held by the Fortress Holders which such number of Units proposed to be so purchased constitutes the “Tag Along Sale Percentage,” the expected per Unit purchase price (which, in the case of Class C Preferred Units or Class D Preferred Units, shall be expressed as a specified percentage of the Series 1 Class C Preferred Priority Return (in the case of Class C Preferred Units) or Series 1 Class D Preferred Priority Return (in the case of Class D Preferred Units) of the Units to be sold), the name and address of the Prospective Buyer, a good-faith estimate of the amounts described in Section 9.8.4; and
(b) An invitation to each Tag Along Offeror to make an offer to include in the proposed Sale to the Prospective Buyer an additional number of Affected Units, but only including the vested portion of any Company Match Class A Units of such Series (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Tag Along Offeror) owned by such Tag Along Offeror, on the same terms and conditions with respect to each Unit sold (subject to Section 9.8), as the Fortress Holders shall Sell Tag Selling Unitholder as set forth in the Tag Transfer Notice, that number of Units equal to the product attained by multiplying (a) the number of Class A Units beneficially owned by the Tag-Along Unitholder and (b) the quotient derived by dividing (i) the number of Class A Units which otherwise would have been sold by the Tag Selling Unitholders to the Buyer by (ii) the total number of Class A Units Beneficially Owned by such Tag Selling Unitholder and the number of Class A Units Beneficially Owned by the Tag-Along Unitholders who have elected to participate in such Transfer. If more than one Tag-Along Unitholder elects to Transfer Class A Units pursuant to this Section 8.03, they may do so pro rata based on the number of Class A Units beneficially owned by each of their Units. Notwithstanding the foregoing, in the event Fortress Holders are Transferring 100% of their collective economic them or other rights that comprise their Series Interest in a Series in a Sale, the unvested portion of the Affected Units may be included in such proposed Sale pursuant to other proportions as they may agree. To the terms extent one or more Tag-Along Unitholders exercise such right of this Section 9.6.
9.6.3. Within 15 business days after the receipt (participation in accordance with the terms and conditions set forth herein, the number of Class A Units that the Tag Selling Unitholder may Transfer shall be correspondingly reduced. The Tag-Along Unitholders’ right to sell pursuant to this Section 18.38.03 can be exercised by delivery of written notice to the Tag Selling Unitholder within ten (10) Business Days following delivery of the Tag Transfer Notice. Any Tag-Along Notice, each Tag Along Offeror desiring Unitholder who fails to make an offer to include Affected Units in the proposed Sale (each a “Participating Seller” and, together with the Fortress Holders, collectively, the “Tag Along Sellers”), shall send a written offer (the “Tag Along Offer”) to the Fortress Holders specifying the number of Units (not in any event to exceed notify the Tag Along Sale Percentage of the Affected Units owned by such Participating Seller) which such Participating Seller desires to have included in the proposed Sale. Each Tag Along Offeror who does not return the Tag Along Offer Selling Unitholder within such 15 business day period ten (10) Business Days shall be deemed to have waived all of such Tag Along Offeror’s its rights with respect to such Sale, and the Tag Along Sellers shall thereafter be free to Sell to the Prospective Buyer, at a per Unit price no greater than 105% of the per Unit price set forth in the Tag Along Notice and on other terms which are not materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, without any further obligation to such non-accepting Tag Along Offerorsunder this Section 8.03.
9.6.4. The Fortress Holders shall attempt to obtain the inclusion in the proposed Sale of the entire number of Affected Units which the Tag Along Sellers desire to have included in the Sale (as evidenced in the case of the Fortress Holders by the Tag Along Notice and in the case of each Participating Seller by such Participating Seller’s Tag Along Offer). b) In the event the Fortress Holders shall be unable that Class A Unitholders propose to obtain the inclusion of such entire number of Affected Transfer Class A Units in the proposed Saleone or more related transactions, the number result of Affected Units which would be a Change of Control, the Class B Unitholders shall have the same Tag-Along rights to be sold in the proposed Sale by each Tag Along Seller shall be reduced on a pro rata basis according to the proportion which the number of all Affected Units which each such Tag Along Seller desires to have included in the Sale bears to the aggregate number of all Affected Units which all of the Tag Along Sellers desire to have included in the Sale.
9.6.5. The offer of each Participating Seller contained participate in such Participating Seller’s Tag Along Offer shall be irrevocable, and, to Transfer as provided for in Section 8.03(a) for the extent such offer is accepted, such Participating Seller shall be bound and obligated to Sell in the proposed Sale on the same terms and conditions, with respect to each Affected Unit sold (subject to Section 9.8), as the Prospective Selling Holders, up to such number of Affected Units as such Participating Seller shall have specified in such Participating Seller’s Tag Along OfferClass A Unitholders; provided, however, that (a) if the principal terms of the proposed Sale change with the result that the price per Affected Unit shall be less than 95% of the price per Affected Unit Offer Price set forth in the Tag Along Transfer Notice or the other terms shall be materially less favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder and (b) if, at the end of the 120th day following the date of the effectiveness of the Tag Along Notice (provided, that if the only condition, other than the making of payments or delivery of documents at such closing, to the completion of the proposed Sale is one or more regulatory or governmental approvals or consents, such 120 day period shall automatically be extended for an additional 45 days), the Fortress Holders have not completed the proposed Sale, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder, unless the failure to complete such Sale resulted from any failure by such Participating Seller to comply with the terms of this Section 9.6.
9.6.6. If, prior to consummation, the terms of the proposed Sale shall change with the result that the price per Affected Unit to be paid in such proposed Sale shall be greater than 105% of the price per Affected Unit set forth in the Tag Along Notice or the other terms of such proposed Sale shall be materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, the Tag Along Notice shall be null and void, and it shall be necessary for a separate Tag Along Notice to be furnished, and the terms and provisions of this Section 9.6 separately complied with, in order to consummate such proposed Sale pursuant to this Section 9.6.
9.6.7. Notwithstanding the foregoing provisions of this Section 9.6, no other holder of Units shall have any tag along right pursuant to the provisions of this Section 9.6 with respect to any Transfer the Class B Units shall be appropriately adjusted based on the liquidation value of Units by a Class B Unit in a liquidation in which a Class A Unit were to receive the Fortress Holders:
(a) pursuant to the exercise of their “drag along” rights contained Offer Price provided for in Section 9.7;
(b) to an Affiliate of any of the Fortress Holders or to partners, members, managing directors and principals of any of the Fortress Holders that is a partnership or limited liability company; provided that such transferee shall agree to be bound by the provisions of this Section 9.6 to the same extent as if such transferee were a Fortress Holder; or
(c) in a Public Sale8.03(a).
9.6.8. The foregoing provisions of this Section 9.6 shall expire upon the closing of a Qualified Public Offering and shall not apply to any Units which have been Sold in a Public Sale.
Appears in 1 contract
Sources: Limited Liability Company Agreement (Mill Road Capital, L.P.)
Tag Along. 9.6.1. If the Fortress Holders desire to Transfer 25% or more of their collective Class A Units in a Series (a) No Stockholder (each such Stockholder, a “Class A TransferProspective Selling Holder”), or more than 50% of their collective Class C Preferred Units or Class D Preferred Units (a “Preferred Transfer”), ) shall Transfer any Share for value to any Prospective Buyer, whether in one bona fide, arm’s length transaction or a series of related contemporaneous or contemporaneously agreed upon transactions and whether to one Prospective Buyer or more than one Prospective Buyer (a “Sale”, or any similar formulation of the verb “Sell”) such Fortress Holders may only do so to any Prospective Buyer except in the manner and on the terms set forth in this Section 9.62.4. Any attempted Transfer of Units subject to Shares not in compliance with this Section 9.6 and not permitted by this Section 9.6 2.4 shall be null and void, and the Company and such Series shall not in any way give effect to any such impermissible Transfer.
