Protective Provisions. 10.1 Approval of Series A Preference Shares, Series B Preference Shares, Series D Preference Shares. For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events), in addition to any other vote or consent required elsewhere in the Memorandum and Articles or by applicable Law, the Company shall not, and Members of the Company shall procure that the Company and each of its Subsidiaries shall not (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take any of the following actions (other than those in connection with a Non-Liquidation M&A) without the prior vote or written consent of the holders of at least 50% of the then outstanding Series D Preference Shares, the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference Shares, each voting separately as a single class. (a) to liquidate, dissolve or wind up the affairs of the Company, or effect any Liquidating Transaction; (b) to amend, alter, or repeal any provision of the Memorandum and Articles; (c) to create or authorize the creation of or issue any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, or increase the authorized number of shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015; (d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement); (e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015; (f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director; (g) to increase or decrease the size of the Board; (h) to approve any change in the business scope or activities of the Company; (i) to take actions subject to other protective provisions to be set forth in the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financing; (j) to approve and change any compensation package of the management of the Company, including but not limited to the chief executive officer, general manager, and any other key employee; and (k) to agree or undertake to do any of the foregoing.
Appears in 2 contracts
Sources: Shareholder Agreement, Shareholder Agreement (iClick Interactive Asia Group LTD)
Protective Provisions. 10.1 Approval of Series A Preference SharesThe Partnership and the General Partner hereby covenant and agree that, Series B Preference Shares, Series D Preference Shares. For so for as long as Bertelsmannany Preferred Units are outstanding, Sumitomo and BlueFocus respectively holds no less than 448,801 Sharesneither the Partnership nor the General Partner shall, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events)Partnership and the General Partner shall cause their respective Subsidiaries not to, in addition to any other vote undertake or consent required elsewhere in the Memorandum and Articles or by applicable Law, the Company shall not, and Members of the Company shall procure that the Company and each of its Subsidiaries shall not (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take permit any of the following actions (other than those in connection with a Non-Liquidation M&A) actions, directly or indirectly, without the prior vote or written consent of the holders of at least 50% of the then outstanding Series D Preference Shares, the holders record of at least 50% a majority of the Preferred Units then outstanding Series B Preference Shares and outstanding:
(1) in the holders of at least 50% case of the then outstanding Series A Preference SharesPartnership, each voting separately as a single class.
(a) to liquidate, dissolve authorize or wind up the affairs of the Company, or effect any Liquidating Transaction;
(b) to amend, alter, or repeal any provision of the Memorandum and Articles;
(c) to create or authorize the creation of or issue any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Sharesissue, or increase the authorized number of shares or issued amount of, (A) equity securities ranking, as to distributions and upon liquidation, on a parity with or senior to the Preferred Units or (B) Common Units or other equity securities ranking, as to distributions and upon liquidation, junior to the Preferred Units, to the extent that such Common Units or other junior equity securities contain any rights that restrict in any way management of the Series A Preference SharesPartnership, the Series B Preference Shares General Partner or their respective Subsidiaries or would reasonably be expected to interfere with the Preferred Units or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding rights of the holders thereof; and (2) in the case of the Series A Preference SharesGeneral Partner, any Subsidiary of the General Partner or any Subsidiary of the Partnership, authorize or issue additional (A) shares of preferred stock or preferred equity securities or (B) shares of common stock or common equity securities or other equity securities ranking, as to distributions and upon liquidation, junior to shares of such entity’s preferred stock or preferred equity securities, to the extent that such shares of common stock, common equity securities or other junior equity securities contain any rights that restrict in any way management of the General Partner, the Series B Preference Shares Partnership or their respective Subsidiaries or would reasonably be expected to interfere with the Preferred Units or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from rights of the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015holders thereof;
(dii) to createamend, alter, repeal or issue waive any of the provisions of (1) this Amendment or the Purchase Agreement or (2) the certificate of limited partnership of the Partnership, the Partnership Agreement, the Articles of Incorporation or bylaws of the General Partner or the organizational documents of any debenture of their respective Subsidiaries, in the case of clause (2) only, to the extent that such amendment would reasonably be expected to adversely affect the Preferred Units or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares the rights of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement)holders thereof;
(eiii) to redeem, purchase or redeem otherwise acquire for any consideration (1) in the case of the Partnership, equity securities of the Partnership that rank, as to distributions and upon liquidation, junior to the Preferred Units, including Common Units, and (2) in the case of the General Partner, any Subsidiary of the General Partner or pay any dividend on Subsidiary of the Partnership, any class or series of capital stock prior or equity securities; provided, that the foregoing shall not prohibit the following: (A) redemptions pursuant to the Series A Preference Shares, Share Redemption Program; and (B) redemptions of Common Units in exchange for which the Series B Preference General Partner issues REIT Shares or to the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with holders of such Common Units as the cessation sole consideration therefor pursuant to the terms of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015Partnership Agreement;
(fiv) to create or authorize the creation engage in a Change of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D DirectorControl;
(gv) commence or suffer to increase exist an Event of Bankruptcy as to the Partnership, the General Partner or decrease the size any of the Boardtheir respective Subsidiaries;
(hvi) to approve pay any change special distributions (which, for purposes hereof, shall mean any distribution other than a distribution made on a regular monthly basis consistent with past practice) on (1) in the business scope or activities case of the Company;Partnership, Common Units or other equity securities that rank, as to distributions and upon liquidation, junior to the Preferred Units and (2) in the case of the General Partner, any Subsidiary of the General Partner or any Subsidiary of the Partnership, shares of common stock or common equity securities or other equity securities that rank, as to distributions and upon liquidation, junior to such entity’s shares of preferred stock or preferred equity securities; provided, that the foregoing shall not prohibit special distributions that are necessary to preserve the General Partner’s status as a REIT under the Code; or
(ivii) to take actions subject to engage in a recapitalization, reorganization, merger, unit or stock split, statutory unit or stock exchange, sale of all or substantially all of such entity’s assets, tender offer for all or substantially all of its Common Units, shares of common stock or other protective provisions to be set forth in common equity securities, as the definitive agreements in connection with case may be, or other similar transaction. Neither the Series A financing, Partnership nor the Series B financing or the Series D financing;
(j) to approve and change any compensation package of the management of the Company, including but not limited to the chief executive officer, general managerGeneral Partner shall take, and shall cause their respective Subsidiaries not to take, any other key employee; and
(k) to agree or undertake to do action in furtherance of any of the foregoingforegoing actions without obtaining the required consent therefor, as specified in this Section 7(a). Notwithstanding any provision in this Section 7(a) to the contrary, the Partnership shall be able to enter into tax protection agreements in the ordinary course of its business.
Appears in 2 contracts
Sources: Limited Partnership Agreement (Strategic Storage Trust VI, Inc.), Limited Partnership Agreement (Strategic Storage Trust II, Inc.)
Protective Provisions. 10.1 Approval of (a) For so long as the Series A Preference D-1 Preferred Shares, the Series D Preferred Shares, the Series C Preferred Shares, Series B Preference Preferred Shares, the Series D Preference Shares. For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 B-1Preferred Shares and 808,835 or Series A Preferred Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization as the case may be) remain issued and the like events)outstanding, in addition to any other vote or consent required elsewhere requirements set forth in the Memorandum and Restated Articles or by applicable Lawthe Laws of the Cayman Islands, the Company and each member of the Group Companies shall not, and Members of the Company shall procure that the Company and the Founders shall cause each member of its Subsidiaries the Group Companies and the Founder Holdcos not to (by way of shareholders resolutions, board resolutions or other means), without (i) the prior approval of the Series A Investors who hold at least a majority of the then issued and outstanding Series A Preferred Shares; (ii) the prior approval of the Series B Investors who hold at least a majority of the then issued and outstanding Series B Preferred Shares; (iii) the prior approval of the Series B-1 Investors who hold at least a majority of the then issued and outstanding Series B-1 Preferred Shares; (iv) the prior approval of the Series C Investors who hold at least a majority of the then issued and outstanding Series C Preferred Shares; and (v) the prior approval of the Series D and Series D-1 Investors who hold at least a majority of the then issued and outstanding Series D and Series D-1 Preferred Shares, take any action that would (for the purpose of this Section 15.8, the term for the Company below shall not also include the members of the Group Companies):
(directly i) alter, amend or change the rights, preferences or privileges of, or the restrictions provided for the benefit of, the Preferred Shares, whether such amendment or change is absolute or in relation to other classes of shares, including without limitation, the authorization of creation or issuance (by amendmentreclassification, merger, consolidation, amalgamation, scheme of arrangement subsequent financing or otherwise) take of any new class or series of shares that have rights, preferences or privileges senior to or on a parity with the following actions (other than those in connection with a Non-Liquidation M&A) without the prior vote or written consent of the holders of at least 50% of the then outstanding Series D Preference Preferred Shares, the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference Shares, each voting separately as a single class.
(a) to liquidate, dissolve or wind up the affairs of the Company, or effect any Liquidating Transaction;
(bii) to amend, alter, or repeal any provision of the Memorandum and Articles;
(c) to create or authorize the creation of or issue (by reclassification or otherwise) any new class or series of shares or any other security convertible into or exercisable for any equity security, security having rights, preferences or privileges senior to or on parity with the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Preferred Shares, or increase the authorized number of shares of the Series A Preference Preferred Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(diii) to create, or issue result in any new issuance of any debenture equity securities of the Company and/or any of its Subsidiaries to the Founders or to any obligation convertible intothird party, excluding (1) any securities convertible intoissuance of Ordinary Shares upon conversion of the Preferred Shares, any option to purchase and (2) the issuance of Ordinary Shares (or subscribe for, options or warrants exercisable for, therefor) under employee equity incentive plans approved by the Board;
(iv) result in the payment or declaration of any dividend on any Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement)Company;
(ev) to purchase or redeem or pay any dividend on any capital stock shares prior to the Series A Preference Preferred Shares, excluding the Series B Preference Shares or the Series D Preference Shares (other than stock shares repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(fvi) to create or authorize the creation of any debt security that is not already included in a Board-approved budget (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, Board of Directors (including the approval of the Series A Director, the Series B Director and the Series D C Director;); and
(gvii) to increase or decrease the size of the BoardBoard of Directors.
(b) In respect of the following act of Company which is required under the statue of the Cayman Islands to be taken by a special resolution of the shareholders may be effected by a special resolution of the shareholders, provided, the holder(s) of Series A Preferred Shares who hold at least a majority of the then issued and outstanding Series A Preferred Shares and vote against the resolution, holder(s) of Series B Preferred Shares who hold at least a majority of the then issued and outstanding Series B Preferred Shares and vote against the resolution, holder(s) of Series B-1 Preferred Shares who hold at least a majority of the then issued and outstanding Series B-1 Preferred Shares and vote against the resolution, holder(s) of Series C Preferred Shares who hold at least a majority of the then issued and outstanding Series C Preferred Shares and vote against the resolution, or holder(s) of Series D and Series D-1 Preferred Shares who hold at least a majority of the then issued and outstanding Series D and Series D-1 Preferred Shares and vote against the resolution, as the case may be, shall have the number of votes equal to (i) the votes of all shareholders who vote in favor of the resolution, plus (ii) one:
(i) amend or waive any provision of the Company’s Restated Articles in a manner that would alter, amend or change the rights, preferences or privileges of, or the restrictions provided for the benefit of, the Preferred Shares;
(hii) to approve increase, reduce or cancel the registered capital of Company and/or any of its Subsidiaries or carrying a right of subscription in respect of equity interest or issue any options rights or warrants or which may require the change of shareholding in the business scope future or activities do any act which has the effect of diluting or reducing the effective shareholding of the Series A Investors, the Series B Investors, the Series B-1 Investors, the Series C Investors, the Series D Investors or the Series D-1 Investor in the Company;
(iiii) to take actions subject to other protective provisions to be set forth pass any resolution for the liquidation, dissolution or winding up of the Company and/or any of its Subsidiaries or undertake any merger, reconstruction or liquidation exercise concerning the Company and/or any Subsidiary or apply for the appointment of a receiver, manager or judicial manager or like officer, or effect any Deemed Liquidation Event (as defined in the definitive agreements in connection with Restated Articles).
(c) Without the consent of the Board of Directors, including the Series A financingDirector, the Series B financing or Director and the Series D financingC Director, the Company and/or any of its Subsidiaries shall not effect or validate any of the following actions (either directly or by amendment, merger, consolidation, or otherwise):
(i) cease to conduct or carry on the business of the Company and/or any of its Subsidiaries substantially as now conducted, change any part of its business activities, or conduct or carry on any new business;
(jii) to approve and change any compensation package sell or dispose of the management whole or a substantial part of the undertaking goodwill or the assets of the Company and/or any of its Subsidiaries;
(iii) borrow any money or obtain any financial facilities except pursuant to trade facilities obtained from banks or other financial institutions in the ordinary course of business;
(iv) make any loan or advance to, or own any stock or other securities of, any subsidiary or other corporation, partnership, or other entity which exceeds US$500,000 each, unless it is wholly owned by the Company;
(v) make any loan or advance to any individual Person, including any employee or director of the Group Companies, which exceeds US$500,000, except those advances or similar expenditures in the ordinary course of business or under the terms of an employee stock or option plan approved by the Board of Directors;
(vi) incorporate Subsidiaries and branches, make investment in exceeding of US$200,000 within twelve (12) consecutive months, purchase fixed assets or build real estates, and acquire all or part of the equity interest of other companies by the Company and/or any of its Subsidiaries;
(vii) appoint, fire, change the compensation of, or settle the terms of appointment of any president (general manager), vice president (deputy general manager), chief financial officer (financial controller and/or financial manager) or any other senior managers ranked as the vice president level or above (including but not limited to the chief executive officer, general managerchief operating officer, chief financial officer, chief technology officer and chief marketing officer), including approving any option plan;
(viii) approve or make adjustments or modifications to terms of transactions involving the interest of any director or shareholder of the Company and/or any of its Subsidiaries, including but not limited to the making of any loans or advances, whether directly or indirectly, or the provision of any guarantee, indemnity or security for or in connection with any indebtedness of liabilities of any director or shareholder of the Company and/or any of its Subsidiaries;
(ix) guarantee any indebtedness which exceeds US$500,000 each except for trade accounts of the Company or any of its Subsidiaries arising in the ordinary course of business;
(x) incur any aggregate indebtedness in excess of US$500,000 each that is not already included in a Board-approved budget, other than trade credit incurred in the ordinary course of business;
(xi) enter into or be a party to any transaction or series of transactions between each Group Company and any shareholder, director, senior manager or employee of each Group Company or any Affiliate of any Group Company or any “associate” (as defined in Rule 12b-2 promulgated under the Exchange Act) of any Group Company, or between each Group Company and any shareholder, director, senior manager or employees of the Affiliate in an amount more than US$50,000 within twelve (12) consecutive months, except transactions made in the ordinary course of business and pursuant to reasonable requirements of the Company’s business and upon fair and reasonable terms that are approved by a majority of the Board of Directors;
(xii) approve the annual operation plan and budget of the Company and/or any of its Subsidiaries or any material change of such annual operation plan, budget or the business scope of the Company and/or any of its Subsidiaries;
(xiii) establish the employee equity incentive plans for the management and/or employees of the Company and/or any of its Subsidiaries;
(xiv) make any investment other key employeethan investments in prime commercial paper, money market funds, certificates of deposit in any international bank having a net worth in excess of US$100,000,000 or obligations issued or guaranteed by the United States or other sovereign government, in each case having a maturity not in excess of two years;
(xv) sell, transfer, license, pledge or encumber technology or intellectual property, other than the licenses granted in the ordinary course of business; and
(kxvi) to agree or undertake to do any matters that shall be unanimously approved by all the Board of the foregoingCompany according to applicable Laws.