9.6.2. (b) A written notice (the “Tag Along Notice”) shall be furnished by the Fortress Prospective Selling Holders to (i) in the case of a Class A Transfer, each other holder of a Class A Unit of the Series proposed to be sold, and (ii) in the case of a Preferred Transfer, each other holder of a Class C Preferred Unit or Class D Preferred Unit, as the case may be Eligible Stockholder (collectively, the “Tag Along Offerors”), ) at least 20 business days ten (10) Business Days prior to such Transfer. The Tag Along Notice shall include:
: (ai) The principal terms of the proposed Sale insofar it relates to the Units proposed to be so sold (the “Affected Units”) Sale, including the number and class or series of Units Shares to be purchased from the Fortress Prospective Selling Holders, the percentage of all Affected Units Shares held by the Fortress Holders Prospective Selling Holder which such number of Units Shares proposed to be so purchased constitutes (the “Tag Along Sale Percentage,” ”), the expected per Unit Share purchase price (which, in the case of Class C Preferred Units or Class D Preferred Units, shall be expressed as a specified percentage of the Series 1 Class C Preferred Priority Return (in the case of Class C Preferred Units) or Series 1 Class D Preferred Priority Return (in the case of Class D Preferred Units) of the Units to be soldreceived by the Prospective Selling Holders (as calculated on an as converted basis), the name and address of the Prospective Buyer, Buyer and a good-faith estimate of the amounts described in Section 9.8.42.6(e); and
and (bii) An invitation to each Tag Along Offeror to make an offer to include in the proposed Sale to the Prospective Buyer an additional number of Affected Units, but only including the vested portion Shares of any Company Match Class A Units of such Series each class or series (not in any event to exceed the Tag Along Sale Percentage of the Affected Units Shares of such class or series owned by such Tag Along Offeror) owned by such Tag Along Offeror, for a price per Share of such class or series equal to the price per Share (as calculated on an as-converted basis) the Prospective Selling Holder will receive in such Sale and otherwise on the same terms and conditions with respect to each Unit Share sold (subject to Section 9.82.6), as the Fortress Prospective Selling Holders shall Sell each of their Units. Notwithstanding the foregoing, in the event Fortress Holders are Transferring 100% of their collective economic or other rights that comprise their Series Interest in a Series in a Sale, the unvested portion of the Affected Units may be included in such proposed Sale pursuant to the terms of this Section 9.6Shares.
9.6.3. (c) Within 15 business days ten (10) Business Days after the receipt (in accordance with Section 18.3) delivery of the Tag Along Notice, each Tag Along Offeror desiring to make an offer to include Affected Units Shares in the proposed Sale (each a “Participating Seller” and, together with the Fortress Prospective Selling Holders, collectively, the “Tag Along Sellers”), ) shall send a written offer (the “Tag Along Offer”) to the Fortress Prospective Selling Holders specifying the number of Units Shares (not in any event to exceed the Tag Along Sale Percentage of the Affected Units Shares owned by such Participating Seller) which such Participating Seller desires to have included in the proposed Sale. Each Tag Along Offeror who does not return so accept the Tag Along Offer within such 15 business day period Prospective Selling Holders’ invitation to make an offer to include Shares in the proposed Sale shall be deemed to have waived all of such Tag Along Offeror’s rights with respect to such Sale, and the Tag Along Sellers shall thereafter be free to Sell to the Prospective Buyer, at a per Unit price no greater than 105% of the per Unit price set forth in the Tag Along Notice and Buyer on other terms which are not materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, without any further obligation to such non-accepting Tag Along Offerors.
9.6.4. (d) The Fortress Prospective Selling Holders shall attempt use their reasonable efforts to obtain the inclusion in the proposed Sale of the entire number of Affected Units Shares which the Tag Along Sellers desire to have included in the Sale (as evidenced in the case of the Fortress Prospective Selling Holders by the Tag Along Notice and in the case of each Participating Seller by such Participating Seller’s Tag Along Offer). In the event the Fortress Prospective Selling Holders shall be unable to obtain the inclusion of such entire number of Affected Units Shares in the proposed Sale, the number of Affected Units Shares to be sold in the proposed Sale by each Tag Along Seller shall be reduced on a pro rata basis according to the proportion which the number of all Affected Units Shares which each such Tag Along Seller desires to have included in the Sale bears to the aggregate number of all Affected Units Shares which all of the Tag Along Sellers desire to have included in the Sale.
9.6.5. (e) The offer of each Participating Seller contained in such Participating Seller’s Tag Along Offer shall be irrevocable, and, to the extent such offer is accepted, such Participating Seller shall be bound and obligated to Sell in the proposed Sale on the same terms and conditions, with respect to each Affected Unit Share sold (subject to Section 9.82.6), as the Prospective Selling Holders, up to such number of Affected Units Shares as such Participating Seller shall have specified in such Participating Seller’s Tag Along Offer; provided, however, that that: (ai) if the principal terms of the proposed Sale change with the result that the price per Affected Unit shall be less than 95% of the price per Affected Unit set forth in the Tag Along Notice or the other terms shall be materially less favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder thereunder; and (bii) if, at the end of the 120th the120th day following the date of the effectiveness of the Tag Along Notice (provided, that if the only condition, other than the making of payments or delivery of documents at such closing, to the completion of the proposed Sale is one or more regulatory or governmental approvals or consents, such 120 day period shall automatically be extended for an additional 45 days)Notice, the Fortress Prospective Selling Holders have not completed the proposed Sale, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunderunder his Tag Along Offer, the Tag Along Notice shall be null and void, and it shall be necessary for a separate Tag Along Notice to be furnished, and all of the terms and provisions of this Section 2.4 separately complied with, in order to consummate such proposed Sale pursuant to this Section 2.4, unless the failure to complete such Sale resulted from any failure by such any Participating Seller to comply with the terms of this Section 9.62.4; provided, however, that if any governmental approvals are required in connection with such Sale, such 120-day period shall be extended until the expiration of five (5) Business Days following the date on which all governmental approvals are obtained and any applicable waiting periods under applicable law have expired or been terminated.
9.6.6. (f) If, prior to consummation, the terms of the proposed Sale shall change with the result that the price per Affected Unit to be paid in such proposed Sale shall be greater than 105% of the price per Affected Unit set forth in the Tag Along Notice or the other terms of such proposed Sale shall be materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, the Tag Along Notice shall be null and void, and it shall be necessary for a separate Tag Along Notice to be furnished, and the terms and provisions of this Section 9.6 2.4 separately complied with, in order to consummate such proposed Sale pursuant to this Section 9.62.4; provided, however, that in the case of such a separate Tag Along Notice, each applicable period to which reference is made in Section 2.4 shall be the longer of (i) the remaining portion of the ten (10) business day period applicable to the assigned Tag Along Notice distributed in connection with such proposed transfer or (ii) five (5) Business Days.
9.6.7. (g) Notwithstanding the foregoing provisions of this Section 9.62.4, no other holder of Units Stockholder shall have any tag along right pursuant to the provisions of this Section 9.6 2.4 with respect to any Transfer of Units by the Fortress Holders:
(a) pursuant Shares to the exercise of their “drag along” rights contained in Section 9.7;
(b) to an Affiliate of any of the Fortress Holders Permitted Transferees or to partners, members, managing directors and principals of any of the Fortress Holders that is a partnership or limited liability company; provided that such transferee shall agree to be bound by the provisions of this Section 9.6 to the same extent as if such transferee were a Fortress Holder; or
(c) in a Public Sale.
9.6.8. (h) The foregoing provisions of this Section 9.6 2.4 shall expire upon the closing of a Qualified Public Offering and shall not apply to any Units Shares which have been Sold in a Public Sale.
Appears in 1 contract
Tag Along. 9.6.1. (a) If at any time any member of the Fortress Holders desire Onex Group proposes to Transfer 25% sell any Shares except for (i) sales to another member of the Onex Group that becomes bound by the terms of this Agreement (an "Onex Group Member"), (ii) sales to a Management Holder or more other management employee or directors of their collective Class A Units the Corporation or a Subsidiary, (iii) sales of the 500 Shares purchased by Onex on June 30, 1992 for later disposition to persons providing services to the Corporation or any of the Corporation's subsidiaries (the "500 Shares"), (iv) sales effected on a national securities exchange in a Series the regular way or in the over-the-counter market, or (v) pursuant to an offering of securities registered under the 1933 Act (a “Class A Transfer”"Tag Along Disposition"), or more than 50% each of their collective Class C Preferred Units or Class D Preferred Units (the Management Holders shall have the right to sell to the proposed purchaser a “Preferred Transfer”)number of his Manage- ment Shares equal to the total number of his Management Shares multiplied by a ratio, for value the numerator of which is the number of Shares to any Prospective Buyer, whether in one bona fide, arm’s length transaction or a series be sold by the Onex Group Member to the proposed purchaser and the denominator of related contemporaneous or contemporaneously agreed upon transactions and whether which is the total number of Shares then owned by the Onex Group. Such ratio is referred to one Prospective Buyer or more than one Prospective Buyer (a “Sale”) such Fortress Holders may only do so in herein as the manner and on the terms set forth in this Section 9.6. Any attempted Transfer "Share Ratio." A sale of Units subject Management Shares pursuant to this Section 9.6 and not permitted by this Section 9.6 shall be null and voidmade at the same price, upon the same terms, and at the Company and such Series shall not in any way give effect to any such impermissible Transfersame time as the sale by the Onex Group Member of its Shares.