Appears in 2 contracts
Sources: Shareholder Agreement (CooTek(Cayman)Inc.), Shareholder Agreements (CooTek(Cayman)Inc.)
Protective Provisions. 10.1 Approval of Series A Preference Shares, Series B Preference Shares, Series D Preference Shares. For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events), in In addition to any such other vote or consent required elsewhere limitations as may be provided in the Memorandum and Articles or by applicable Lawand the BVI Business Companies ▇▇▇ ▇▇▇▇, the Company shall not, and Members shall cause the other Group Companies to not, and the holders of Ordinary Shares shall exercise all of their rights with respect to such Ordinary Shares so as to cause the Company shall procure that the Company and each of its Subsidiaries shall not (directly Group Companies to not, effect or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take otherwise consummate any of the following actions (other than those in connection with a Non-Liquidation M&A) acts without first obtaining.
7.1 the prior vote or written consent approval of (i) the holders(s) of at least 75% of the holders outstanding Series A Shares and Series A1 Shares (in aggregate and on an as-converted basis), and (ii) the holder(s) of at least 50% of the then outstanding Series D Preference Shares, the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference Shares, each voting separately (on an as converted basis); provided that such requirement shall terminate upon a single class.Qualified Public Offering:
(a) to liquidate, dissolve any amendment or wind up the affairs change of the Companyrights, preferences, privileges or powers of, or effect any Liquidating Transaction;
(b) to amend, alter, or repeal any provision of the Memorandum and Articles;
(c) to create or authorize restrictions provided for the creation of or issue any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Sharesbenefit of, the Series B Preference Preferred Shares or the Series D Preference Shares, or increase the authorized number of shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(b) any action to authorize, create or issue shares of any class or series of the Company having preferences superior to or on a parity with the Preferred Shares in any aspects including without limitation, dividend rights, redemption rights and/or liquidation tights;
(c) any new issuance of any equity securities of the Company, including any change in the total number of authorized Series B Shares, but excluding (i) to take actions subject to other protective provisions to be set forth in the definitive agreements in connection with the Series A financing, any issuance of the Series B financing Shares authorized under the Purchase Agreement (ii) any issuance of Ordinary Shares upon conversion of the Preferred Shares, (iii) the issuance of 66,580 Ordinary Shares upon the exercise of the option currently held by Winsome Group Limited on behalf of Ma ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ Ho, Ma Wen Lie, ▇▇▇▇ Lo Yin, Li Jin and other officers, employees and advisors of the Company, and (iv) the issuance of up to 151,430 Ordinary Shares (or options or warrants therefor) pursuant to employee equity incentive plans approved by the Series D financingCompensation Committee;
(d) any action of the Company to reclassify any outstanding shares into shares having preferences or priority as to dividends or assets senior to or on a parity with the preference of the Preferred Shares;
(e) any increase or decrease of the authorized number of Ordinary Shares or Preferred Shares of the Company;
(f) any amendment of the Memorandum and Articles of Association or other charter documents of the Company (including any Major Subsidiary);
(g) any merger or consolidation of the Company (including any Subsidiary) with or into any other business entity in which the shareholders of the Company (including any Subsidiary) immediately after such merger or consolidation held shares representing less than a majority of the voting power of the outstanding share capital of the surviving business entity;
(h) any transaction or series of transactions that would result in a change of control of the Company (including any Subsidiary);
(i) the sale, lease, transfer or other disposition of all or substantially all of the assets of the Company (including any Subsidiary), except for intra-group transactions among the Company and any Subsidiaries;
(j) to approve and change any compensation package licensing or other transfer of the management patents, copyrights, trademarks or other intellectual property of the CompanyCompany (including any Subsidiary) other than in the ordinary course of its business, including but not limited to except for intra-group transactions among the chief executive officer, general manager, Company and any other key employee; andSubsidiaries;
(k) any increase or decrease of the authorized number of the Board (including any committees of the Board) of the Company;
(l) effect a liquidation, dissolution or winding up of the Company (including any Subsidiary);
(m) the declaration or payment of a dividend or other distribution on Ordinary Shares or Preferred Shares of the Company;
(n) any increase of the number of Ordinary Shares of the Company reserved under any employee equity incentive plan;
(o) any increase in compensation of any employee of the Company (including any Subsidiary) with an annual salary of US$50,000 or more by more than 20% in a twelve (12) month period;
(p) the extension by the Company of any loan or guarantee for indebtedness to agree any director officer, employee or undertake affiliate of the Company (including any Subsidiary), except for intra-group transactions among the Company and any Subsidiaries;
(q) any incurrence of indebtedness in excess of US$1,000,000 in the aggregate to do the Company (including any Subsidiary), or creation of any encumbrance whatsoever upon the assets, patents, copyrights, trademarks or other intellectual property of the Company (including any Subsidiary);
(r) any purchase by the Company (including any Subsidiary) of real property with a value of US$1,000,000 or more, or any purchase of production facilities with a value of US$500,000 or more, individually or in the aggregate;
(s) any transaction or series of transactions that are not in the ordinary course of the Company’s business where the value involved exceeds US$1,000,000, individually or in the aggregate, during any twelve (12) month period;
(t) approval of the annual consolidated budget of the Company;
(u) the appointment and removal of any key officer of the Company (including any Major Subsidiary), including the Chief Executive Officer and the Chief Financial Officer;
(v) the appointment and/or reappointment of auditors of the Company; or
(w) any transaction involving both the Company (including any Subsidiary) and a shareholder of any Group Company or any of the foregoingCompany’s employees, officers, directors or shareholders or any affiliate of a shareholder of any Group Company or any of such affiliate’s officers, directors or shareholders, except for intra-group transactions among the Company and any Subsidiaries and employment contracts between a Group Company and its employees that are not otherwise subject to this Section 7, and
7.2 the prior written approval of the holder(s) as at the date hereof (taking no account of any share issuances after the date, hereof) of at least 96% of the aggregate of Ordinary Shares and Preferred Shares (on an as-converted basis), provided that such requirement shall terminate upon a Qualified IPO, any repurchase or redemption of any equity securities of the Company other than (A) pursuant to contractual rights to repurchase Ordinary Shares from the employees, directors or consultants of the Company upon termination of their employment or services or (B) pursuant to a contractual right of first refusal held by the Company. Provided, however that, to the extent that the applicable laws prevent the Company from being bound by any of the above provisions, such provisions shall be binding as amongst the parties hereto (other than the Company) and such parties shall take all actions necessary to give effect to such provisions.
Appears in 1 contract
Protective Provisions. 10.1 Approval of Series A Preference SharesThe Partnership and the General Partner hereby covenant and agree that, Series B Preference Shares, Series D Preference Shares. For so for as long as Bertelsmannany Preferred Units are outstanding, Sumitomo and BlueFocus respectively holds no less than 448,801 Sharesneither the Partnership nor the General Partner shall, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events)Partnership and the General Partner shall cause their respective Subsidiaries not to, in addition to any other vote undertake or consent required elsewhere in the Memorandum and Articles or by applicable Law, the Company shall not, and Members of the Company shall procure that the Company and each of its Subsidiaries shall not (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take permit any of the following actions (other than those in connection with a Non-Liquidation M&A) actions, directly or indirectly, without the prior vote or written consent of the holders of at least 50% of the then outstanding Series D Preference Shares, the holders record of at least 50% a majority of the Preferred Units then outstanding Series B Preference Shares and outstanding:
(1) in the holders of at least 50% case of the then outstanding Series A Preference SharesPartnership, each voting separately as a single class.
(a) to liquidate, dissolve authorize or wind up the affairs of the Company, or effect any Liquidating Transaction;
(b) to amend, alter, or repeal any provision of the Memorandum and Articles;
(c) to create or authorize the creation of or issue any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Sharesissue, or increase the authorized number or issued amount of, (A) equity securities ranking, as to distributions and upon liquidation, on a parity with or senior to the Preferred Units or (B) Common Units or other equity securities ranking, as to distributions and upon liquidation, junior to the Preferred Units, to the extent that such Common Units or other junior equity securities contain any rights that restrict in any way management of the Partnership, the General Partner or their respective Subsidiaries or would reasonably be expected to interfere with the Preferred Units or the rights of the holders thereof; and (2) in the case of the General Partner, any Subsidiary of the General Partner or any Subsidiary of the Partnership, authorize or issue additional (A) shares of preferred stock or preferred equity securities or (B) shares of common stock or common equity securities or other equity securities ranking, as to distributions and upon liquidation, junior to shares of such entity's preferred stock or preferred equity securities, to the extent that such shares of common stock, common equity securities or other junior equity securities contain any rights that restrict in any way management of the General Partner, the Partnership or their respective Subsidiaries or would reasonably be expected to interfere with the Preferred Units or the rights of the holders thereof;
(ii) amend, alter, repeal or waive any of the provisions of (1) this Amendment or the Purchase Agreement or (2) the certificate of limited partnership of the Partnership, the Partnership Agreement, the Articles of Incorporation or bylaws of the General Partner or the organizational documents of any of their respective Subsidiaries, in the case of clause (2) only, to the extent that such amendment would reasonably be expected to adversely affect the Preferred Units or the rights of the holders thereof;
(iii) redeem, purchase or otherwise acquire for any consideration (1) in the case of the Partnership, equity securities of the Partnership that rank, as to distributions and upon liquidation, junior to the Preferred Units, including Common Units, and (2) in the case of the General Partner, any Subsidiary of the General Partner or any Subsidiary of the Partnership, any class or series of capital stock or equity securities; provided, that the foregoing shall not prohibit the following: (A) redemptions pursuant to the Share Redemption Program; and (B) redemptions of Common Units in exchange for which the General Partner issues REIT Shares to the holders of such Common Units as the sole consideration therefor pursuant to the terms of the Partnership Agreement;
(iv) engage in a Change of Control;
(v) commence or suffer to exist an Event of Bankruptcy as to the Partnership, the General Partner or any of their respective Subsidiaries;
(vi) pay any special distributions (which, for purposes hereof, shall mean any distribution other than a distribution made on a regular monthly basis consistent with past practice) on (1) in the case of the Partnership, Common Units or other equity securities that rank, as to distributions and upon liquidation, junior to the Preferred Units and (2) in the case of the General Partner, any Subsidiary of the General Partner or any Subsidiary of the Partnership, shares of common stock or common equity securities or other equity securities that rank, as to distributions and upon liquidation, junior to such entity's shares of preferred stock or preferred equity securities; provided, that the foregoing shall not prohibit (A) special distributions that are necessary to preserve the General Partner's status as a REIT under the Code; and (B) distributions to the General Partner's stockholders paid in shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;General Partner's common stock; or
(dvii) to createengage in a recapitalization, reorganization, merger, unit or stock split, statutory unit or stock exchange, sale of all or substantially all of such entity's assets, tender offer for all or substantially all of its Common Units, shares of common stock or other common equity securities, as the case may be, or issue of any debenture or any obligation convertible intoother similar transaction. Neither the Partnership nor the General Partner shall take, and shall cause their respective Subsidiaries not to take, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares action in furtherance of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(i) to take actions subject to other protective provisions to be set forth in the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financing;
(j) to approve and change any compensation package of the management of the Company, including but not limited to the chief executive officer, general manager, and any other key employee; and
(k) to agree or undertake to do any of the foregoingforegoing actions without obtaining the required consent therefor, as specified in this Section 7(a). Notwithstanding any provision in this Section 7(a) to the contrary, the Partnership shall be able to enter into tax protection agreements in the ordinary course of its business.
Appears in 1 contract
Sources: Limited Partnership Agreement (Griffin Capital Essential Asset REIT II, Inc.)
Protective Provisions. 10.1 Approval of So long as the Series A Preference Shares, Series B Preference Shares, Series D Preference Shares. For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares Preferred Stock represents a minimum of twenty percent (subject to adjustments made for share split, subdivision, consolidation, reorganization and 20%) of the like events), in addition to any other vote or consent required elsewhere in outstanding capital stock of the Memorandum and Articles or by applicable LawCorporation, the Company Corporation shall not, and Members of the Company shall procure that the Company and each of its Subsidiaries shall not (directly or in any case, by amendment, merger, consolidation, amalgamation, scheme operation of arrangement law or otherwise) take any ), without first having provided written notice of such proposed action to each holder of outstanding shares of the following actions (other than those in connection with a Non-Liquidation M&A) without Series A Preferred Stock and having obtained the prior vote or written consent approval of the holders of at least 50% a majority of the then outstanding shares of Series D Preference SharesA Preferred Stock, given in writing or by consent or vote at a meeting:
(1) altering, changing or amending the preferences, privileges or rights of the Series A Preferred Stock or the Certificate of Incorporation or Bylaws in a manner which is adverse to the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference Shares, each voting separately as a single class.
(a) to liquidate, dissolve or wind up the affairs of the Company, or effect any Liquidating TransactionPreferred;
(b2) to amend, alter, increase or repeal any provision of the Memorandum and Articles;
(c) to create or authorize the creation of or issue any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, or increase decrease the authorized number of shares of any series of Preferred Stock;
(3) approve any transaction or series of transactions deemed to be a liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary;
(4) approve any Deemed Liquidity Event or other corporate reorganization or acquisition; or
(5) declare or pay any dividend or distribution or approve any repurchase with respect to the Series A Preference SharesPreferred (except as otherwise provided in Section 2 above) or the Common Stock (other than required redemptions and repurchases under restricted stock agreements or stock option agreements with employees, advisors, consultants and others and other arrangements approved by the Board of Directors). Further, the Series B Preference Shares Corporation shall not, by amendment, alteration or repeal of this Certificate of Incorporation (whether by merger, consolidation, operation of law, or otherwise) or through any Deemed Liquidity Event, or any other reorganization, recapitalization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities, agreement or any other voluntary action, avoid or seek to avoid the Series D Preference Shares observance or do performance of any act which has of the effect terms to be observed or performed hereunder by the Corporation and shall at all times in good faith assist in the carrying out of diluting all the provisions of this Section 4(d) and in the taking of all such action as may be necessary or reducing appropriate in order to protect the effective shareholding rights of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval each series of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(i) to take actions subject to other protective provisions to be set forth in the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financing;
(j) to approve and change any compensation package of the management of the Company, including but not limited to the chief executive officer, general manager, and any other key employee; and
(k) to agree or undertake to do any of the foregoingPreferred Stock against impairment.
Appears in 1 contract
Sources: Series a Preferred Stock Subscription Agreement (iSpecimen Inc.)
Protective Provisions. 10.1 Approval Unless the directors designated by the holders of the shares of the Series A Preference SharesPreferred Stock originally issued under the Purchase Agreement control the Board of Directors of the Company with respect to all actions, Series B Preference Shares, Series D Preference Shares. For for so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and any shares of the like events), in addition to any other vote or consent required elsewhere in Series A Preferred Stock originally issued under the Memorandum and Articles or by applicable LawPurchase Agreement remain outstanding, the Company shall not, and Members of the Company shall procure that the Company and each of cause its Subsidiaries shall subsidiaries not (directly or by amendmentto, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take any of the following actions (other than those in connection with a Non-Liquidation M&A) without the prior vote or written consent approval of the holders of at least 5075% of the then outstanding Series D Preference Shares, the holders of at least 50% shares of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference Shares, each voting separately as a single class.Preferred Stock originally issued under the Purchase Agreement then outstanding:
(a) to liquidate, dissolve amend the charter or wind up the affairs bylaws in any manner that would alter or change any of the Companyrights, preferences, privileges or effect any Liquidating Transactionrestrictions of the Series A Preferred Stock or the Preferred Stock Conversion Shares (as defined in the Purchase Agreement);
(b) to amend, alter, or repeal reclassify any provision of the Memorandum and Articles;
(c) to create or authorize the creation of or issue any other security convertible outstanding securities into or exercisable for any equity security, securities having rights, preferences or privileges senior to to, or on a parity with with, the Series A Preference Shares, the Series B Preference Shares Preferred Stock;
(c) authorize or issue any additional shares of capital stock (other than to Purchaser in accordance with this Agreement or the Series D Preference Shares, Purchase Agreement);
(d) merge or increase the authorized number consolidate with or into any corporation or other Person; Investor’s Rights Agreement (ITEK) v4
(e) sell all or substantially all their respective assets in a single transaction or series of shares related transactions;
(f) license all or substantially all of the Series A Preference Shares, the Series B Preference Shares their respective intellectual property in a single transaction or the Series D Preference Shares series of related transactions;
(g) liquidate or do dissolve; or
(h) alter any act which has the effect of diluting or reducing the effective shareholding rights of the holders of the Series A Preference Shares, the Series B Preference Shares Preferred Stock or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease change the size of the Board;
(h) to approve any change in the business scope or activities Board of the Company;Directors.
(i) declare or pay any dividends (other than dividends payable to take actions subject to the Company or its subsidiaries) on or declare or make any other protective provisions to be set forth in the definitive agreements in connection with the Series A financingdistribution, the Series B financing directly or the Series D financingindirectly, on account of any shares of Common Stock now or hereafter outstanding;
(j) to approve and change repurchase any compensation package outstanding shares of capital stock (other than repurchases or redemptions of the management Series A Preferred Stock in accordance with its terms);
(k) approve or modify by 10% or more the aggregate amount of any annual or other operating or capital budget, or approve or modify by 50% or more any single line item of any such operating or capital budget;
(l) increase the salary of any officer or employee or pay any bonus to any officer, director or employee not contemplated in a budget or bonus plan approved by directors designated by the holders of the shares of the Series A Preferred Stock originally issued under the Purchase Agreement then outstanding;
(m) retain, terminate or enter into any salary or employment negotiations or employment agreement with any employee or any future employee;
(n) incur indebtedness (other than trade payables) or enter into contracts or leases that require payments in excess of $5,000 in the aggregate;
(o) make or incur any single capital expenditure;
(p) award stock options, stock appreciation rights or similar employee benefits or determine vesting schedules, exercise prices or similar features;
(q) make any material change in the nature of its business or enter into any new line of business, joint venture or similar arrangement;
(r) pledge its assets or guarantee the obligations of any other individual or entity;
(s) recommend approval of any new equity incentive plan;
(t) form or acquire any subsidiary, joint venture or similar business entity; or Investor’s Rights Agreement (ITEK) v4
(u) directly or indirectly enter into, or permit to exist, any material transaction with any affiliate of the Company, including but not limited any Founder or any affiliate of a Founder, or transfer, pay, loan or otherwise obligate the Company to the chief executive officergive cash, general managerservices, and assets or other items of value to affiliates, Founders or any other key employee; and
(k) to agree affiliate of a Founder or undertake commit to do any of the foregoingpreceding after the date hereof, except for employee compensation or for reimbursement of ordinary business expenses.
Appears in 1 contract
Protective Provisions. 10.1 Approval 3.2.1 At any time when any Convertible Preferred Shares remain outstanding, the Company shall not, either directly or indirectly (including through a subsidiary) by amendment, merger, consolidation or otherwise, do any of Series A Preference Shares, Series B Preference Shares, Series D Preference Shares. For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares the following without (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events), in addition to any other vote required by law or consent required elsewhere in the Memorandum and Articles (or by applicable Law, the Company shall not, and Members any certificate of designation relating to any series of the Company shall procure that the Company and each of its Subsidiaries shall not (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwisePreferred Shares)) take any of the following actions (other than those in connection with a Non-Liquidation M&A) without the prior vote or written consent of the holders of at least 50% two-thirds of the then outstanding Series D Preference Convertible Preferred Shares (and for the avoidance of doubt, any of the actions prohibited by or taken in contravention of this Section 3.2.1 shall be ultra ▇▇▇▇▇, null and void ab initio and of no force or effect) (provided, that this Section 3.2.1 shall not prohibit the Company from effecting a transaction solely to change the domicile of the holding company of the Company and its subsidiaries to the state of Delaware so long as (x) the Convertible Preferred Shares, the holders Ordinary Shares and any other classes or series of at least 50% shares of the then Company outstanding Series B Preference Shares immediately prior to such transaction are exchanged for preferred stock in such holding company having powers, rights, preferences, privileges and the holders of at least 50% restrictions substantially identical to those of the then outstanding Series A Preference Convertible Preferred Shares, each voting separately Ordinary Shares or such other classes or series, as the case may be, immediately prior to such transaction, (y) there is no other class or series of shares or other equity securities in such holding company outstanding immediately following such transaction and (z) and such holding company is a single class.Delaware corporation):
(a) to liquidate, dissolve or wind up the affairs of the Company, or effect any Liquidating Transaction;
(b) to amend, alter, alter or repeal any provision of the Memorandum and Articles;
Articles (cor any certificate of designation relating to any series of Preferred Shares), as then in effect, in a manner adverse to the powers, rights, preferences, restrictions or privileges of the Convertible Preferred Shares; (b) (i) issue Convertible Preferred Shares (or any securities convertible into or exercisable or exchangeable for Convertible Preferred Shares) after the Original Issue Date, (ii) without limiting clause (v) below, issue any Preferred Shares (other than Convertible Preferred Shares) unless the Articles are first amended to amend Article 8.1 thereof in a manner reasonably acceptable to holders of at least 2/3 of the then-outstanding Convertible Preferred Shares; (iii) increase the authorized number of Convertible Preferred Shares; (iv) reclassify any Ordinary Shares or Preferred Shares to give those shares a preference or priority as to dividends or assets or property superior to any existing series of Preferred Shares; or (v) create or authorize the creation of of, increase the authorized amount of, or allot or issue (A) any other class or series of shares that have, or any security convertible into or exercisable or exchangeable for any equity securityclass or series of shares where the underlying shares have, having rights, preferences or privileges that are senior to to, superior to, or on parity, in any respect, with the Convertible Preferred Shares (provided, however that, for the avoidance of doubt, Ordinary Shares or securities that are convertible or exchangeable into Ordinary Shares shall not be deemed on parity with the Series A Preference Shares, Convertible Preferred Shares solely because the Series B Preference Convertible Preferred Shares vote with or participate in dividends and distributions with the Series D Preference Shares, Ordinary Shares on an as-converted basis) or increase the authorized number (B) any class or series of shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe that provide for, or warrants any security convertible into or exercisable or exchangeable for any class or series of shares where the underlying shares provide for, Shares mandatory redemption or repurchase of such shares by the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to excluding, for the Series A Preference Sharesavoidance of doubt, the Series B Preference conversion of such shares into Ordinary Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(i) to take actions subject to other protective provisions deemed to be set forth in the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financing;
(j) to approve and change any compensation package a repurchase of the management of the Company, including but not limited to the chief executive officer, general manager, and any other key employeesuch converted shares); and
(k) to agree or undertake to do any of the foregoing.or
Appears in 1 contract
Sources: Securities Purchase Agreement (SMART Global Holdings, Inc.)
Protective Provisions. 10.1 Approval of Series A Preference Shares, Series B Preference Shares, Series D Preference Shares. For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events), in In addition to any such other vote or consent required elsewhere limitations as may be provided in the Memorandum and Articles or by applicable Lawand the Companies Law (2009 Revision) of the Cayman Islands, the Company shall not, and Members shall cause the other Group Companies to not, and the holders of Ordinary Shares shall exercise all of their rights with respect to such Ordinary Shares so as to cause the Company shall procure that the Company and each of its Subsidiaries shall not (directly Group Companies to not, effect or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take otherwise consummate any of the following actions (other than those in connection with a Non-Liquidation M&A) acts without first obtaining,
7.1 the prior vote or written consent approval of (i) the holder(s) of at least 75% of the holders outstanding Series A Shares and Series A1 Shares (in aggregate and on an as-converted basis), and (ii) the holder(s) of at least 50% of the then outstanding Series D Preference Shares, the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference Shares, each voting separately B1 Shares (in aggregate and on an as converted basis); provided that such requirement shall terminate upon a single class.Qualified Public Offering:
(a) to liquidate, dissolve any amendment or wind up the affairs change of the Companyrights, preferences, privileges or powers of, or effect any Liquidating Transaction;
(b) to amend, alter, or repeal any provision of the Memorandum and Articles;
(c) to create or authorize restrictions provided for the creation of or issue any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Sharesbenefit of, the Series B Preference Preferred Shares or the Series D Preference Shares, or increase the authorized number of shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(b) any action to authorize, create or issue shares of any class or series of the Company having preferences superior to or on a parity with the Preferred Shares in any aspects including without limitation, dividend rights, redemption rights and/or liquidation rights;
(c) any new issuance of any equity securities of the Company, including any change in the total number of authorized Series B Shares and Series B1 Shares, but excluding (i) any issuance of the Series B1 Shares authorized under the Purchase Agreement, (ii) any issuance of Ordinary Shares upon conversion of the Preferred Shares, (iii) the issuance of 66,580,000 Ordinary Shares upon the exercise of the option held by Winsome Group Limited on behalf of Ma ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ Ho, Ma Wen Lie, ▇▇▇▇ Lo Yin, Li Jin and other officers, employees and advisors of the Company, (iv) the issuance of up to take actions subject 151,430,000 Ordinary Shares (or options or warrants therefor) pursuant to other protective provisions employee equity incentive plans, and (v) the issuance of up to be set forth in 50,246,000 Ordinary Shares upon the definitive agreements in connection exercise of the options granted to certain individuals under the Company’s 2009 Share Incentive Plan;
(d) any action of the Company to reclassify any outstanding shares into shares having preferences or priority as to dividends or assets senior to or on a parity with the Series A financingpreference of the Preferred Shares;
(e) any increase or decrease of the authorized number of Ordinary Shares or Preferred Shares of the Company;
(f) any amendment of the Memorandum and Articles of Association or other charter documents of the Company (including any Major Subsidiary);
(g) any merger or consolidation of the Company (including any Subsidiary) with or into any other business entity in which the shareholders of the Company (including any Subsidiary) immediately after such merger or consolidation held shares representing less than a majority of the voting power of the outstanding share capital of the surviving business entity;
(h) any transaction or series of transactions that would result in a change of control of the Company (including any Subsidiary);
(i) the sale, lease, transfer or other disposition of all or substantially all of the Series B financing or assets of the Series D financingCompany (including any Subsidiary), except for intra-group transactions among the Company and any Subsidiaries;
(j) to approve and change any compensation package licensing or other transfer of the management patents, copyrights, trademarks or other intellectual property of the CompanyCompany (including any Subsidiary) other than in the ordinary course of its business, including but not limited to except for intra-group transactions among the chief executive officer, general manager, Company and any other key employee; andSubsidiaries;
(k) any increase or decrease of the authorized number of the members of the Board (including any committees of the Board) of the Company;
(l) effect a liquidation, dissolution or winding up of the Company (including any Subsidiary);
(m) the declaration or payment of a dividend or other distribution on Ordinary Shares or Preferred Shares of the Company;
(n) any increase of the number of Ordinary Shares of the Company reserved under any employee equity incentive plan;
(o) any increase in compensation of any employee of the Company (including any Subsidiary) with an annual salary of US$50,000 or more by more than 20% in a twelve (12) month period;
(p) the extension by the Company of any loan or guarantee for indebtedness to agree any director, officer, employee or undertake affiliate of the Company (including any Subsidiary), except for intra-group transactions among the Company and any Subsidiaries;
(q) any incurrence of indebtedness in excess of US$1,000,000 in the aggregate to do the Company (including any Subsidiary), or creation of any encumbrance whatsoever upon the assets, patents, copyrights, trademarks or other intellectual property of the Company (including any Subsidiary);
(r) any purchase by the Company (including any Subsidiary) of real property with a value of US$1,000,000 or more, or any purchase of production facilities with a value of US$500,000 or more, individually or in the aggregate;
(s) any transaction or series of transactions that are not in the ordinary course of the Company’s business where the value involved exceeds US$1,000,000, individually or in the aggregate, during any twelve (12) month period,;
(t) approval of the annual consolidated budget of the Company;
(u) the appointment and removal of any key officer of the Company (including any Major Subsidiary), including the Chief Executive Officer and the Chief Financial Officer;
(v) the appointment and/or reappointment of auditors of the Company; or
(w) any transaction involving both the Company (including any Subsidiary) and a shareholder of any Group Company or any of the foregoingCompany’s employees, officers, directors or shareholders or any affiliate of a shareholder of any Group Company or any of such affiliate’s officers, directors or shareholders, except for intra-group transactions among the Company and any Subsidiaries and employment contracts between a Group Company and its employees that are not otherwise subject to this Section 7, and
7.2 the prior written approval of the holder(s) as at the date hereof (taking no account of any share issuances after the date hereof) of at least 96% of the aggregate of Ordinary Shares and Preferred Shares (on an as-converted basis), provided that such requirement shall terminate upon a Qualified IPO, any repurchase or redemption of any equity securities of the Company other than (A) pursuant to contractual rights to repurchase Ordinary Shares from the employees, directors or consultants of the Company upon termination of their employment or services or (B) pursuant to a contractual right of first refusal held by the Company. Provided, however that, to the extent that the applicable laws prevent the Company from being bound by any of the above provisions, such provisions shall be binding as amongst the parties hereto (other than the Company) and such parties shall take all actions necessary to give effect to such provisions.