9.6.2. A written (b) The Onex Group Member shall give notice (the “"Tag Along Notice”") shall be furnished by the Fortress Holders to (i) in the case of a Class A Transfer, each other holder of a Class A Unit Management Holder of the Series proposed to be sold, and (ii) in the case of a Preferred Transfer, each other holder of a Class C Preferred Unit or Class D Preferred Unit, as the case may be (collectively, the “Tag Along Offerors”), Disposition at least 20 business days prior to such Transferthe same. The Tag Along Notice shall include:
(a) The principal be in writing and shall describe the terms of the Tag Along Disposition in reasonable detail, the identity of the proposed Sale insofar it relates purchaser, the proposed date of sale, the purchase price per Share, and the Share Ratio and shall state that (i) the Management Holder has the option to sell to the Units proposed to be so sold (the “Affected Units”) including the purchaser a number of Units Management Shares equal to be purchased from the Fortress Holders, the percentage total number of all Affected Units held Management Shares then owned by such Holder multiplied by the Fortress Holders which such number of Units proposed to be so purchased constitutes Share Ratio, (ii) the “Tag Along Sale Percentage,” the expected per Unit purchase price (whichsale, in the case of Class C Preferred Units or Class D Preferred Unitsif made, shall be expressed made at the same price per share, upon the same terms, and at the same time as the sale by the Onex Group Member of its Shares to the proposed purchaser, and (iii) the sale by Management Holders will be conditioned upon a specified percentage sale of Shares by the Series 1 Class C Preferred Priority Return (in the case of Class C Preferred Units) or Series 1 Class D Preferred Priority Return (in the case of Class D Preferred Units) of the Units Onex Group Member pursuant to be sold), the name and address of the Prospective Buyer, a good-faith estimate of the amounts described in Section 9.8.4; andthis Section.
(bc) An invitation A Management Holder may exercise its sale option pursuant to each Tag Along Offeror to make an offer to include in the proposed Sale Section 4.1 by delivering to the Prospective Buyer an additional number of Affected UnitsOnex Group Member, but only including the vested portion of any Company Match Class A Units of such Series (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Tag Along Offeror) owned by such Tag Along Offeror, on the same terms and conditions with respect to each Unit sold (subject to Section 9.8), as the Fortress Holders shall Sell each of their Units. Notwithstanding the foregoing, in the event Fortress Holders are Transferring 100% of their collective economic or other rights that comprise their Series Interest in a Series in a Sale, the unvested portion of the Affected Units may be included in such proposed Sale pursuant to the terms of this Section 9.6.
9.6.3. Within 15 business within ten days after the receipt (in accordance with Section 18.3) of such Management Holder receives the Tag Along Notice, each Tag Along Offeror desiring to make an written notice of his offer to include Affected Units in the proposed Sale (each a “Participating Seller” and, together with the Fortress Holders, collectively, the “Tag Along Sellers”), shall send a written offer (the “Tag Along Offer”) sell Management Shares pursuant to the Fortress Holders specifying this Section and indicating the number of Units (not in any event Management Shares offered for sale. If a Management Holder gives notice of his election to exceed sell, he shall be obligated to do so, but the sale and his obligation to sell shall be conditioned upon the closing of the Tag Along Sale Percentage Disposition. If the purchaser specifies a limited number of Shares that it is willing to purchase in the aggregate, each Management Holder and the Onex Group Member shall have the right to sell its or his proportion of the Affected Units number of Shares that the purchaser is purchasing, i.e., the proportion that the number of Shares owned by such Participating Seller) which such Participating Seller desires to have included in the proposed Sale. Each Tag Along Offeror who does not return the Tag Along Offer within such 15 business day period shall be deemed to have waived all of such Tag Along Offeror’s rights with respect to such Sale, and the Tag Along Sellers shall thereafter be free to Sell to the Prospective Buyer, at a per Unit price no greater than 105% of the per Unit price set forth in the Tag Along Notice and on other terms which are not materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, without any further obligation to such non-accepting Tag Along Offerors.
9.6.4. The Fortress Holders shall attempt to obtain the inclusion in the proposed Sale of the entire number of Affected Units which the Tag Along Sellers desire to have included in the Sale (as evidenced in the case of the Fortress Holders by the Tag Along Notice and in the case of each Participating Seller by such Participating Seller’s Tag Along Offer). In the event the Fortress Holders shall be unable to obtain the inclusion of such entire number of Affected Units in the proposed Sale, the number of Affected Units to be sold in the proposed Sale by each Tag Along Seller shall be reduced on a pro rata basis according to the proportion which the number of all Affected Units which each such Tag Along Seller desires to have included in the Sale Person bears to the aggregate number of all Affected Units which all Shares owned by the shareholders who are selling Shares. If any Person does not elect to sell the full number of Shares that he or it is entitled to sell, the Tag Along Sellers desire to have included in the Sale.
9.6.5. The offer of each Participating Seller contained in such Participating Seller’s Tag Along Offer balance shall be irrevocableavailable, andin accordance with such procedures as the Onex Group Member may designate, to the extent such offer is accepted, such Participating Seller shall be bound and obligated shareholder that has elected to Sell in sell the proposed Sale on the same terms and conditions, with respect to each Affected Unit sold (subject to Section 9.8), as the Prospective Selling Holders, up to such maximum number of Affected Units as Shares initially available to it or him for such Participating Seller shall have specified in such Participating Seller’s Tag Along Offer; provided, however, that (a) if the principal terms of the proposed Sale change with the result that the price per Affected Unit shall be less than 95% of the price per Affected Unit set forth in the Tag Along Notice or the other terms shall be materially less favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder and (b) if, at the end of the 120th day following the date of the effectiveness of the Tag Along Notice (provided, that if the only condition, other than the making of payments or delivery of documents at such closing, to the completion of the proposed Sale is one or more regulatory or governmental approvals or consents, such 120 day period shall automatically be extended for an additional 45 days), the Fortress Holders have not completed the proposed Sale, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder, unless the failure to complete such Sale resulted from any failure by such Participating Seller to comply with the terms purpose. For purposes of this Section 9.64.1, the number of Shares owned by any Onex Group Member shall not be deemed to include any portion of the 500 Shares then owned by any Onex Group Member.
9.6.6. If, prior to consummation, the terms (d) If a transferee of the proposed Sale shall change with the result that the price per Affected Unit to be paid in such proposed Sale shall be greater than 105% of the price per Affected Unit set forth in the Tag Along Notice or the other terms of such proposed Sale shall be materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, the Tag Along Notice shall be null and void, and it shall be necessary for a separate Tag Along Notice to be furnished, and the terms and provisions of this Section 9.6 separately complied with, in order to consummate such proposed Sale Onex Shares pursuant to this Section 9.6.
9.6.7. Notwithstanding the foregoing provisions 4.1 acquires such Shares free of this Section 9.6Agreement, no other holder of Units shall have any tag along right pursuant to the provisions of this Section 9.6 with respect to any Transfer of Units by the Fortress Holders:
(a) pursuant to the exercise of their “drag along” rights contained in Section 9.7;
(b) to an Affiliate of any of the Fortress Holders or to partners, members, managing directors and principals of any of the Fortress Holders that is a partnership or limited liability company; provided that then such transferee shall agree to be bound also take the Management Shares being sold by the provisions a Management Holder free of this Section 9.6 Agreement. If, however, any Onex Group Member is required to transfer any Onex Shares subject to this Agreement, then the same extent as if such transferee were a Fortress Holder; or
(c) in a Public SaleManagement Holder shall also transfer his Management Shares subject to this Agreement.
9.6.8. The foregoing provisions of this Section 9.6 shall expire upon the closing of a Qualified Public Offering and shall not apply to any Units which have been Sold in a Public Sale.
Appears in 1 contract
Tag Along. 9.6.1. If the Fortress Holders desire to Transfer 25% or more No holder of their collective Class Series A Units in a Series Shares (each such holder, a “Class Prospective Series A TransferSeller”), or more than 50% of their collective Class C Preferred Units or Class D Preferred Units (a “Preferred Transfer”), ) shall Transfer for value to any Prospective Buyer, whether in one bona fide, arm’s length transaction or a series of related contemporaneous or contemporaneously agreed upon transactions and whether to one Prospective Buyer or more than one Prospective Buyer (a “Sale”) any such Fortress Holders may only do so Series A Shares to a Prospective Buyer except in the manner and on the terms set forth in compliance with this Section 9.63.1. Any attempted Transfer of Units subject to Shares not in compliance with this Section 9.6 and not permitted by this Section 9.6 3 shall be null and void, and the Company and such Series shall not in any way give effect to any such impermissible Transfer.
9.6.2. (a) A written notice (the “Tag Along Notice”) shall be furnished by the Fortress Holders Prospective Series A Seller to (i) in the case of a Class A Transfer, each other holder of Shares (each, a Class A Unit of the Series proposed to be sold, and (ii) in the case of a Preferred Transfer, each other holder of a Class C Preferred Unit or Class D Preferred Unit, as the case may be (collectively, the “Tag Along OfferorsHolder”), ) at least 20 ten (10) business days prior to such Transfer. The Tag Along Notice shall include:
(ai) The principal the material terms and conditions of the proposed Sale insofar as it relates to the Units proposed to be so sold (the “Affected Units”) sale of Shares, including the number and type of Units Shares to be purchased Transferred from the Fortress HoldersProspective Series A Seller, the percentage of all Affected Units held by the Fortress Holders which such number of Units proposed to be so purchased constitutes the “Tag Along Sale Percentage,” , the expected maximum and minimum per Unit share purchase price for each type of Shares (which, if the Prospective Buyer fails to allocate or reasonably indicate a per share purchase price for each type of Shares to be included in the case proposed Sale, the Board shall determine in good faith the per share purchase price for each type of Class C Preferred Units or Class D Preferred Units, shall be expressed as a specified percentage of the Series 1 Class C Preferred Priority Return (in the case of Class C Preferred UnitsShare) or Series 1 Class D Preferred Priority Return (in the case of Class D Preferred Units) of the Units to be sold), and the name and address of the prospective transferee (the “Prospective Buyer, a good-faith estimate of the amounts described in Section 9.8.4”); and
(bii) An an invitation to each Tag Along Offeror Holder to make an offer to include in the proposed Sale to the Prospective Buyer an additional number of Affected Units, but only including the vested portion of any Company Match Class A Units of such Series Shares (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned total number and type of Shares held by such Tag Along OfferorHolder) owned by such Tag Along OfferorHolder, on the same terms and conditions with respect to each Unit sold (subject to Section 9.8), as the Fortress Holders shall Sell each of their Units. Notwithstanding the foregoing, in the event Fortress Holders are Transferring 100% of their collective economic or other rights that comprise their Series Interest in a Series in a Sale, the unvested portion of the Affected Units may be included in such proposed Sale pursuant to the terms of this Section 9.6.
9.6.3. Within 15 business days after the receipt (in accordance with Section 18.3) of the Tag Along Notice, each Tag Along Offeror desiring to make an offer to include Affected Units in the proposed Sale (each a “Participating Seller” and, together with the Fortress Holders, collectively, the “Tag Along Sellers”), shall send a written offer (the “Tag Along Offer”) to the Fortress Holders specifying the number of Units (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Participating Seller) which such Participating Seller desires to have included in the proposed Sale. Each Tag Along Offeror who does not return the Tag Along Offer within such 15 business day period shall be deemed to have waived all of such Tag Along Offeror’s rights with respect to such Sale, and the Tag Along Sellers shall thereafter be free to Sell to the Prospective Buyer, at a per Unit price no greater than 105% of the per Unit price set forth in the Tag Along Notice and on other terms which are not materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, without any further obligation to such non-accepting Tag Along Offerors.
9.6.4. The Fortress Holders shall attempt to obtain the inclusion in the proposed Sale of the entire number of Affected Units which the Tag Along Sellers desire to have included in the Sale (as evidenced in the case of the Fortress Holders by the Tag Along Notice and in the case of each Participating Seller by such Participating Seller’s Tag Along Offer). In the event the Fortress Holders shall be unable to obtain the inclusion of such entire number of Affected Units in the proposed Sale, the number of Affected Units to be sold in the proposed Sale by each Tag Along Seller shall be reduced on a pro rata basis according to the proportion which the number of all Affected Units which each such Tag Along Seller desires to have included in the Sale bears to the aggregate number of all Affected Units which all of the Tag Along Sellers desire to have included in the Sale.
9.6.5. The offer of each Participating Seller contained in such Participating Seller’s Tag Along Offer shall be irrevocable, and, to the extent such offer is accepted, such Participating Seller shall be bound and obligated to Sell in the proposed Sale on the same terms and conditions, subject to Section 3.3(d) in the case of Options, with respect to each Affected Unit type of Shares to be sold (subject to Section 9.8)in the Sale, as the Prospective Selling Holders, up to such number of Affected Units as such Participating Series A Seller shall have specified in such Participating Seller’s Tag Along Offer; provided, however, that (a) if the principal terms of the proposed Sale change with the result that the price per Affected Unit shall be less than 95% of the price per Affected Unit set forth in the Tag Along Notice or the other terms shall be materially less favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder and (b) if, at the end of the 120th day following the date of the effectiveness of the Tag Along Notice (provided, that if the only condition, other than the making of payments or delivery of documents at such closing, to the completion of the proposed Sale is one or more regulatory or governmental approvals or consents, such 120 day period shall automatically be extended for an additional 45 days), the Fortress Holders have not completed the proposed Sale, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder, unless the failure to complete such Sale resulted from any failure by such Participating Seller to comply with the terms of this Section 9.6Sell its Shares.
9.6.6. If, prior to consummation, the terms of the proposed Sale shall change with the result that the price per Affected Unit to be paid in such proposed Sale shall be greater than 105% of the price per Affected Unit set forth in the Tag Along Notice or the other terms of such proposed Sale shall be materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, the Tag Along Notice shall be null and void, and it shall be necessary for a separate Tag Along Notice to be furnished, and the terms and provisions of this Section 9.6 separately complied with, in order to consummate such proposed Sale pursuant to this Section 9.6.
9.6.7. Notwithstanding the foregoing provisions of this Section 9.6, no other holder of Units shall have any tag along right pursuant to the provisions of this Section 9.6 with respect to any Transfer of Units by the Fortress Holders:
(a) pursuant to the exercise of their “drag along” rights contained in Section 9.7;
(b) to an Affiliate Each Tag Along Holder’s “Tag Along Sale Percentage” shall represent such Tag Along Holder’s percentage ownership (based on the relative value of any such Tag Along Holder’s number and type of the Fortress Holders or to partners, members, managing directors and principals Shares) of any of the Fortress Holders that is a partnership or limited liability company; provided that such transferee shall agree to be bound by the provisions of this Section 9.6 to the same extent as if such transferee were a Fortress Holder; or
(c) in a Public Saleall Shares.
9.6.8. The foregoing provisions of this Section 9.6 shall expire upon the closing of a Qualified Public Offering and shall not apply to any Units which have been Sold in a Public Sale.
Appears in 1 contract
Tag Along. 9.6.1. If (a) Prior to an Initial Public Offering, in the Fortress event that the Apax Holders desire intend to Transfer 25% to any Person (other than transfers to Affiliates or sales to one or more co-investors in transactions that are customary for the syndication of their collective Class A Units in a Series (a “Class A Transfer”investments by private equity funds of the size and type of the Apax Investors), or more than 50% of their collective Class C Preferred Units or Class D Preferred Units (a “Preferred Transfer”), for value to any Prospective Buyer, whether in one bona fide, arm’s length transaction or a series of related contemporaneous or contemporaneously agreed upon transactions and whether to one Prospective Buyer or more than one Prospective Buyer (a “Tag-Along Sale”), any Units, the Apax Holders shall give not less than ten (10) days prior written notice of such Fortress Holders may only do so in intended Transfer to the manner Partnership and on to the terms set forth in this Section 9.6Common Series B Limited Partners (the “Tag-Along Offerees”). Any attempted Transfer of Units subject to this Section 9.6 and not permitted by this Section 9.6 shall be null and void, and the Company and such Series shall not in any way give effect to any such impermissible Transfer.
9.6.2. A written Such notice (the “Tag Tag-Along Notice”) shall be furnished by the Fortress Holders to (i) in the case set forth all material terms and conditions of a Class A such proposed Transfer, each other holder of a Class A Unit including the name of the Series prospective transferee, the number of Units proposed to be soldTransferred to the extent known (the “Tag-Along Securities”) by the Apax Holders, the aggregate purchase price proposed to be paid therefor and the payment terms and type of Transfer to be effectuated. Within five (ii5) in days following the case delivery of a Preferred Transferthe Tag-Along Notice by the Apax Holders to the Tag-Along Offerees and to the Partnership, each other holder of a Class C Preferred Unit or Class D Preferred UnitTag-Along Offeree shall, by notice in writing to the Apax Holders and the Partnership, have the opportunity and right to sell to the purchaser (upon the same terms and conditions as the case may Apax Holders, including with respect to representations, warranties, covenants and indemnities (each of which would be (collectivelymade severally by each such Tag-Along Offeree, the “Tag based on such Tag-Along Offerors”), at least 20 business days prior to such Transfer. The Tag Along Notice shall include:
(a) The principal terms Offeree’s pro rata share of the proposed Sale insofar it relates aggregate consideration to be paid by the purchaser) the same percentage of Common Series B Units held by such Tag-Along Offeree as such Transfer represents with respect to the Units proposed to be so sold (the “Affected Units”) including the number of Units to be purchased from the Fortress Holders, the percentage of all Affected Units held by the Fortress Apax Holders. No Partner shall have the right to sell any Common Series C Units in any Tag-Along Sale. The Apax Holders which such number and/or each Tag-Along Offeree shall Transfer to the purchaser all of the Units proposed to be so purchased constitutes sold by them at not less than the “Tag Along Sale Percentage,” the expected per Unit purchase price (whichsubject, in to the case last sentence of Class C Preferred Units or Class D Preferred Unitsthis Section 9.3(a)) and upon other terms and conditions, if any, not more favorable to the purchaser than those originally offered. The Apax Holder shall be expressed as a specified percentage of the Series 1 Class C Preferred Priority Return (in the case of Class C Preferred Units) or Series 1 Class D Preferred Priority Return (in the case of Class D Preferred Units) of the not Transfer any Units to be sold), such purchaser if such purchaser declines to permit the name and address of the Prospective Buyer, a goodparticipating Tag-faith estimate of the amounts described in Section 9.8.4; and
(b) An invitation Along Offerees to each Tag Along Offeror to make an offer to include in the proposed Sale to the Prospective Buyer an additional number of Affected Units, but only including the vested portion of any Company Match Class A Units of such Series (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Tag Along Offeror) owned by such Tag Along Offeror, on the same terms and conditions with respect to each Unit sold (subject to Section 9.8), as the Fortress Holders shall Sell each of their Units. Notwithstanding the foregoing, in the event Fortress Holders are Transferring 100% of their collective economic or other rights that comprise their Series Interest in a Series in a Sale, the unvested portion of the Affected Units may be included in such proposed Sale participate pursuant to the terms of this Section 9.6.