Appears in 1 contract
Protective Provisions. 10.1 Approval of Series A Preference Shares8.1. In addition to such other limitations as may be provided in the Restated Articles, Series B Preference Shares, Series D Preference Shares. For for so long as Bertelsmannany Preferred Shares are outstanding, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events), in addition to any other vote or consent required elsewhere in the Memorandum and Articles or by applicable Law, the each Group Company shall not, and Members of the Company Founders and the BVI Companies shall procure that the each Group Company and each of its Subsidiaries shall not (directly or by amendmentnot, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take any of the following actions (other than those in connection with a Non-Liquidation M&A) without the prior affirmative vote or prior written consent of (i) the holders of at least shares carrying more than fifty percent (50% %) of the voting power of the then outstanding Series D Preference Preferred Shares, (ii) the holders of at least shares carrying more than fifty percent (50% %) of the voting power of the then outstanding Series B Preference C+ Preferred Shares and Series C-4 Preferred Shares, (iii) the holders of at least shares carrying more than fifty percent (50% %) of the voting power of the then outstanding Series C Preferred Shares, (iv) the holders of more than fifty percent (50%) of the then outstanding Series B-2 Preferred Shares, and (v) holders of shares carrying more than fifty percent (50%) of the voting power of the then outstanding Series A Preference Shares, each Preferred Shares and Series B-1 Preferred Shares (voting separately as a single class.separate classes):
(a) to liquidate, dissolve any amendment or wind up the affairs change of the Companyrights, preferences, privileges or powers of, or effect the restrictions provided for the benefit of any Liquidating Transactionof, the Preferred Shares;
(b) to amendany action that authorizes, alter, creates or repeal issues any provision class of shares of the Memorandum and Articlescapital of the Company having preferences superior to or on a parity with any of the Preferred Shares or any new issuance of any securities of the Company;
(c) any action that reclassifies any outstanding shares into shares having preferences or priority as to create dividends or authorize assets superior to or on a parity with the creation preference of any of the Preferred Shares;
(d) any repurchase or redemption of the equity securities of any Group Company other than pursuant to (i) the contractual rights to repurchase the Ordinary Shares or Preferred Shares from the employees, directors or consultants of any Group Company upon termination of their employment or services pursuant to the stock incentive plan or other equity incentive programs, or (ii) the redemption rights provided under the Company’s Memorandum and Articles of Association or other charter documents of any Group Company;
(e) any increase, decrease or cancellation of the authorized or issued share capital of any Group Company or any issuance, allotment, or sale of any shares or securities convertible into or carrying a right of subscription in respect of shares or any share warrants or grant or issue any other security convertible into options rights or exercisable for any equity security, having rights, preferences warrants or privileges senior to or on parity with which may require the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, or increase the authorized number issue of shares of in the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares future or do any act which has the effect of diluting or reducing the effective shareholding of the Investors in the Company;
(f) any amendment, modification or change of the Company’s Memorandum and Articles of Association or other charter documents of any Group Company;
(g) any dividend or distribution of the profits of the Company by way of dividend (interim or final), capitalization of reserves or otherwise, or any declaration therefor;
(h) any increase or decrease of the authorized size of the board of directors of any Group Company, or amend the rules of appointing the directors as provided herein, or amend the power of any Director;
(i) any sale of all or substantially of any of the Group Company’s assets, goodwill, or any material asset or undertaking of any Group Company;
(j) commencement of any liquidation, dissolution, winding up or termination of any Group Company;
(k) any merger, consolidation or amalgamation of any Group Company with any other entity or entities or any spin-off, sub-division, or any transaction in which the control of any Group Company is transferred, or any other transaction of a similar nature or having a similar economic effect as any of the foregoing, or other forms of restructuring of any Group Company;
(l) the initial public offering of any of the Shares or other equity or debt securities of any Group Company (or as the case may be, the shares or securities of the relevant entity resulting from any merger, reorganization or other arrangements made by or to the Company for the purposes of public offering);
(m) any other event which may negatively affect the rights, preferences, privileges or powers of the Investors herein; provided that, where a special resolution or an ordinary resolution, as the case may be, is required by applicable statute to approve any of the matters listed above, and such matter has not received consent of the holders of shares carrying more than fifty percent (50%) of the voting power of the then outstanding Series A Preference D Preferred Shares, the holders of shares carrying more than fifty percent (50%) of the voting power of the then outstanding Series B Preference C+ Preferred Shares or the and Series D Preference C-4 Preferred Shares, provided thatthe holders of shares carrying more than fifty percent (50%) of the voting power of the then outstanding Series C Preferred Shares, no vote or written consent under this Section shall be required from and the Holders holders of more than fifty percent (50%) of the then outstanding Series D B-2 Preferred Shares, and holders of shares carrying more than fifty percent (50%) of the voting power of the then outstanding Series B-1 Preferred Shares before and Series A Preferred Shares (voting as separate classes), then the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with holders who voted against the special resolution or the ordinary resolution, as the case may be, shall together carry the number of votes equal to the votes of all members who voted for the resolution plus one.
8.2. In addition to such other limitations as may be provided in the Memorandum Restated Articles, for so long as any Preferred Shares are outstanding, each Group Company shall not, and Articles after July 1the Founders and the BVI Companies shall procure that each Group Company shall not, 2015take any of the following actions without the prior written approval of the Board (including the approval of all Investor Directors):
(a) ceasing to conduct or carrying on the business of any Group Company substantially as now conducted, any Group Company entering into any new business lines or changing any part of its business activities;
(b) deciding on the terms and conditions of the appointment of, and the compensation and salaries payable to, the Chief Executive Officer, Chief Financial Officer, Chief Operating Officer and President of any Group Company, and any variations to any of such terms, conditions, compensation or salaries (provided that determination of such terms, conditions, compensation or salaries shall also be subject to the board approval);
(c) any approval of or amendment to or implementation of any stock incentive plan (including the ESOP, as defined in Section 9.6) or increase the number of shares reserved for any equity incentive plan (including the ESOP);
(d) to create, or issue any increase in aggregate compensation (including all benefits and bonus) of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to five most highly compensated employees or consultant as ESOP pursuant to this Agreement)officers of any Group Company by more than fifty percent (50%) in a twelve (12) months period;
(e) any disposing of or licensing to purchase any third party any patent, brand, copyright, trademark or redeem or pay any dividend intellectual property of the Group Company, unless such transaction occurs in the ordinary course of business of the Group Company and on any capital stock normal commercial terms and has been fully disclosed in writing to the Preferred Shareholders prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation entering into of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015such transaction;
(f) borrowing any money or obtaining any financial facilities except pursuant to create trade facilities obtained from banks or authorize other financial institutions in the creation ordinary course of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Directorbusiness;
(g) making any loan or advance or giving any credit to increase or decrease any Person outside the size ordinary course of the Boardbusiness;
(h) to approve any change investment in securities (excluding fixed-income securities) in a single transaction or a series of transactions where such investment would in the business scope aggregate exceed US$1,000,000, or activities of the Companyany investment in futures or derivatives;
(i) to take actions subject any incurrence of pledge, lien or charge (whether by way of fixed or floating change, mortgage encumbrance or other security) on all or any of the undertaking, assets or rights of any Group Company except those provided to other protective provisions to be set forth Group Companies or for the purpose of securing borrowings from banks or other financial institutions in the definitive agreements ordinary course of business in connection with the Series A financing, the Series B financing or the Series D financingan aggregate amount not to exceed US$1,000,000;
(j) any incurrence of material transaction outside the ordinary course of business of any Group Company in excess of US$1,000,000 or of any capital expenditure greater than US$1,000,000;
(k) any action to approve or make adjustments or modifications to terms of transactions between any directors, officers, or shareholders of any Group Company and change any compensation package of the management of the Group Company, including but not limited to the chief executive officermaking of any loans or advances, general managerwhether directly or indirectly, or the provision of any guarantee, indemnity or security for or in connection with any indebtedness of liabilities of any director or shareholder of any Group Company;
(l) the adoption of and significant modifications to the annual budget or business plan of any Group Company;
(m) any appointment, replacement or removal of the auditor or any alteration of the fiscal or auditing policy of any Group Company, or change the financial year of the Company;
(n) acquiring or disposing of any investment into any entity (regardless if such investment may be capitalized on the Company’s balance sheet or not), in a single transaction or a series of transactions where such investment would in the aggregate exceed US$1,000,000, or incur any commitment in excess of US$1,000,000 at any time in respect of any one transaction or in excess of US$2,000,000 at any time in related transactions in any financial year of the Company and/or any subsidiary;
(o) any acquisition or formation of any subsidiary or acquisition of the whole or any substantial part of the undertakings, assets or business of any other key employee; andcompany or any entity or any entry into any joint venture or partnership with any other entity or any entry into any merger, consolidation or restructure, in excess of a consideration of more than US$2,000,000;
(kp) any action to agree enter into any related party transaction or undertake to do hiring any relative of any Founder by any Group Company; or
(q) any amendment, extension or termination of the foregoingControl Documents (as defined in the Series D-2 Share Purchase Agreement).
Appears in 1 contract
Sources: Shareholder Agreements (TuanChe LTD)
Protective Provisions. 10.1 Approval of Series A Preference SharesThe Partnership and the General Partner hereby covenant and agree that, Series B Preference Shares, for as long as any Series D Preference Shares. For so long as BertelsmannPreferred Units are outstanding, Sumitomo and BlueFocus respectively holds no less than 448,801 Sharesneither the Partnership nor the General Partner shall, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events)Partnership and the General Partner shall cause their respective Subsidiaries not to, in addition to any other vote undertake or consent required elsewhere in the Memorandum and Articles or by applicable Law, the Company shall not, and Members of the Company shall procure that the Company and each of its Subsidiaries shall not (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take permit any of the following actions (other than those in connection with a Non-Liquidation M&A) actions, directly or indirectly, without the prior vote or written consent of the holders of at least 50% of the then outstanding Series D Preference Shares, the holders record of at least 50% a majority of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference Shares, each voting separately as a single class.
(a) to liquidate, dissolve or wind up the affairs of the Company, or effect any Liquidating Transaction;
(b) to amend, alter, or repeal any provision of the Memorandum and Articles;
(c) to create or authorize the creation of or issue any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Shares, the Series B Preference Shares or the Series D Preference SharesPreferred Units then outstanding:
(1) in the case of the Partnership, authorize or issue, or increase the authorized number of shares of the Series A Preference Sharesor issued amount of, the Series B Preference Shares (A) equity securities ranking, as to distributions and upon liquidation, on a parity with or senior to the Series D Preference Shares Preferred Units or do (B) Common Units or other equity securities ranking, as to distributions and upon liquidation, junior to the Series D Preferred Units, to the extent that such Common Units or other junior equity securities contain any act which has rights that restrict in any way management of the effect of diluting Partnership, the General Partner or reducing their respective Subsidiaries or would reasonably be expected to interfere with the effective shareholding Series D Preferred Units or the rights of the holders thereof; and (2) in the case of the Series A Preference SharesGeneral Partner, any Subsidiary of the General Partner or any Subsidiary of the Partnership, authorize or issue additional (A) shares of preferred stock or preferred equity securities or (B) shares of common stock or common equity securities or other equity securities ranking, as to distributions and upon liquidation, junior to shares of such entity’s preferred stock or preferred equity securities, to the extent that such shares of common stock, common equity securities or other junior equity securities contain any rights that restrict in any way management of the General Partner, the Series B Preference Shares Partnership or their respective Subsidiaries or would reasonably be expected to interfere with the Series D Preference Shares, provided that, no vote Preferred Units or written consent under this Section shall be required from the Holders rights of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015holders thereof;
(dii) to createamend, alter, repeal or issue waive any of the provisions of (1) this Amendment or the Purchase Agreement or (2) the certificate of limited partnership of the Partnership, the Partnership Agreement, the Articles of Incorporation or bylaws of the General Partner or the organizational documents of any debenture of their respective Subsidiaries, in the case of clause (2) only, to the extent that such amendment would reasonably be expected to adversely affect the Series D Preferred Units or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares the rights of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement)holders thereof;
(eiii) to redeem, purchase or redeem or pay otherwise acquire for any dividend on any capital stock prior consideration (1) in the case of the Partnership, equity securities of the Partnership that rank, as to distributions and upon liquidation, junior to the Series A Preference SharesD Preferred Units, including Common Units, and (2) in the case of the General Partner, any Subsidiary of the General Partner or any Subsidiary of the Partnership, any class or series of capital stock or equity securities; provided, that the foregoing shall not prohibit the following: (A) redemptions pursuant to the Share Redemption Program; and (B) redemptions of Common Units in exchange for which the General Partner issues REIT Shares to the holders of such Common Units as the sole consideration therefor pursuant to the terms of the Partnership Agreement;
(iv) engage in a Change of Control;
(v) commence or suffer to exist an Event of Bankruptcy as to the Partnership, the Series B Preference Shares General Partner or any of their respective Subsidiaries;
(vi) pay any special distributions (which, for purposes hereof, shall mean any distribution other than a distribution made on a regular monthly basis consistent with past practice) on (1) in the case of the Partnership, Common Units or other equity securities that rank, as to distributions and upon liquidation, junior to the Series D Preference Shares Preferred Units and (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any2) in accordance with the Memorandum case of the General Partner, any Subsidiary of the General Partner or any Subsidiary of the Partnership, shares of common stock or common equity securities or other equity securities that rank, as to distributions and Articles after July 1upon liquidation, 2015;junior to such entity’s shares of preferred stock or preferred equity securities; provided, that the foregoing shall not prohibit special distributions that are necessary to preserve the General Partner’s status as a REIT under the Code; or
(fvii) to create engage in a recapitalization, reorganization, merger, unit or authorize stock split, statutory unit or stock exchange, sale of all or substantially all of such entity’s assets, tender offer for all or substantially all of its Common Units, shares of common stock or other common equity securities, as the creation of any debt security (case may be, or other than equipment leases or bank lines of credit) unless such debt security has received similar transaction. Neither the prior approval of Partnership nor the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(i) to take actions subject to other protective provisions to be set forth in the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financing;
(j) to approve and change any compensation package of the management of the Company, including but not limited to the chief executive officer, general managerGeneral Partner shall take, and shall cause their respective Subsidiaries not to take, any other key employee; and
(k) to agree or undertake to do action in furtherance of any of the foregoingforegoing actions without obtaining the required consent therefor, as specified in this Section 7(a). Notwithstanding any provision in this Section 7(a) to the contrary, the Partnership shall be able to enter into tax protection agreements in the ordinary course of its business.
Appears in 1 contract
Sources: Limited Partnership Agreement (Strategic Storage Trust VI, Inc.)
Protective Provisions. 10.1 Approval Subject to the rights of series of Preferred Stock which may from time to time come into existence, so long as any shares of Series A Preference SharesPreferred Stock are outstanding, Series B Preference Shares, Series D Preference Shares. For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events), in addition to any other vote or consent required elsewhere in the Memorandum and Articles or by applicable Law, the Company shall not, and Members of the Company shall procure that the Company and each of its Subsidiaries this corporation shall not without first obtaining the approval (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take any of the following actions (other than those in connection with a Non-Liquidation M&A) without the prior vote or written consent consent, as provided by law) of the holders of at least 50% two thirds (66.67%) of the then outstanding Series D Preference Shares, the holders shares of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference Shares, each voting separately as a single class.Preferred Stock:
(a) to liquidatesell, dissolve convey, or wind up otherwise dispose of or encumber all or substantially all of its property or business or merge with and into any other corporation where the affairs of corporation is not the Companysurviving corporation (other than a wholly-owned subsidiary corporation), or effect any Liquidating Transaction;transaction or series of related transactions in which more than fifty percent (50%) of the voting power of the corporation is disposed of, or effect any voluntary liquidation, dissolution or winding up of the corporation or recapitalization of the corporation; or
(b) to amendalter or change the rights, alter, preferences or repeal any provision privileges of the Memorandum and Articles;shares of Series A Preferred Stock so as to adversely affect such shares; or
(c) increase or decrease (other than by redemption or conversion) the total number of authorized shares of capital stock or any series of capital stock, provided, however, that no such approval shall be required to create increase the total number of authorized shares of Common Stock to less than or equal to fifteen million (15,000,000) shares; or
(d) authorize the creation of or issue issue, or obligate itself to issue, any equity security, including any other security convertible into or exercisable for any equity security, (i) having a preference over, or being on a parity with, the rights, preferences or and privileges senior to or on parity with of the Series A Preference SharesPreferred Stock with respect to dividends, liquidation or voting (provided that additional shares of Common Stock having the same number of votes per share as the Series B Preference Shares A Preferred Stock may be issued), or (ii) having rights similar to any of the rights of the Series A Preferred Stock under this Section 8; or
(e) redeem, purchase or otherwise acquire (or pay into or set aside for a sinking fund for such purpose) any share or shares of Common Stock; provided, however, that this restriction shall not apply to the repurchase of shares of Common Stock from certain shareholders pursuant to that certain Shareholder Agreement dated June 8, 1994 or that certain Shareholders' Agreement dated on or about February 12, 1998 or the Series D Preference Sharesrepurchase of shares of Common Stock from employees, officers, directors, consultants or other persons performing services for the corporation or any subsidiary pursuant to agreements under which the corporation has the option to repurchase such shares at cost upon the occurrence of certain events, such as the termination of employment; or
(f) issue, or obligate itself to issue, greater than 533,333 shares of Series A Preferred Stock; or
(g) pay any dividends on the corporation's Common Stock; or
(h) amend the corporation's Articles of Incorporation, provided, however, that no such approval shall be required for an amendment to the corporation's Articles of Incorporation to increase the total number of authorized shares of Common Stock to less than or equal to fifteen million (15,000,000) shares; or (i)ab increase the authorized number of shares directors of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount corporation to more than thirteen (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement13);
(e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(i) to take actions subject to other protective provisions to be set forth in the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financing;
(j) to approve and change any compensation package of the management of the Company, including but not limited to the chief executive officer, general manager, and any other key employee; and
(k) to agree or undertake to do any of the foregoing.
Appears in 1 contract
Sources: Series a Preferred Stock Purchase Agreement (Pemstar Inc)
Protective Provisions. 10.1 Approval (a) The holders of Series A the Preference SharesShares shall have the following consent rights (“Protective Provisions”), Series B Preference Shareswhich shall be subject to a vote at a Special General Meeting of the shareholders of the Company:
(b) Subject to Bye-law 3(b)(v)(c), Series D Preference Shares. For for so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 at least 4,056,978 Preference Shares (subject to adjustments made as adjusted for share splitconsolidations, subdivisionsubdivisions, consolidationshare dividends, reorganization redesignations, reclassifications, recapitalizations and the like events), like) remain in addition to any other vote or consent required elsewhere in the Memorandum and Articles or by applicable Lawissue, the Company shall not, and Members without first obtaining the Requisite Approval, engage in any of the following:
(i) any action that authorizes, creates or issues any shares having preferences superior to or on a parity with the any series of Preference Shares;
(ii) any amalgamation, consolidation, acquisition or similar transaction of the Company shall procure that with one or more other companies in which the shareholders of the Company and each prior to such transaction, or series of its Subsidiaries shall not (directly or by amendmentrelated transactions, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take any would hold shares representing less than a majority of the following actions voting power of the issued shares of the surviving company immediately after such transaction or series of transactions;
(iii) any acquisition or divestiture of assets (including, without limitation, intellectual property assets) other than licensing of intellectual property in the ordinary course of business and sale leasebacks (other than those in connection with a Non-Liquidation M&Asale leasebacks of intellectual property) without the prior vote and sales of equity or written consent of the holders of at least 50% of the then outstanding Series D Preference Shares, the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference Shares, each voting separately as a single class.
similar financing transactions (a) to liquidate, dissolve having a value of greater than fifty million United States Dollars (USD 50,000,000) or wind up (b) with any affiliate or shareholder of the affairs Company if such acquisition or divestiture has a value of greater than twenty-five million United States Dollars (USD 25,000,000);
(iv) the sale of all or substantially all of the Company, or effect any Liquidating Transaction’s assets (“ Sale Event”);
(bv) to amendthe liquidation, alter, dissolution or repeal any provision winding up of the Memorandum and ArticlesCompany;
(cvi) to create the declaration or authorize payment of a dividend on the creation Ordinary Class Shares (other than a dividend payable solely in Ordinary Class Shares) or redemption or repurchase of Ordinary Class Shares or issue any other security convertible into or exercisable for any equity securitypreference shares senior to, having rights, preferences or privileges senior junior to or on parity with the Series A Preference Shares, the or Series B Preference Shares or the Series D Preference Shares, or increase the authorized number of shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) except in accordance with obligations existing at the time of the issuance of such shares pursuant to compensation, equity incentive and other employment arrangements, or lending or equipment lease financing or similar transactions referred to in the Memorandum and Articles after July 1, 2015Bye-law 3(b)(iii)(l)(iv)(D) hereof;
(vii) except in the circumstances set out in Bye-laws 3(b)(i)(c) or (d) to create, or issue of any debenture or any obligation convertible into), any securities convertible into, any option to purchase increase or subscribe for, or warrants exercisable for, Shares decrease in the authorised number of Directors of the Company (provided, that the approval required for such action shall be the Requisite Approval without taking into account Preference Shares other than grant stock options to employees or consultant as ESOP pursuant to this AgreementVoting Preference Shares);
(eviii) the incurrence of any Indebtedness (as defined in the Amended and Restated Credit Agreement, dated as of December 21, 2000, among Stratus Computer (DE), Inc., a Delaware corporation, Stratus Technologies International S.à.▇.▇. (formerly known as Stratus Computer Systems S.à.▇.▇.), a company organized under the laws of Luxembourg, the several lenders from time to purchase or redeem or pay any dividend time parties thereto, the JPMorgan Chase Bank (formerly known as Chase Manhattan Bank), a New York banking corporation, as administrative agent for the lenders, and the other parties thereto, as amended (“Credit Agreement”)) by the Company and its subsidiaries in an aggregate amount greater than fifty million United States Dollars (USD 50,000,000) in excess of the amount outstanding and available to be drawn under the Credit Agreement, unless, after giving effect to the incurrence of such Indebtedness, the ratio of Indebtedness to EBITDA (based on any capital stock the twelve months ending prior to the Series A Preference Shares, the Series B Preference Shares month in which such calculation was made) is less than or the Series D Preference Shares equal to three (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any3) in accordance with the Memorandum and Articles after July 1, 2015times EBITDA;
(fix) to create or authorize the creation of an increase, in any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(i) to take actions subject to other protective provisions to be set forth in the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financing;
(j) to approve and change any compensation package of the management financial year of the Company, including but not limited in the number of options made available pursuant to the chief executive officer, general manager, and any other key employee; and
Option Pool in excess of two percent (k2%) to agree or undertake to do any of the foregoingmaximum number of options (without regard to outstanding or exercised options) issuable pursuant to the Option Pool, as the same may have been increased in accordance with this Bye-law 3(b)(v)(b)(ix).
Appears in 1 contract
Sources: Second Lien Credit Agreement (Stratus Technologies Bermuda Holdings Ltd.)
Protective Provisions. 10.1 Approval of Series A Preference SharesThe Partnership and the General Partner hereby covenant and agree that, Series B Preference Shares, Series D Preference Shares. For so for as long as Bertelsmannany Preferred Units are outstanding, Sumitomo and BlueFocus respectively holds no less than 448,801 Sharesneither the Partnership nor the General Partner shall, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events)Partnership and the General Partner shall cause their respective Subsidiaries not to, in addition to any other vote undertake or consent required elsewhere in the Memorandum and Articles or by applicable Law, the Company shall not, and Members of the Company shall procure that the Company and each of its Subsidiaries shall not (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take permit any of the following actions (other than those in connection with a Non-Liquidation M&A) actions, directly or indirectly, without the prior vote or written consent of the holders of at least 50% of the then outstanding Series D Preference Shares, the holders record of at least 50% a majority of the Preferred Units then outstanding Series B Preference Shares and outstanding:
(1) in the holders of at least 50% case of the then outstanding Series A Preference SharesPartnership, each voting separately as a single class.