9.6.39.3. Within 15 business days after The consideration to be received by the receipt (Tag-Along Offerees in accordance with Section 18.3) the Tag-Along Sale in respect of their Common Series B Units shall be the Tag Along Notice, each Tag Along Offeror desiring same form of consideration and the same per Unit price as the price paid to make an offer to include Affected the Apax Holders for their Common Series A Units in the Tag-Along Sale.
(b) At the closing of any proposed Sale (each Transfer in respect of which a “Participating Seller” andTag-Along Notice has been delivered, the Apax Holders, together with the Fortress Holders, collectively, the “Tag all Tag-Along Sellers”), Offerees so electing to sell Common Series B Units pursuant to Section 9.3(a) shall send a written offer (the “Tag Along Offer”) deliver to the Fortress Holders specifying proposed transferee certificates and/or other instruments representing the number of Units (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Participating Seller) which such Participating Seller desires to have included in the proposed Sale. Each Tag Along Offeror who does not return the Tag Along Offer within such 15 business day period shall be deemed to have waived all of such Tag Along Offeror’s rights with respect to such Sale, and the Tag Along Sellers shall thereafter be free to Sell to the Prospective Buyer, at a per Unit price no greater than 105% of the per Unit price set forth in the Tag Along Notice and on other terms which are not materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, without any further obligation to such non-accepting Tag Along Offerors.
9.6.4. The Fortress Holders shall attempt to obtain the inclusion in the proposed Sale of the entire number of Affected Units which the Tag Along Sellers desire to have included in the Sale (as evidenced in the case of the Fortress Holders by the Tag Along Notice and in the case of each Participating Seller by such Participating Seller’s Tag Along Offer). In the event the Fortress Holders shall be unable to obtain the inclusion of such entire number of Affected Units in the proposed Sale, the number of Affected Units to be sold in the proposed Sale by each Tag Along Seller shall be reduced on a pro rata basis according to the proportion which the number sold, free and clear of all Affected Units which each such Tag Along Seller desires to have included in the Sale bears to the aggregate number of all Affected Units which all of the Tag Along Sellers desire to have included in the Sale.
9.6.5. The offer of each Participating Seller contained in such Participating Seller’s Tag Along Offer shall be irrevocableLiens, andtogether with appropriate powers duly endorsed therefor, to the extent such offer is accepted, such Participating Seller shall be bound and obligated to Sell in the proposed Sale on the same terms and conditions, with respect to each Affected Unit sold (subject to Section 9.8), as the Prospective Selling Holders, up to such number of Affected Units as such Participating Seller shall have specified in such Participating Seller’s Tag Along Offer; provided, however, that (a) if the principal terms of the proposed Sale change with the result that the price per Affected Unit shall be less than 95% of the price per Affected Unit set forth in the Tag Along Notice or the other terms shall be materially less favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder and (b) if, at receive in exchange therefor the end of the 120th day following the date of the effectiveness of the Tag Along Notice (provided, that if the only condition, other than the making of payments or delivery of documents at such closing, to the completion of the proposed Sale is one or more regulatory or governmental approvals or consents, such 120 day period shall automatically be extended for an additional 45 days), the Fortress Holders have not completed the proposed Sale, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder, unless the failure to complete such Sale resulted from any failure by such Participating Seller to comply with the terms of this Section 9.6.
9.6.6. If, prior to consummation, the terms of the proposed Sale shall change with the result that the price per Affected Unit consideration to be paid or delivered by the proposed transferee in respect of such proposed Sale shall be greater than 105% of the price per Affected Unit set forth Units as described in the Tag Along Notice or the other terms of such proposed Sale shall be materially more favorable to the Tag Along Sellers than those set forth in the Tag Tag-Along Notice, the Tag Along Notice shall be null and void, and it shall be necessary for a separate Tag Along Notice to be furnished, and the terms and .
(c) The provisions of this Section 9.6 separately complied with, in order to consummate such proposed Sale pursuant to this Section 9.6.
9.6.7. Notwithstanding the foregoing provisions of this Section 9.6, no other holder of Units shall have any tag along right pursuant to the provisions of this Section 9.6 with respect to any Transfer of Units by the Fortress Holders:
(a) pursuant to the exercise of their “drag along” rights contained in Section 9.7;
(b) to an Affiliate of any of the Fortress Holders or to partners, members, managing directors and principals of any of the Fortress Holders that is a partnership or limited liability company; provided that such transferee shall agree to be bound by the provisions of this Section 9.6 to the same extent as if such transferee were a Fortress Holder; or
(c) in a Public Sale.
9.6.8. The foregoing provisions of this Section 9.6 shall expire upon the closing of a Qualified Public Offering and 9.3 shall not apply to (i) any Units which have been Sold in Transfer pursuant to a Public SaleOffering, or (ii) any Transfers pursuant to Section 9.2 hereof.
Appears in 1 contract
Sources: Limited Partnership Agreement (Epicor International Holdings, Inc.)
Tag Along. 9.6.1. If the Fortress Holders desire Waterton, a Permitted Transferee thereof or any Affiliated Fund proposes to Transfer 25% Transfer, directly or more of their collective Class A indirectly, any Units held by it (“Waterton Units”) to a Prospective Buyer in a Series transaction (a “Class A Tag Along Transfer”) which is not (A) to a Permitted Transferee under the terms of Section 11.2(c)(ii), (iii) or (iv), or more than 50% of their collective Class C Preferred Units or Class D Preferred Units (B) a Transfer in connection with which Waterton has elected to exercise its “Preferred Transfer”), for value to any Prospective Buyer, whether in one bona fide, arm’s length transaction or drag along” rights under Section 12.1:
(a) Notice. Waterton will deliver a series of related contemporaneous or contemporaneously agreed upon transactions and whether to one Prospective Buyer or more than one Prospective Buyer (a “Sale”) such Fortress Holders may only do so in the manner and on the terms set forth in this Section 9.6. Any attempted Transfer of Units subject to this Section 9.6 and not permitted by this Section 9.6 shall be null and void, and the Company and such Series shall not in any way give effect to any such impermissible Transfer.
9.6.2. A written notice (the “Tag Along Notice”) shall be furnished to each Member holding the same class or classes of Units held by the Fortress Holders to Waterton (i) in the case of each, a Class A Transfer, each other holder of a Class A Unit of the Series proposed to be sold, and (ii) in the case of a Preferred Transfer, each other holder of a Class C Preferred Unit or Class D Preferred Unit, as the case may be (collectively, the “Tag Along OfferorsHolder”), at least 20 business days ten Business Days prior to such Tag Along Transfer. The Tag Along Notice shall will include:
(ai) The principal terms of the proposed Sale Tag Along Transfer insofar as it relates to such Waterton Units, including (A) the number and class of Waterton Units proposed to be so sold purchased, directly or indirectly, from the Waterton Group Members, (B) the “Affected Units”) including fraction, expressed as a percentage, determined by dividing the number of each class of Waterton Units to be purchased purchased, directly or indirectly, from the Fortress Holders, Waterton Group Members by the percentage total number of all Affected each such class of Waterton Units held by the Fortress Holders which such number of Units proposed to be so purchased constitutes the Waterton Group Members (each a “Tag Along Sale Transfer Percentage,” ”), (C) the expected per Unit estimated purchase price per respective Unit or formula for determining such price, (whichD) the anticipated form of consideration for each such Waterton Unit, in the case of Class C Preferred Units or Class D Preferred Units, shall be expressed as a specified percentage of the Series 1 Class C Preferred Priority Return (in the case of Class C Preferred UnitsE) or Series 1 Class D Preferred Priority Return (in the case of Class D Preferred Units) of the Units to be sold), the name and address of the Prospective Buyer, a good-faith estimate of Buyer and (F) the amounts described in Section 9.8.4expected closing date for the Transfer; and
(bii) An invitation to each Tag Along Offeror Holder to make an offer to include in the proposed Sale Tag Along Transfer to the applicable Prospective Buyer an additional number of Affected Units, but only including the vested portion of any Company Match Class A issued and outstanding Units of each class held by such Series Tag Along Holder that are of the same class being proposed for Transfer by the Waterton Group Members (not in any event to exceed the product of the Tag Along Sale Transfer Percentage multiplied by the total number of the Affected Units owned of each class held by such Tag Along Offeror) owned by such Tag Along OfferorHolder), on the same economic terms and conditions with respect to each Unit sold (subject to Section 9.8), such class of Units as the Fortress Holders shall Sell Waterton Group Members will Transfer, directly or indirectly, each of their respective class of Units. Notwithstanding , provided that if the foregoingWaterton Group Members are Transferring, in the event Fortress Holders are Transferring 100% directly or indirectly, multiple classes of their collective economic or other rights that comprise their Series Interest in a Series in a Sale, the unvested portion of the Affected Units may be included in such proposed Sale pursuant to the terms of this Section 9.6.
9.6.3. Within 15 business days after the receipt (in accordance with Section 18.3) of the Tag Along NoticeUnits, each Tag Along Offeror desiring Holder may be required to make an offer to include Affected Transfer the same classes of Units in the proposed Sale (each a “Participating Seller” and, together with the Fortress Holders, collectively, the “Tag Along Sellers”), shall send a written offer (the “Tag Along Offer”) to the Fortress Holders specifying the number of Units (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Participating Seller) which such Participating Seller desires to have included in the proposed Sale. Each Tag Along Offeror who does not return the Tag Along Offer within such 15 business day period shall be deemed to have waived all of such Tag Along Offeror’s rights with respect to such Sale, and the Tag Along Sellers shall thereafter be free to Sell to the Prospective Buyer, at a per Unit price no greater than 105% of the per Unit price set forth in the Tag Along Notice and on other terms which are not materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, without any further obligation to such non-accepting Tag Along Offerors.
9.6.4. The Fortress Holders shall attempt to obtain the inclusion in the proposed Sale of the entire number of Affected Units which the Tag Along Sellers desire to have included in the Sale (as evidenced in the case of the Fortress Holders by the Tag Along Notice and in the case of each Participating Seller by such Participating Seller’s Tag Along Offer). In the event the Fortress Holders shall be unable to obtain the inclusion of such entire number of Affected Units in the proposed Sale, the number of Affected Units to be sold in the proposed Sale by each Tag Along Seller shall be reduced on a pro rata basis according to the same proportion which the number of all Affected Units which each such Tag Along Seller desires to have included in the Sale bears to the aggregate number of all Affected Units which all of the Tag Along Sellers desire to have included in the Sale.
9.6.5. The offer of each Participating Seller contained in such Participating Seller’s Tag Along Offer shall be irrevocable, and, to the extent such offer is accepted, such Participating Seller shall be bound and obligated to Sell in the proposed Sale on the same terms and conditions, with respect to each Affected Unit sold (subject to Section 9.8), as the Prospective Selling Holders, up to such number of Affected Units as such Participating Seller shall have specified in such Participating Seller’s Tag Along Offer; provided, however, that (a) if the principal terms of the proposed Sale change with the result that the price per Affected Unit shall be less than 95% of the price per Affected Unit set forth in the Tag Along Notice or the other terms shall be materially less favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder and (b) if, at the end of the 120th day following the date of the effectiveness of the Tag Along Notice (provided, that if the only condition, other than the making of payments or delivery of documents at such closing, to the completion of the proposed Sale is one or more regulatory or governmental approvals or consents, such 120 day period shall automatically be extended for an additional 45 days), the Fortress Holders have not completed the proposed Sale, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder, unless the failure to complete such Sale resulted from any failure by such Participating Seller to comply with the terms of this Section 9.6Waterton Group Members.
9.6.6. If, prior to consummation, the terms of the proposed Sale shall change with the result that the price per Affected Unit to be paid in such proposed Sale shall be greater than 105% of the price per Affected Unit set forth in the Tag Along Notice or the other terms of such proposed Sale shall be materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, the Tag Along Notice shall be null and void, and it shall be necessary for a separate Tag Along Notice to be furnished, and the terms and provisions of this Section 9.6 separately complied with, in order to consummate such proposed Sale pursuant to this Section 9.6.
9.6.7. Notwithstanding the foregoing provisions of this Section 9.6, no other holder of Units shall have any tag along right pursuant to the provisions of this Section 9.6 with respect to any Transfer of Units by the Fortress Holders:
(a) pursuant to the exercise of their “drag along” rights contained in Section 9.7;
(b) to an Affiliate of any of the Fortress Holders or to partners, members, managing directors and principals of any of the Fortress Holders that is a partnership or limited liability company; provided that such transferee shall agree to be bound by the provisions of this Section 9.6 to the same extent as if such transferee were a Fortress Holder; or
(c) in a Public Sale.
9.6.8. The foregoing provisions of this Section 9.6 shall expire upon the closing of a Qualified Public Offering and shall not apply to any Units which have been Sold in a Public Sale.
Appears in 1 contract
Sources: Limited Liability Company Agreement
Tag Along. 9.6.1. If (a) No Keurig Partner shall consummate any Transfer of its Units to any Person (the Fortress Holders desire “Tag-Along Purchaser”) pursuant to Transfer 25% or more of their collective Class A Units in a Series Section 8.2(a)(iii) (a “Class A Tag-Along Transfer”) unless the terms and conditions of such Tag-Along Transfer includes an offer by the Tag-Along Purchaser to the Co-Investor Limited Partner to, at the option of the Co-Investor Limited Partner, include in such Tag-Along Transfer all or a portion of the Units owned by the Co-Investor Limited Partner determined in accordance with Section 8.7(b). If a Keurig Partner desires to consummate a Tag-Along Transfer (in such capacity, the “Tag-Along Seller”), or more than 50% of their collective Class C Preferred Units or Class D Preferred Units (the Tag-Along Seller shall send a “Preferred Transfer”), for value to any Prospective Buyer, whether in one bona fide, arm’s length transaction or a series of related contemporaneous or contemporaneously agreed upon transactions and whether to one Prospective Buyer or more than one Prospective Buyer (a “Sale”) such Fortress Holders may only do so in the manner and on the terms set forth in this Section 9.6. Any attempted Transfer of Units subject to this Section 9.6 and not permitted by this Section 9.6 shall be null and void, and the Company and such Series shall not in any way give effect to any such impermissible Transfer.
9.6.2. A written notice of the Tag-Along Transfer (the “Tag Along Offer Notice”) shall be furnished by the Fortress Holders to (i) in the case of a Class A Transfer, each other holder of a Class A Unit of the Series proposed to be sold, and (ii) in the case of a Preferred Transfer, each other holder of a Class C Preferred Unit or Class D Preferred Unit, as the case may be (collectively, the “Tag Along Offerors”), at least 20 business days prior to such Transfer. The Tag Along Notice shall include:
(a) The principal terms of the proposed Sale insofar it relates to the Units proposed to be so sold (the “Affected Units”) including Co-Investor Limited Partner, which shall set forth the number of Units to be purchased from the Fortress Holders, the percentage of all Affected Units held by the Fortress Holders which such number and class of Units proposed to be so purchased constitutes Transferred by the “Tag Tag-Along Sale Percentage,” Seller, the expected per Unit purchase price (which, in consideration to be paid by the case of Class C Preferred Units or Class D Preferred Units, shall be expressed as a specified percentage Tag-Along Purchaser and the other material terms and conditions of the Series 1 Class C Preferred Priority Return (in the case of Class C Preferred Units) or Series 1 Class D Preferred Priority Return (in the case of Class D Preferred Units) of the Units to be sold), the name and address of the Prospective Buyer, a goodTag-faith estimate of the amounts described in Section 9.8.4; andAlong Transfer.
(b) An invitation If the Co-Investor Limited Partner desires to each Tag Along Offeror to make an offer to include participate in the proposed Sale Tag-Along Transfer, it must provide written notice to the Prospective Buyer an additional number Tag-Along Seller within ten (10) Business Days of Affected Units, but only including the vested portion of any Company Match Class A Units of such Series (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Tag Along Offeror) owned by such Tag Along Offeror, on the same terms and conditions with respect to each Unit sold (subject to Section 9.8), as the Fortress Holders shall Sell each of their Units. Notwithstanding the foregoing, in the event Fortress Holders are Transferring 100% of their collective economic or other rights that comprise their Series Interest in a Series in a Sale, the unvested portion of the Affected Units may be included in such proposed Sale pursuant to the terms of this Section 9.6.