(a) to liquidate, dissolve authorize or wind up the affairs of the Company, or effect any Liquidating Transaction;
(b) to amend, alter, or repeal any provision of the Memorandum and Articles;
(c) to create or authorize the creation of or issue any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Sharesissue, or increase the authorized number or issued amount of, (A) equity securities ranking, as to distributions and upon liquidation, on a parity with or senior to the Preferred Units or (B) Common Units or other equity securities ranking, as to distributions and upon liquidation, junior to the Preferred Units, to the extent that such Common Units or other junior equity securities contain any rights that restrict in any way management of the Partnership, the General Partner or their respective Subsidiaries or would reasonably be expected to interfere with the Preferred Units or the rights of the holders thereof; and (2) in the case of the General Partner, any Subsidiary of the General Partner or any Subsidiary of the Partnership, authorize or issue additional (A) shares of preferred stock or preferred equity securities or (B) shares of common stock or common equity securities or other equity securities ranking, as to distributions and upon liquidation, junior to shares of such entity’s preferred stock or preferred equity securities, to the extent that such shares of common stock, common equity securities or other junior equity securities contain any rights that restrict in any way management of the General Partner, the Partnership or their respective Subsidiaries or would reasonably be expected to interfere with the Preferred Units or the rights of the holders thereof;
(ii) amend, alter, repeal or waive any of the provisions of (1) this Designation of Rights, the Purchase Agreement or any of the other Transaction Documents or the transactions contemplated hereby or thereby or (2) the certificate of limited partnership of the Partnership, the Partnership Agreement, the Articles of Incorporation or bylaws of the General Partner or the organizational documents of any of their respective Subsidiaries, in the case of clause (2) only, to the extent that such amendment would reasonably be expected to adversely affect the Preferred Units or, in the event that any Preferred Units have been exchanged for Series A Preferred Shares pursuant to Section 10, the Series A Preference SharesPreferred Shares or the respective rights of the holders thereof;
(iii) incur, renew, refinance, modify or otherwise discharge any Indebtedness of the Partnership, the General Partner or any of their respective Subsidiaries, or extend credit, make a loan or become a guarantor or surety for debt of another party, to the extent that any such action would cause a breach, violation of or failure to meet one or more of the Financial Covenants;
(iv) redeem, purchase or otherwise acquire for any consideration (1) in the case of the Partnership, equity securities of the Partnership that rank, as to distributions and upon liquidation, junior to the Preferred Units, including Common Units, and (2) in the case of the General Partner, any Subsidiary of the General Partner or any Subsidiary of the Partnership, any class or series of capital stock or equity securities; provided, that the foregoing shall not prohibit the following: (A) redemptions pursuant to the Share Redemption Program so long as a Cash Flow Sweep Event is not in effect; (B) redemptions of Common Units in exchange for which the General Partner issues REIT Shares to the holders of such Common Units as the sole consideration therefor pursuant to the terms of the Partnership Agreement; and (C) redemptions of Common Units for cash pursuant to the terms of the Contribution Agreements in an aggregate amount not to exceed $5.0 million;
(v) hold assets or engage in any business outside the Partnership, the General Partner or their respective Subsidiaries;
(vi) engage in any transaction with an Affiliate of the Partnership, the General Partner or their respective Subsidiaries or amend an agreement with any such Affiliate to the extent that such transaction or amendment would reasonably be expected to adversely affect the Preferred Units or, in the event that any Preferred Units have been exchanged for Series A Preferred Shares pursuant to Section 10, the Series B Preference A Preferred Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding rights of the respective holders thereof; provided, that the foregoing shall not prohibit the following: (1) transactions described in the Advisory Agreement or in one or more of the Series A Preference Shares, Property Management Agreements with the Series B Preference Shares or Property Manager; (2) the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares annual approval of the Company Advisory Agreement by the independent members of the Board of Directors of the General Partner, as required by the Advisory Agreement; and (other than grant stock options 3) transactions contemplated as of the Date of Issuance to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to be entered into by the Series A Preference Shares, Partnership and the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants General Partner in connection with the cessation DST Program or other Affiliated contributions or exchanges;
(vii) engage in a Change of Control;
(viii) commence or suffer to exist an Event of Bankruptcy as to the Partnership, the General Partner or any of their employment/servicesrespective Subsidiaries;
(ix) pay any special distributions (which, at for purposes hereof, shall mean any distribution other than a distribution made on a regular monthly basis consistent with past practice) on (1) in the lower case of fair market value the Partnership, Common Units or cost)other equity securities that rank, provided thatas to distributions and upon liquidation, no vote junior to the Preferred Units and (2) in the case of the General Partner, any Subsidiary of the General Partner or written any Subsidiary of the Partnership, shares of common stock or common equity securities or other equity securities that rank, as to distributions and upon liquidation, junior to such entity’s shares of preferred stock or preferred equity securities; provided, that the foregoing shall not prohibit special distributions that are (x) made pursuant to and in accordance with Section 7(a) or 7(b) or (y) necessary to preserve the General Partner’s status as a REIT under the Code; or
(x) engage in a recapitalization, reorganization, merger, unit or stock split, statutory unit or stock exchange, sale of all or substantially all of such entity’s assets, tender offer for all or substantially all of its Common Units, shares of common stock or other common equity securities, as the case may be, Extraordinary Transaction (as defined in the Partnership Agreement) or other similar transaction. Neither the Partnership nor the General Partner shall take, and shall cause their respective Subsidiaries not to take, any action in furtherance of any of the foregoing actions without obtaining the required consent under therefor, as specified in this Section 7(d). Notwithstanding any provision in this Section 7(d) to the contrary, the Partnership shall be required from able to enter into tax protection agreements in the Holders ordinary course of its business. In the event that any Preferred Units have been exchanged for Series D A Preferred Shares before pursuant to Section 10, then the Company may enforce any paramount lien onGeneral Partner, make a call on as the holder of such exchanged Preferred Units, shall provide or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if anywithhold its consent pursuant to this Section 7(d) in accordance with the Memorandum determination of (and Articles after July 1, 2015;
(fin the same proportion as) the holders of such Series A Preferred Shares pursuant to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval terms of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(i) to take actions subject to other protective provisions to be set forth in the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financing;
(j) to approve and change any compensation package of the management of the Company, including but not limited to the chief executive officer, general manager, and any other key employee; and
(k) to agree or undertake to do any of the foregoingArticles Supplementary.
Appears in 1 contract
Sources: Limited Partnership Agreement (Griffin Capital Essential Asset REIT, Inc.)
Protective Provisions. 10.1 Approval So long as any of Series A Preference Shares, Series B Preference Shares, Series D Preference Shares. For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Preferred Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events), in addition to any other vote or consent required elsewhere in the Memorandum and Articles or by applicable Laware outstanding, the Company shall not, and Members of the Company shall procure that the Company and each of its Subsidiaries Corporation shall not without first obtaining the approval (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take any of the following actions (other than those in connection with a Non-Liquidation M&A) without the prior vote or written consent consent) of the holders of at least 50% a majority of the Series B Preferred Shares then outstanding Series D Preference Sharesoutstanding, the holders voting together as a separate class:
8.1. sell, lease, exchange, transfer, convey, exclusively license or otherwise dispose of at least 50% all or substantially all of the then outstanding Series B Preference Shares and Corporation's assets or merge into or consolidate with any other corporation (other than a wholly-owned subsidiary corporation provided that the holders of at least 50% of Corporation is the then outstanding Series A Preference Shares, each voting separately as a single class.
(asurviving corporation) to liquidate, dissolve or wind up the affairs of the Company, or effect any Liquidating Transactiontransaction or series of related transactions in which 50% or more of the voting power of the Corporation is transferred or otherwise disposed of;
(b) to 8.2. amend, alter, or repeal any provision of the Memorandum and ArticlesCorporation's certificate of incorporation or Bylaws (whether by merger, consolidation or otherwise) if such amendment, alteration or repeal would alter or change the powers, preferences or special rights of the Series B Preferred Shares so as to effect them adversely;
(c) to 8.3. authorize, create or authorize the creation of or issue any class or series of stock or any other security securities convertible into or exercisable for any or issued in connection with equity security, securities of the Corporation having rights, preferences or privileges senior superior to or on parity with the Series A Preference B Preferred Shares, the Series B Preference Shares or the Series D Preference Shares, or increase the authorized number of shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to 8.4. increase or decrease the size number of authorized shares of Series B Preferred Stock;
8.5. pay any dividend or other distribution on, or make any repurchase or redemption of, any shares(s) of any class or series of stock or other securities of the BoardCorporation; provided, however, that this restriction shall not apply to the redemption described in Section 4;
8.6. incur any debt obligations or any other liabilities (h) to approve any change in the business scope or activities of the Company;
(i) to take actions subject to other protective provisions to be set forth in the definitive agreements in connection with the Series A financing, beyond those existing on the Series B Issuance Date), provided such restrictions will apply only with respect to: (A) the funding of merger, consolidation and acquisition transactions (or the portion thereof) undertaken by the Corporation or its affiliates that are paid in cash; and (B) financings by the Corporation and/or any of its subsidiaries (collectively, the "CBH Group") that are undertaken outside of the normal course of business such as capital expenditure, bank financing or refinancing, or similar funding normally undertaken by the CBH Group pursuant to prior board approvals or within pre-approved operating budgets;
8.7. asset disposals by the CBH Group over cumulative amount of $10,000,000 or resulting in total remaining carrying cost of net property, plant and equipment and other long-term tangible assets of the CBH Group decreasing below $15,000,000;
8.8. diversifications into ventures not related to the Corporation's core business on the Series D financingB Issuance Date;
8.9. the departure of Mr. Shi Mingsheng or Mm. Zhang Jian from the CBH Group (j) voluntary o▇ ▇▇▇▇▇wise); or
8.▇▇. ▇▇▇ ▇▇currence of any transaction or series of related transaction pursuant to approve and change any compensation package which stockholders of the Corporation comprising members of its senior management and directors on the Series B Issuance Date, and those shareholders affiliated with Suzhou Erye Pharmaceutical Company Ltd., sell, exchange, transfer, convey, pledge or otherwise dispose in full or in part any of their securities in the Corporation to an unrelated third party who then as a result will have the ability to exert control of the Company, including but not limited to the chief executive officer, general manager, and any other key employee; and
(k) to agree or undertake to do any Corporation by virtue of gaining control of the foregoingBoard of Directors or through other similar means.
Appears in 1 contract
Sources: Conditional Loan Conversion Agreement (China Biopharmaceuticals Holdings Inc)
Protective Provisions. 10.1 Approval So long as the Lead Investor beneficially owns at least at least twenty percent (20%) of Series A Preference the Conversion Shares underlying the Preferred Shares issued pursuant to the Securities Purchase Agreement (assuming the full conversion of such Preferred Shares, Series B Preference Shares, Series D Preference Shares. For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like eventsirrespective of any ownership limitations contained therein), in addition to any other vote or consent required elsewhere in the Memorandum and Articles or except as otherwise contemplated by applicable LawSection (2), the Company shall not, and Members of the Company shall procure that the Company and each of its Subsidiaries shall not (either directly or indirectly by amendment, merger, consolidation, amalgamationrecapitalization, scheme of arrangement reclassification, or otherwise) take , do any of the following actions without (in addition to any other than those in connection with a Non-Liquidation M&Avote required by law or the Company’s Amended and Restated Certificate of Incorporation) without the prior vote or written consent of the holders Lead Investor, and any such act or transaction entered into without such consent or vote shall be null and void ab initio, and of at least 50% of the then outstanding Series D Preference Shares, the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference Shares, each voting separately as a single class.no force or effect:
(a) to liquidateCreate, dissolve or wind up the affairs of the Company, or effect any Liquidating Transaction;
(b) to amend, alter, or repeal any provision of the Memorandum and Articles;
(c) to create or authorize the creation of of, or issue or obligate itself to issue shares of, or reclassify, any other security convertible into or exercisable for any equity security, having capital stock unless the same ranks junior to the Preferred Shares with respect to its rights, preferences or privileges senior to or on parity with the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Sharesand privileges, or increase the authorized number of shares of the Series A Preference Shares, the Series B Preference Shares any class or the Series D Preference Shares or do any act which has the effect series of diluting or reducing the effective shareholding capital stock of the holders of Company unless the Series A Preference Sharessame ranks junior to the Preferred Shares with respect to its rights, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum preferences and Articles after July 1, 2015privileges;
(db) to createCreate, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of, or issue, or authorize the issuance of any debt security or create any lien or security interest (except for purchase money liens or statutory liens of landlords, mechanics, materialmen, workmen, warehousemen and other than equipment leases similar persons arising or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change incurred in the business scope ordinary course of business) or activities of the Company;
(i) to take actions subject to incur other protective provisions to be set forth in the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financing;
(j) to approve and change any compensation package of the management of the Companyindebtedness for borrowed money, including but not limited to obligations and contingent obligations under guarantees, or permit any Subsidiary to take any such action with respect to any debt security lien, security interest or other indebtedness for borrowed money, if the chief executive officeraggregate indebtedness of the Company and its Subsidiaries for borrowed money following such action would exceed $10,000,000, general managerother than equipment leases, and any other key employee; andequipment purchase money loans, trade payables, or a working capital line of credit with customary terms, in each case, entered into in the ordinary course;
(kc) Directly or indirectly engage in any material line of business substantially different from those lines of business conducted by or publicly contemplated to agree be conducted by the Company and each of its Subsidiaries on the Effective Date; provided, that the foregoing shall not prevent the Company and its Subsidiaries from engaging in any business that is reasonably related or undertake incidental or ancillary to do its or their business; or
(d) amend, alter or repeal any provision of the foregoingAmended and Restated Certificate of Incorporation or Bylaws of the Corporation in a manner that adversely affects the special rights, powers and preferences of the Preferred Stock.
Appears in 1 contract
Protective Provisions. 10.1 Approval (a) So long as at least 6,450,000 Series A Preferred Shares (as adjusted for any share split, share dividend, share combination or consolidation, recapitalization, reclassification or other similar event) shall be outstanding, the Investors and Founders shall not, without obtaining the affirmative vote or written consent of the holders of a majority of the outstanding Series A Preferred Shares voting as a separate class (based on the number of Ordinary Shares into which each holder’s Series A Preferred Shares is then convertible, as adjusted from time to time), vote at a regular or special meeting of shareholders (or by written consent) to:
(i) waive, amend, or repeal any provision of the Company’s Articles of Association if such action would adversely alter or change the rights, preferences or privileges of, or the restrictions provided for the benefit of, the Series A Preferred Shares;
(ii) increase or decrease the authorized number of shares of Series A Preference Preferred Shares; or
(iii) create (by reclassification or otherwise) any new class or series of shares having rights, preferences or privileges senior to or on a parity with the Series A Preferred Shares.