9.6.3. Within 15 business days after the receipt (in accordance with Section 18.3) of the Tag Along Offer Notice, each Tag Along Offeror desiring to make an offer to include Affected Units in the proposed Sale (each a “Participating Seller” and, together with the Fortress Holders, collectively, the “Tag Along Sellers”), which notice shall send a written offer (the “Tag Along Offer”) to the Fortress Holders specifying set forth the number of Units (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Participating Seller) which such Participating Seller Co-Investor desires to Transfer in such Tag-Along Transfer. The Co-Investor Limited Partner shall have included the right to sell in the proposed Sale. Each Tag such Tag-Along Offeror who does not return the Tag Along Offer within such 15 business day period shall be deemed to have waived all Transfer, if consummated, a number of such Tag Along Offeror’s rights with respect Units equal to such Sale, number and the Tag Along Sellers shall thereafter classes of Units elected to be free to Sell to the Prospective Buyer, at a per Unit price no greater than 105% of the per Unit price set forth in the Tag Along Notice and on other terms which are not materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, without any further obligation to such non-accepting Tag Along Offerors.
9.6.4. The Fortress Holders shall attempt to obtain the inclusion in the proposed Sale of the entire number of Affected Units which the Tag Along Sellers desire to have included in the Sale (as evidenced in the case of the Fortress Holders Transferred by the Tag Along Notice and in the case of each Participating Seller by such Participating Seller’s Tag Along Offer). In the event the Fortress Holders shall be unable to obtain the inclusion of such entire number of Affected Units in the proposed Sale, the number of Affected Units to be sold in the proposed Sale by each Tag Along Seller shall be reduced Co-Investor Limited Partner on a pro rata basis according in proportion to the proportion which the number of all Affected the classes of Units, as applicable, being Transferred by a Tag-Along Seller; provided, further, that Class A Units, on the one hand, and Class B Units, on the other hand, sold by the Co-Investor Limited Partner in such Tag-Along Transfer shall be allocated pro rata among the voting and non-voting Units which of each such Tag class of Units. For the avoidance of doubt, the Co-Investor Limited Partner shall not have the right to participate in a Tag-Along Seller desires to have included Transfer if such participation would result in the Sale bears to the aggregate number of all Affected Units which all violation of the Tag Along Sellers desire to have included Transfer Restrictions in the SaleSection 8.3(e)(iii) or Section 8.3(e)(iv).
9.6.5. (c) The offer purchase of each Participating Seller contained in such Participating Seller’s Tag Units by a Tag-Along Offer Purchaser from the Co-Investor Limited Partner pursuant to this Section 8.7 shall be irrevocable, and, to the extent such offer is accepted, such Participating Seller shall be bound and obligated to Sell in the proposed Sale on substantially the same terms and conditions, and at substantially the same time as the purchase from the Tag-Along Seller, including the same base valuation for the JV (as determined on the basis of the hypothetical liquidation of the JV) implied by the consideration to be received by the Tag-Along Seller.
(d) If within ten (10) Business Days after its receipt of the Tag Offer Notice the Co-Investor Limited Partner has not accepted the offer contained in the Tag Offer Notice, the Co-Investor Limited Partner shall be deemed to have waived, subject to Section 8.7(e), any and all rights with respect to each Affected Unit sold (subject to Section 9.8), as the Prospective Selling Holders, up to such number Transfer of Affected Units as such Participating described in the Tag Offer Notice and the Tag-Along Seller shall have specified sixty (60) days in which to Transfer not more than the Units described in the Tag Offer Notice, on the terms not more favorable to the Tag-Along Seller than were set forth in the Tag Offer Notice; provided that if the Tag-Along Transfer requires any regulatory approval or competition clearance prior to consummating such transaction, such sixty (60) day period shall be extended to the date that is five (5) Business Days after such regulatory approval or clearance has been obtained or finally denied.
(e) If, at the end of such sixty (60) days following the Co-Investor Limited Partner’s receipt of the Tag Offer Notice (as it may be extended), the Tag-Along Seller has not completed a Transfer of Units in accordance with the terms of the Tag Offer Notice, the obligations with respect to a Transfer contained in this Section 8.7 with respect to Units owned by the Tag-Along Seller shall again be in effect.
(f) In the event that the Co-Investor Limited Partner elects to participate in a Tag-Along Transfer, it shall (i) make customary representations and warranties solely with respect to title to and ownership of the Units it is selling in such Participating Seller’s Tag Tag-Along OfferTransfer and due power and authority of the Co-Investor Limited Partner in connection with such Tag-Along Transfer; (ii) execute all documents, certificates and other deliveries signed by the Tag-Along Seller in connection with such Transfer, and be severally (but not jointly) obligated to join on a pro rata basis (based on its share of the aggregate proceeds received by the Limited Partners in such Tag-Along Transfer) in any indemnification obligation the Tag-Along Seller agrees to in connection with such Transfer (other than any such obligations that relate specifically to another Limited Partner, such as indemnification with respect to representations and warranties given by such Limited Partner regarding his, her or its title to and ownership of its Units); provided, however, that (a) if the principal terms Co-Investor Limited Partner shall not be obligated in connection with such Tag-Along Transfer to indemnify any party in an aggregate amount in excess of the proposed Sale change net cash proceeds actually paid to and received by the Co-Investor Limited Partner in such Tag-Along Transfer, other than in respect of Fraud or representations with respect to title to and ownership of its Transferred Units and its due power and authority in connection with such Transfer; (iii) consent to, vote in favor of and raise no objections against any such Tag-Along Transfer; (iv) not exercise any rights of appraisal, dissenters’ rights or similar rights, all of which are hereby waived; and (v) furnish information and copies of documents, in each case, that are reasonable and customary for transactions of its type. For the avoidance of doubt, the Co-Investor Limited Partner shall not be required to agree to any non-competition, non-solicitation or other restrictive covenants in connection with the result Tag-Along Transfer, other than reasonable and customary confidentiality restrictions to which the Tag-Along Seller is also bound.
(g) In the event that the price per Affected Unit Co-Investor Limited Partner elects to participate in a Tag-Along Transfer, the closing of such Tag-Along Transfer will take place at such time and place as the Tag-Along Seller shall be less than 95% specify by notice to the Co-Investor Limited Partner; provided, however, that, without the prior written consent of the price per Affected Unit set forth Co-Investor Limited Partner, in no event shall the Tag Tag-Along Notice or the other terms shall Transfer be materially less favorable to the Tag Along Sellers consummated within fewer than those set forth in the Tag Along Notice, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder and twenty (b20) if, at the end Business Days of the 120th day following the date of the effectiveness Co-Investor’s receipt of the Tag Along Notice (provided, that if the only condition, other than the making of payments or delivery of documents at such closing, to the completion of the proposed Sale is one or more regulatory or governmental approvals or consents, such 120 day period shall automatically be extended for an additional 45 days), the Fortress Holders have not completed the proposed Sale, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder, unless the failure to complete such Sale resulted from any failure by such Participating Seller to comply with the terms of this Section 9.6Notice.
9.6.6. If, prior to consummation, the terms of the proposed Sale shall change with the result that the price per Affected Unit to be paid in such proposed Sale shall be greater than 105% of the price per Affected Unit set forth in the Tag Along Notice or the other terms of such proposed Sale shall be materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, the Tag Along Notice shall be null and void, and it shall be necessary for a separate Tag Along Notice to be furnished, and the terms and provisions of this Section 9.6 separately complied with, in order to consummate such proposed Sale pursuant to this Section 9.6.
9.6.7. Notwithstanding the foregoing provisions of this Section 9.6, no other holder of Units shall have any tag along right pursuant to the provisions of this Section 9.6 with respect to any Transfer of Units by the Fortress Holders:
(a) pursuant to the exercise of their “drag along” rights contained in Section 9.7;
(b) to an Affiliate of any of the Fortress Holders or to partners, members, managing directors and principals of any of the Fortress Holders that is a partnership or limited liability company; provided that such transferee shall agree to be bound by the provisions of this Section 9.6 to the same extent as if such transferee were a Fortress Holder; or
(c) in a Public Sale.
9.6.8. The foregoing provisions of this Section 9.6 shall expire upon the closing of a Qualified Public Offering and shall not apply to any Units which have been Sold in a Public Sale.
Appears in 1 contract
Sources: Agreement of Limited Partnership (Keurig Dr Pepper Inc.)