(b) So long as at least 3,000,000 Series B Preference Shares, Series D Preference Shares. For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Preferred Shares (subject to adjustments made as adjusted for any share split, subdivisionshare dividend, share combination or consolidation, reorganization recapitalization, reclassification or other similar event) shall be outstanding, the Investors and the like events), in addition to any other vote or consent required elsewhere in the Memorandum and Articles or by applicable Law, the Company Founders (1) shall not, and Members without obtaining the affirmative vote or written consent of the holders of a majority of the outstanding Series B Preferred Shares voting as a separate class (based on the number of Ordinary Shares into which each holder’s Series B Preferred Shares is then convertible, as adjusted from time to time) vote at a regular or special meeting of shareholders (or by written consent) of the Company to and (2) in the case of (i), (iii), (iv), (v) and (vi) below, shall procure that the Company and each of its Subsidiaries the other Group Members shall not (directly or by amendmentnot, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take any of without obtaining the following actions (other than those in connection with a Non-Liquidation M&A) without the prior affirmative vote or written consent of the holders of at least 50% a majority of the then outstanding Series D Preference Shares, the holders of at least 50% of the then outstanding Series B Preference Preferred Shares and voting as a separate class (based on the holders number of Ordinary Shares into which each holder’s Series B Preferred Shares is then convertible, as adjusted from time to time), vote at least 50% a regular or special meeting of shareholders (or by written consent) of the then outstanding Series A Preference Shares, each voting separately as a single class.Group Member that it owns to:
(ai) to liquidatewaive, dissolve or wind up the affairs of the Company, or effect any Liquidating Transaction;
(b) to amend, alter, or repeal any provision of the Memorandum articles of association or any other charter documents of such Group Member if such action would adversely alter or change the rights, preferences or privileges of, or the restrictions provided for the benefit of, the Series B Preferred Shares;
(ii) increase or decrease the authorized number of shares of Series B Preferred Shares;
(iii) create (by reclassification, merger or otherwise) any new class or series of shares having rights, preferences or privileges with respect to dividends, or payments upon liquidation senior to or on a parity with the Series B Preferred Shares or having voting rights other than those granted to the Preferred Shares generally;
(iv) take any action that would expose the holders of Series B Preferred Shares to more than a minimal risk of being subject to taxation under Section 305 of the United States Internal Revenue Code;
(v) redeem or repurchase any of the Company’s shares or declare a dividend with respect to any such shares; provided, however, that this provision shall not apply to the Company’s redemption or repurchase of shares issued to or held by employees, officers, directors or consultants of the Company upon termination of their employment or services or pursuant to agreements providing for the right of such repurchase between the Company and Articlessuch persons;
(vi) change the number of directors constituting the full Board and the board of directors of each of the Offshore Group Members; or
(vii) amend Article 51(3)(e)(ii) of the Company’s Articles of Association.
(c) So long as at least 3,000,000 of the Series C Preferred Shares (as adjusted for any share split, share dividend, share combination or consolidation, recapitalization, reclassification or other similar event) shall be outstanding, the Investors and the Founders (1) shall not, without obtaining the affirmative vote or written consent of the holders of at least two thirds (2/3) of the outstanding Series C Preferred Shares voting as a separate class (based on the number of Ordinary Shares into which each holder’s Series C Preferred Shares is then convertible, as adjusted from time to time), vote at a regular or special meeting of shareholders (or by written consent) of the Company to, and (2) in the case of (i), (iii), (iv), (v) and (vi) below, shall procure that each of the other Group Members shall not, without obtaining the affirmative vote or written consent of the holders of at least two-thirds (2/3) of the outstanding Series C Preferred Shares voting as a separate class (based on the number of Ordinary Shares into which each holder’s Series C Preferred Shares is then convertible, as adjusted from time to time), vote at a regular or special meeting of shareholders (or by written consent) of the Group Member that it owns to:
(i) waive, amend, or repeal any provision of the articles of association or any other charter documents of such Group Member if such action would adversely alter or change the rights, preferences or privileges of, or the restrictions provided for the benefit of, the Series C Preferred Shares;
(ii) increase or decrease the authorized number of shares of Series C Preferred Shares;
(iii) create (by reclassification, merger or authorize the creation of otherwise), offer or issue any other security convertible new class or series of shares, or any securities or rights to acquire or convert into any such class or exercisable for any equity securityseries of shares, having rights, preferences or privileges (including but not limited to with respect to dividends or payments upon liquidation) senior to or on a parity with the Series A Preference SharesC Preferred Shares or having voting rights other than those granted to the Preferred Shares generally;
(iv) take any action that would expose the holders of Series C Preferred Shares to more than a minimal risk of being subject to taxation under Section 305 of the United States Internal Revenue Code;
(v) declare a dividend with respect to any of its shares or any other payment to the holders of its shares in their capacity as shareholders out of its distributable profits or reserves of the relevant Group Member;
(vi) change the number of directors constituting the full Board and the board of directors of each of the Offshore Group Members; or
(vii) amend Article 51(3)(e)(iii) of the Company’s Articles of Association.
(d) So long as at least 3,000,000 of the Series D Preferred Shares (as adjusted for any share split, share dividend, share combination or consolidation, recapitalization, reclassification or other similar event) shall be outstanding, the Investors and the Founders (1) shall not, without obtaining the affirmative vote or written consent of the holders of at least two thirds ( 2/3) of the outstanding Series D Preferred Shares voting as a separate class (based on the number of Ordinary Shares into which each holder’s Series D Preferred Shares is then convertible, as adjusted from time to time), vote at a regular or special meeting of shareholders (or by written consent) of the Company to and (2) in the case of (i), (iii), (iv), (v) and (vi) below, shall procure that each of the other Group Members shall not, without obtaining the affirmative vote or written consent of the holders of at least two-thirds ( 2/3) of the outstanding Series D Preferred Shares voting as a separate class (based on the number of Ordinary Shares into which each holder’s Series D Preferred Shares is then convertible, as adjusted from time to time), vote at a regular or special meeting of shareholders (or by written consent) of the Group Member that it owns to:
(i) waive, amend, or repeal any provision of the articles of association or any other charter documents of such Group Member if such action would adversely alter or change the rights, preferences or privileges of, or the restrictions provided for the benefit of, the Series B Preference Shares D Preferred Shares;
(ii) increase or the Series D Preference Shares, or increase decrease the authorized number of shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Preferred Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(diii) to createcreate (by reclassification, merger or otherwise), offer or issue any new class or series of shares, or issue of any debenture or any obligation convertible into, any securities convertible intoor rights to acquire or convert into any such class or series of shares, any option to purchase having rights, preferences or subscribe for, or warrants exercisable for, Shares of the Company privileges (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(i) to take actions subject to other protective provisions to be set forth in the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financing;
(j) to approve and change any compensation package of the management of the Company, including but not limited to with respect to dividends or payments upon liquidation) senior to or on a parity with the chief executive officer, general manager, and Series D Preferred Shares or having voting rights other than those granted to the Preferred Shares generally;
(iv) take any action that would expose the holders of Series D Preferred Shares to more than a minimal risk of being subject to taxation under Section 305 of the United States Internal Revenue Code;
(v) declare a dividend with respect to any of its shares or any other key employee; andpayment to the holders of its shares in their capacity as shareholders out of distributable profits or reserves of the relevant Group Member;
(kvi) to agree or undertake to do any change the number of directors constituting the full Board and the board of directors of each of the foregoingOffshore Group Members; or
(vii) amend Article 51(3)(e)(iv) of the Company’s Articles of Association.
Appears in 1 contract
Sources: Investor Rights Agreement (Ambow Education Holding Ltd.)
Protective Provisions. 10.1 Approval 9.1 Subject to the rights of Series A Preference Sharesseries of preferred stock which may from time to time come into existence, Series B Preference Shares, Series D Preference Shares. For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events), in addition to any other vote or consent required elsewhere in the Memorandum and Articles or by applicable Lawshares of Series B Preferred are outstanding, the Company Corporation shall not, and Members of without first obtaining the Company shall procure that the Company and each of its Subsidiaries shall not approval (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take any of the following actions (other than those in connection with a Non-Liquidation M&A) without the prior vote or written consent or at a meeting duly called, each as provided by law) of the holders of at least 50% a Majority In Interest of the then outstanding Series D Preference Shares, the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference SharesPreferred, each voting separately together as a single class.:
(a) Increase or decrease (other than by redemption or conversion) the total number of authorized shares of Series B Preferred (except to liquidatethe extent required to issue PIK Shares if required by the terms set forth herein, dissolve or wind up which for the affairs sake of clarity, and without otherwise limiting this provision, shall not require approval of the Company, or effect any Liquidating TransactionHolders);
(b) Re-issue any shares of Series B Preferred converted pursuant to amend, alter, or repeal any provision the terms of the Memorandum and Articlesthis Designation;
(c) to create Create, or authorize the creation of of, or issue or obligate itself to issue shares of, any class or series of capital stock unless the same ranks junior to (and not pari passu with) the Series B Preferred with respect to the distribution of assets on the liquidation, dissolution or winding up of the Corporation, the payment of dividends and rights of redemption, or increase the authorized number of shares of any additional class or series of capital stock unless the same ranks junior to (and not pari passu with) the Series B Preferred with respect to the distribution of assets on the liquidation, dissolution or winding up of the Corporation, the payment of dividends and rights of redemption, in each such case, other than issuances of (or in connection with issuances of) shares of Series B Preferred pursuant to the Purchase and Sale Agreement, PIK Shares and the Series C Preferred Stock;
(d) Effect an exchange, reclassification, or cancellation of all or a part of the Series B Preferred (except pursuant to the terms hereof);
(e) Effect an exchange, or create a right of exchange, of all or part of the shares of another class of shares into shares of Series B Preferred;
(f) Alter or change the rights, preferences or privileges of the shares of Series B Preferred so as to affect adversely the shares of such series;
(g) Authorize or issue, or obligate itself to issue, any other equity security, including any other security convertible into or exercisable for any equity security, security having rights, preferences or privileges senior to a preference over (or on parity with the Series A Preference Shares, with) the Series B Preference Shares Preferred with respect to liquidation; or
(h) Amend or waive any provision of the Corporation’s Articles of Incorporation or Bylaws, each as amended, relative to the Series D Preference SharesB Preferred so as to affect adversely the shares of Series B Preferred. For clarification, the creation or increase the authorized number issuance of shares of other series of preferred stock, provided the Series A Preference Sharesrights and preferences of such series of preferred stock with respect to the distribution of assets on the liquidation, dissolution or winding up of the Corporation, the payment of dividends are not senior to the Series B Preference Shares Preferred Liquidation Preference, shall not require the authorization or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding approval of the holders of the Series A Preference SharesB Preferred.
9.2 The Corporation will not through any reorganization, transfer of assets, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the Series B Preference Shares observance or performance of any of the Series D Preference Shares, provided that, no vote terms to be observed or written consent under performed hereunder by the Corporation but will at all times in good faith assist in the carrying out of all the provisions of this Section shall Designation and in the taking of all such action as may be required from necessary or appropriate in order to protect (a) the Holder Conversion Rights of the Holders of Series D Shares before B Preferred; and (b) the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares other rights of the Company (other than grant stock options to employees or consultant Holders as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to set forth herein, against impairment. Notwithstanding the Series A Preference Sharesforegoing, nothing shall prohibit the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased Corporation from former employees or consultants in connection amending its Articles of Incorporation with the cessation requisite consent of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director its stockholders and the Series D Director;
(g) to increase or decrease the size Board of the Board;
(h) to approve any change in the business scope or activities of the Company;
(i) to take actions subject to other protective provisions to be set forth in the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financing;
(j) to approve and change any compensation package of the management of the Company, including but not limited to the chief executive officer, general manager, and any other key employee; and
(k) to agree or undertake to do any of the foregoingDirectors.
Appears in 1 contract
Protective Provisions. 10.1 Approval of Series A Preference Shares, Series B Preference Shares, Series D Preference Shares. For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events), in In addition to any such other vote or consent required elsewhere limitations as may be provided in the Memorandum and Articles or by applicable Lawand the BVI Business Companies ▇▇▇ ▇▇▇▇, the Company shall not, and Members shall cause the other Group Companies to not, and the holders of Ordinary Shares shall exercise all of their rights with respect to such Ordinary Shares so as to cause the Company shall procure that the Company and each of its Subsidiaries shall not (directly Group Companies to not, effect or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take otherwise consummate any of the following actions acts without first obtaining,
(other than those in connection with a Non-Liquidation M&A1) without the prior vote or written consent approval of (i) the holder(s) of at least 75% of the holders outstanding Series A Shares and Series A1 Shares (in aggregate and on an as-converted basis), and (ii) the holder(s) of at least 50% of the then outstanding Series D Preference Shares, the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% (on an as converted basis); provided that such requirement shall terminate upon a Qualified Public Offering:
i. any amendment or change of the then outstanding Series A Preference Sharesrights, each voting separately as a single class.