Tag Along. 9.6.1. If (a) In the Fortress Holders desire event that a Member or Members (collectively, the “Majority Member”) is permitted (pursuant to Section 7.1(a)) and proposes to Transfer 25% or more of their collective Class A Units in a Series (a “Class A Transfer”), or constituting more than 50% of their collective Class C Preferred the total Units or Class D Preferred Units to a third party (the “Tag-Along Transferee”), then the Majority Member shall, at least 45 days prior to the proposed Transfer, give written notice to the other Members (a “Preferred Transfer”), for value to any Prospective Buyer, whether in one bona fide, arm’s length transaction or a series of related contemporaneous or contemporaneously agreed upon transactions and whether to one Prospective Buyer or more than one Prospective Buyer (a “Sale”) such Fortress Holders may only do so in the manner and on the terms set forth in this Section 9.6. Any attempted Transfer of Units subject to this Section 9.6 and not permitted by this Section 9.6 shall be null and void, and the Company and such Series shall not in any way give effect to any such impermissible Transfer.
9.6.2. A written notice (the “Tag Tag-Along Notice”) shall be furnished by describing the Fortress Holders to (i) in the case of a Class A Transfer, each other holder of a Class A Unit of the Series proposed to be sold, and (ii) in the case of a Preferred Transfer, each other holder of a Class C Preferred Unit or Class D Preferred Unit, as the case may be (collectively, the “Tag Along Offerors”), at least 20 business days prior to such Transfer. The Tag Along Notice shall include:
(a) The principal terms of the proposed Sale insofar it relates to Transfer in reasonable detail, including the Units proposed to be so sold (identity of the “Affected Units”) including Tag-Along Transferee, the number of Units to be purchased from sold and the Fortress Holdersproposed closing date, and stating that each of the percentage other Members (each, a “Tag-Along Member”) has the right (the “Tag-Along Right”) to sell to the Tag-Along Transferee the same pro rata portion of its Units as the Majority Member (determined by reference to the relative Units of each such Member and with pro rata cutbacks for all Affected selling Members to the extent that the Tag-Along Transferee is unwilling to acquire all Units held by the Fortress Holders which such number of Units proposed sought to be so purchased constitutes the “Tag Along Sale Percentage,” the expected per Unit purchase price (which, in the case of Class C Preferred Units or Class D Preferred Units, shall be expressed as a specified percentage of the Series 1 Class C Preferred Priority Return (in the case of Class C Preferred Units) or Series 1 Class D Preferred Priority Return (in the case of Class D Preferred Units) of the Units to be soldTransferred), simultaneously with and conditional upon the name closing of such Transfer, on the same pro rata terms and address of conditions as the Prospective Buyer, a good-faith estimate of the amounts described in Section 9.8.4; andMajority Member.
(b) An invitation Each Tag-Along Member may elect to each Tag exercise its Tag-Along Offeror Right by delivering written notice to make the Majority Member and the other Members no later than 30 days after receipt of the Tag-Along Notice (the “Tag-Along Period”). In the event a Tag-Along Member delivers such a notice to the Majority Member prior to the expiration of the Tag-Along Period, such notice shall constitute an offer irrevocable obligation of such Tag-Along Member to include sell its Units to the Tag-Along Transferee in accordance with the Tag-Along Notice. The Majority Member shall give the Tag-Along Members at least ten business days’ notice of the time and place of the closing.
(c) Each Member as part of its participation in the proposed Sale Transfer pursuant to the Prospective Buyer an additional number Tag-Along Right shall convey its Units to the Tag-Along Transferee at the closing, free and clear of Affected Unitsall liens, but only claims and encumbrances and pursuant to such instruments of conveyance and warranties (including warranty of title and absence of encumbrances) as the vested portion of any Company Match Class A Units of such Series (not Tag-Along Transferee shall reasonably request, in any event to exceed the Tag Along Sale Percentage exchange for payment in full of the Affected Units owned by such Tag purchase price set forth in the Tag-Along Offeror) owned by such Tag Notice, and each Tag-Along Offeror, on Member shall enter into agreements with the Tag-Along Transferee containing the same terms and conditions with respect to each Unit sold (subject to Section 9.8), as the Fortress Holders shall Sell each of their Units. Notwithstanding the foregoing, in the event Fortress Holders are Transferring 100% of their collective economic or other rights that comprise their Series Interest in a Series in a Sale, the unvested portion of the Affected Units may be included in such proposed Sale pursuant those applicable to the terms of this Section 9.6.
9.6.3. Within 15 business days after the receipt (in accordance with Section 18.3) of the Tag Along Notice, each Tag Along Offeror desiring to make an offer to include Affected Units in the proposed Sale (each a “Participating Seller” and, together with the Fortress Holders, collectively, the “Tag Along Sellers”), shall send a written offer (the “Tag Along Offer”) to the Fortress Holders specifying the number of Units (not in any event to exceed the Tag Along Sale Percentage of the Affected Units owned by such Participating Seller) which such Participating Seller desires to have included in the proposed Sale. Each Tag Along Offeror who does not return the Tag Along Offer within such 15 business day period shall be deemed to have waived all of such Tag Along Offeror’s rights with respect to such Sale, and the Tag Along Sellers shall thereafter be free to Sell to the Prospective Buyer, at a per Unit price no greater than 105% of the per Unit price set forth in the Tag Along Notice and on other terms which are not materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, without any further obligation to such non-accepting Tag Along Offerors.
9.6.4. The Fortress Holders shall attempt to obtain the inclusion in the proposed Sale of the entire number of Affected Units which the Tag Along Sellers desire to have included in the Sale (as evidenced in the case of the Fortress Holders by the Tag Along Notice and in the case of each Participating Seller by such Participating Seller’s Tag Along Offer). In the event the Fortress Holders shall be unable to obtain the inclusion of such entire number of Affected Units in the proposed Sale, the number of Affected Units to be sold in the proposed Sale by each Tag Along Seller shall be reduced on a pro rata basis according to the proportion which the number of all Affected Units which each such Tag Along Seller desires to have included in the Sale bears to the aggregate number of all Affected Units which all of the Tag Along Sellers desire to have included in the Sale.
9.6.5. The offer of each Participating Seller contained in such Participating Seller’s Tag Along Offer shall be irrevocable, and, to the extent such offer is accepted, such Participating Seller shall be bound and obligated to Sell in the proposed Sale on the same terms and conditions, with respect to each Affected Unit sold (subject to Section 9.8), as the Prospective Selling Holders, up to such number of Affected Units as such Participating Seller shall have specified in such Participating Seller’s Tag Along OfferMajority Member; provided, however, that (a) if except with respect to indemnities for breaches of representations related to title to the principal Tag-Along Member’s Units, each Tag-Along Member shall only be required to participate pro rata in any indemnity given to the Tag-Along Transferee on the same terms as the Majority Member, subject to a maximum indemnity exposure not to exceed the proceeds of the proposed Sale change with the result that the price per Affected Unit sale received by such Tag-Along Member. All Members participating in any such transaction shall be less than 95% bear their pro rata share of the price per Affected Unit set forth in the Tag Along Notice or the other terms reasonable costs of such transaction. Costs incurred by a Member on its own behalf shall not be materially less favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer considered costs of such a transaction and shall be released from such Participating Seller’s obligations thereunder and (b) if, at the end of the 120th day following the date of the effectiveness of the Tag Along Notice (provided, that if the only condition, other than the making of payments or delivery of documents at such closing, to the completion of the proposed Sale is one or more regulatory or governmental approvals or consents, such 120 day period shall automatically be extended for an additional 45 days), the Fortress Holders have not completed the proposed Sale, each Participating Seller shall be permitted to withdraw the offer contained in his Tag Along Offer and shall be released from such Participating Seller’s obligations thereunder, unless the failure to complete such Sale resulted from any failure paid solely by such Participating Seller to comply with the terms of this Section 9.6Member.
9.6.6. If, prior to consummation, the terms of the proposed Sale shall change with the result that the price per Affected Unit to be paid in such proposed Sale shall be greater than 105% of the price per Affected Unit set forth in the Tag Along Notice or the other terms of such proposed Sale shall be materially more favorable to the Tag Along Sellers than those set forth in the Tag Along Notice, the Tag Along Notice shall be null and void, and it shall be necessary for a separate Tag Along Notice to be furnished, and the terms and provisions of this Section 9.6 separately complied with, in order to consummate such proposed Sale pursuant to this Section 9.6.
9.6.7. Notwithstanding the foregoing provisions of this Section 9.6, no other holder of Units shall have any tag along right pursuant to the provisions of this Section 9.6 with respect to any Transfer of Units by the Fortress Holders:
(a) pursuant to the exercise of their “drag along” rights contained in Section 9.7;
(b) to an Affiliate of any of the Fortress Holders or to partners, members, managing directors and principals of any of the Fortress Holders that is a partnership or limited liability company; provided that such transferee shall agree to be bound by the provisions of this Section 9.6 to the same extent as if such transferee were a Fortress Holder; or
(c) in a Public Sale.
9.6.8. The foregoing provisions of this Section 9.6 shall expire upon the closing of a Qualified Public Offering and shall not apply to any Units which have been Sold in a Public Sale.
Appears in 1 contract
Sources: Operating Agreement (Air T Inc)