(a) to liquidatepreferences, dissolve privileges or wind up the affairs of the Companypowers of, or effect any Liquidating Transaction;
(b) to amend, alter, or repeal any provision of the Memorandum and Articles;
(c) to create or authorize restrictions provided for the creation of or issue any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Sharesbenefit of, the Series B Preference Preferred Shares or the Series D Preference Shares, or increase the authorized number of shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(i) ii. any action to take actions subject authorize, create or issue shares of any class or series of the Company having preferences superior to other protective provisions to be set forth in the definitive agreements in connection or on a parity with the Series A financingPreferred Shares in any aspects including without limitation, the Series B financing or the Series D financingdividend rights, redemption rights and/or liquidation rights;
(j) to approve and change iii. any compensation package new issuance of the management any equity securities of the Company, including any change in the total number of authorized Series B Shares, but not limited excluding (i) any issuance of the Series B Shares authorized under the Purchase Agreement, (ii) any issuance of Ordinary Shares upon conversion of the Preferred Shares, and (iii) the issuance of 66,580 Ordinary Shares reserved for issuance upon the exercise of the option currently held by Winsome Group Limited on behalf of Ma ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ Ho, Ma Wen Lie, ▇▇▇▇ Lo Yin and other officers, employees and advisors of the Company, and (iv) the issuance of up to 151,430 Ordinary Shares (and/or options or warrants therefor) reserved for issuance pursuant to the chief executive employee equity incentive plans approved by the Compensation Committee (as defined in the Articles);
iv. any action of the Company to reclassify any outstanding shares into shares having preferences or priority as to dividends or assets senior to or on a parity with the preference of the Preferred Shares;
v. any increase or decrease of the authorized number of Ordinary Shares or Preferred Shares of the Company;
vi. any amendment of the Memorandum and Articles of Association or other charter documents of the Company (including any Major Subsidiary);
vii. any merger or consolidation of the Company (including any Subsidiary) with or into any other business entity in which the shareholders of the Company (including any Subsidiary) immediately after such merger or consolidation held shares representing less than a majority of the voting power of the outstanding share capital of the surviving business entity;
viii. any transaction or series of transactions that would result in a change of control of the Company (including any Subsidiary);
ix. the sale, lease, transfer or other disposition of all or substantially all of the assets of the Company (including any Subsidiary), except for intra-group transactions among the Company and any Subsidiaries;
x. any licensing or other transfer of the patents, copyrights, trademarks or other intellectual property of the Company (including any Subsidiary) other than in the ordinary course of its business, except for intra-group transactions among the Company and any Subsidiaries;
xi. any increase or decrease of the authorized number of the Board (including any committees of the Board) of the Company;
xii. effect a liquidation, dissolution or winding up of the Company (including any Subsidiary)
xiii. the declaration or payment of a dividend or other distribution on Ordinary Shares or Preferred Shares of the Company;
xiv. any increase of the number of Ordinary Shares of the Company reserved under any employee equity incentive plan;
xv. any increase in compensation of any employee of the Company (including any Subsidiary) with an annual salary of US$50,000 or more by more than 20% in a twelve (12) month period;
xvi. the extension by the Company of any loan or guarantee for indebtedness to any director, officer, general manageremployee or affiliate of the Company (Including any Subsidiary), except for intra-group transactions among the Company and any Subsidiaries;
xvii. any incurrence of indebtedness in excess of US$1,000,000 in the aggregate to the Company (Including any Subsidiary), or creation of any encumbrance whatsoever upon the assets, patents, copyrights, trademarks or other intellectual property of the Company (including any Subsidiary);
xviii. any purchase by the Company (including any Subsidiary) of real property with a value of US$1,000,000 or more, or any purchase of production facilities with a value of US$500,000 or more, individually or in the aggregate;
xix. any transaction or series of transactions that are not in the ordinary course of the Company’s business where the value involved exceeds US$1,000,000, individually or in the aggregate, during any twelve (12) month period;
xx. approval of the annual consolidated budget of the Company;
xxi. the appointment and removal of any key employeeofficer of the Company (including any Major Subsidiary), including the Chief Executive Officer and the Chief Financial Officer;
xxii. the appointment and/or reappointment of auditors of the Company; or
xxiii. any transaction involving both the Company (including any Subsidiary) and a shareholder of any Group Company or any of the Company’s employees, officers, directors or shareholders or any affiliate of a shareholder of any Group Company or any of such affiliate’s officers, directors or shareholders, except for intra-group transactions among the Company and any Subsidiaries and employment contracts between a Group Company and its employees that are not otherwise subject to this paragraph 7.3(h), and
(k2) the prior written approval of the holder(s) as at the date hereof (taking no account of any share issuances after the date hereof) of at least 96% of the aggregate of Ordinary Shares and preferred Shares (on an as-converted basis), provided that such requirement shall terminate upon a Qualified IPO, any repurchase or redemption of any equity securities of the Company other than (A) pursuant to agree contractual rights to repurchase Ordinary Shares from the employees, directors or undertake consultants of the Company upon termination of their employment or services or (B) pursuant to do a contractual right of first refusal held by the Company. Provided, however that, to the extent that the applicable laws prevent the Company from being bound by any of the foregoingabove provisions, such provisions shall be binding as amongst the holders of Ordinary Shares and holders of Preferred Shares and such parties shall take all actions necessary to give effect to such provisions.
Appears in 1 contract
Protective Provisions. 10.1 Approval At any time when at least twenty percent (20%) of the shares of Series A Preference Shares, E Preferred Stock and Series B Preference Shares, Series D Preference Shares. For so long E-1 Preferred Stock ever issued (taken together as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares a single class) (subject to adjustments made for share appropriate adjustment in the event of any stock dividend, stock split, subdivisioncombination or other similar recapitalization with respect to the Series E Preferred Stock or the Series E-1 Preferred Stock) are outstanding, consolidationthe Issuer shall not, reorganization and either directly or indirectly by amendment, merger, consolidation or otherwise, do any of the like events), following without (in addition to any other vote required by law or consent required elsewhere in the Memorandum and Articles or by applicable Law, Certificate of Incorporation) the Company shall not, and Members of the Company shall procure that the Company and each of its Subsidiaries shall not (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take any of the following actions (other than those in connection with a Non-Liquidation M&A) without the prior vote or written consent or affirmative vote of the holders of at least 50% a majority of the combined voting power of the then outstanding shares of Series D Preference SharesPreferred Stock, Series D-1 Preferred Stock, Series E Preferred Stock and Series E-1 Preferred Stock, including the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference Shares, each voting separately as a single class.Requisite Holders:
(a) to liquidatematerially and adversely alter or change the rights, dissolve preferences or wind up the affairs privileges of the Company, Series E Preferred Stock or effect any Liquidating TransactionSeries E-1 Preferred Stock;
(b) to amend, alter, increase or repeal any provision decrease the total number of the Memorandum and Articlesauthorized shares of Series E-1 Preferred Stock;
(c) to create any new class or authorize the creation series of or issue any other security convertible into or exercisable for any equity security, capital stock having rights, preferences or privileges senior to or on parity pari passu with the Series A Preference Shares, the E Preferred Stock or Series B Preference Shares or the Series D Preference Shares, or increase the authorized number of shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015E-1 Preferred Stock;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares unless approved by a majority of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement)Board of Directors, including the Requisite Directors, effect a Deemed Liquidation Event;
(e) liquidate, dissolve or wind-up the business and affairs of the Issuer or consent to do any of the foregoing;
(f) unless approved by a majority of the Board of Directors, including the Requisite Directors, purchase, license, lease or acquire (whether by asset purchase, stock purchase, merger, business combination or otherwise) any other business or division or any material rights or assets of another entity, in each case outside of the ordinary course of business, or cause any of its subsidiaries to do any of the foregoing;
(g) unless approved by a majority of the Board of Directors, including the Requisite Directors, sell, license, lease or otherwise dispose of (whether by asset sale stock sale, merger, business combination, license, partnership, joint venture, collaboration or otherwise) any business or division of the Issuer or any of its subsidiaries or any material rights, assets, clinical programs or intellectual property, or cause any of its subsidiaries to do any of the foregoing;
(h) unless approved by a majority of the Board of Directors, including the Requisite Directors, make any capital expenditure that is in excess of $300,000 if such expenditure was not included in a budget approved by the Board of Directors;
(i) amend or waive any provision of the Certificate of Incorporation or Bylaws;
(j) purchase or redeem (or permit any subsidiary to purchase or redeem redeem) or pay or declare any dividend on or make any distribution on, any shares of capital stock prior to of the Issuer other than (i) redemptions of the Series-A Preferred Stock, Series A Preference SharesA-1 Preferred Stock, the Series B Preference Shares or the Preferred Stock, Series C Preferred Stock, Series D Preference Shares Preferred Stock, Series D-1 Preferred Stock, Series E Preferred Stock and Series E-1 Preferred Stock as expressly authorized herein, (ii) dividends or other than distributions payable on the Common Stock solely in the form of additional shares of Common Stock and (iii) repurchases of stock repurchased from former employees employees, officers, directors, consultants or consultants other persons who performed services for the Issuer or any subsidiary in connection with the cessation of their employment/services, at such services pursuant to the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation terms of any debt security (other than equipment leases stock option or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Directorrestricted stock agreement;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(i) to take actions subject to other protective provisions to be set forth in the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financing;
(j) to approve and change any compensation package of the management of the Company, including but not limited to the chief executive officer, general manager, and any other key employee; and
(k) decrease or increase the authorized size of the Board of Directors;
(l) unless approved by the Board of Directors, including the Requisite Directors, incur indebtedness, including guaranties, letters of credit and capital leases by the Issuer, in excess of $300,000 in the aggregate in excess of any Board approved or budgeted amount, or enter into a material amendment to agree any instrument, document or undertake to do agreement evidencing such indebtedness;
(m) unless approved by the Board of Directors, including the Requisite Directors, acquire the stock or all or a substantial portion of the assets of any other entity that is not a wholly-owned subsidiary of the Issuer for aggregate consideration that exceeds $300,000;
(n) unless approved by the Board of Directors, including the Requisite Directors, adopt or amend any equity incentive plan; or
(o) unless approved by the Board of Directors, including the Requisite Directors, engage in, or cause any of its subsidiaries to engage in, in any material transactions with Affiliates (other than, with respect to the foregoingIssuer, with any of its wholly-owned subsidiaries, and with respect to subsidiaries of the Issuer, with the Issuer).
Appears in 1 contract
Sources: Investor Rights Agreement (Aileron Therapeutics Inc)
Protective Provisions. 10.1 Acts of the Group Companies Requiring Approval of Series A Preference Shares, Preferred Holders and Series B Preference SharesPreferred Holders. Regardless of anything else contained herein or in the Charter Documents of any Group Company, Series D Preference Shares. For so long as Bertelsmannno Group Company shall take, Sumitomo permit to occur, approve, authorize, or agree or commit to do any of the following, and BlueFocus respectively holds no less than 448,801 SharesParty shall permit any Group Company to, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events), in addition to any other vote or consent required elsewhere in the Memorandum and Articles or by applicable Law, the Company shall not, and Members shareholders of the Company shall procure that not permit the Company and each to take, permit to occur, approve, authorize, or agree or commit to do any of its Subsidiaries shall not (the following, whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement, amalgamation, or otherwise, unless approved in writing by the holders of two thirds of the voting power of the outstanding Series A Preferred Shares and Series B Preferred Shares (voting as a single class on an as-converted basis) in advance:
(i) any amendment or change of the rights, preferences, privileges or powers of, or the restrictions provided for the benefit of, the Series A Preferred Shares or the Series B Preferred Shares;
(ii) any action that authorizes, creates or issues (A) any class or series of Equity Securities of any Group Company having rights, preferences, privileges or powers superior to or on a parity with the Series A Preferred Shares or the Series B Preferred Shares, whether as to liquidation, conversion, dividend, voting, redemption, or otherwise, or (B) any other Equity Securities of any Group Company except for the Conversion Shares;
(iii) any action that reclassifies any outstanding shares into shares having rights, preferences, privileges or powers senior to or on a parity with the Series A Preferred Shares or the Series B Preferred Shares, whether as to liquidation, conversion, dividend, voting, redemption, or otherwise.
10.2 Acts of the Group Companies Requiring Approval of Series C Preferred Holders. Regardless of anything else contained herein or in the Charter Documents of any Group Company, no Group Company shall take, permit to occur, approve, authorize, or agree or commit to do any of the following, and no Party shall permit any Group Company to, and the shareholders of the Company shall not permit the Company to take, permit to occur, approve, authorize, or agree or commit to do any of the following, whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement arrangement, amalgamation, or otherwise, unless approved in writing by the holders of a majority of the voting power of the outstanding of Series C Preferred Shares:
(i) take any amendment or change of the rights, preferences, privileges or powers of, or the restrictions provided for the benefit of, the Series C Preferred Shares;
(ii) any action that authorizes, creates or issues (A) any class or series of Equity Securities of any Group Company having rights, preferences, privileges or powers superior to or on a parity with the Series C Preferred Shares, whether as to liquidation, conversion, dividend, voting, redemption, or otherwise, or (B) any other Equity Securities of any Group Company except for the Conversion Shares;
(iii) any action that reclassifies any outstanding shares into shares having rights, preferences, privileges or powers senior to or on a parity with the Series C Preferred Shares, whether as to liquidation, conversion, dividend, voting, redemption, or otherwise.
10.3 Acts of the Group Companies Requiring Approval of Preferred Holders. Regardless of anything else contained herein or in the Charter Documents of any Group Company, no Group Company shall take, permit to occur, approve, authorize, or agree or commit to do any of the following actions following, and no Party shall permit any Group Company to, and the shareholders of the Company shall not permit the Company to take, permit to occur, approve, authorize, or agree or commit to do any of the following, whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement, amalgamation, or otherwise, unless approved in writing by the holders of two thirds of the voting power of the outstanding Preferred Shares (voting as a single class on an as-converted basis) in advance, including the approval of a majority of the voting power of the outstanding of Series C Preferred Shares:
(i) any purchase, repurchase, redemption or retirements of any of the voting Equity Securities of any Group Company other than those pursuant to contractual rights to repurchase shares held by employees, directors or consultants of the Company or its Subsidiaries upon termination of their employment or services in connection accordance with the ESOP or the Restricted Share Agreements, or pursuant to the exercise of a Non-Liquidation M&Acontractual right of first refusal held by such Group Company, if any;
(ii) without any amendment or modification to or waiver under any of the prior vote Charter Documents of any Group Company, other than amendments pursuant to and in compliance with Section 12.17 hereof;
(iii) any declaration, set aside or written payment of a dividend or other distribution by any Group Company except for any distribution or dividend with respect to which the sole recipient of any proceeds therefrom is the Company;
(iv) any transaction (including but not limited to the termination, extension, continuation after expiry, renewal, amendment, variation or waiver of any term under agreement with respect to any transaction or series of transactions) with any Related Party;
(v) any sale, transfer, or other disposal of, or the incurrence of any Lien on, any substantial part of the assets of any Group Company;
(vi) the commencement of or consent to any proceeding seeking (i) to adjudicate it as bankrupt or insolvent, (ii) liquidation, winding up, dissolution, reorganization, or arrangement of any of the Group Companies under any Law relating to bankruptcy, insolvency or reorganization or relief of debtors, which is not resulted from or a part of the Trade Sale, or (iii) the entry of an order for relief or the appointment of a receiver, trustee, or other similar official for it or for any substantial part of its property;
(vii) any change of the size or composition of the board of directors of any Group Company other than changes pursuant to and in compliance with Section 9 hereof; or
(viii) any investment in, or divestiture or sale by any Group Company of an interest in a Subsidiary.
10.4 Acts of the Company Requiring Supermajority Approval of the Shareholders. Regardless of anything else contained herein or in the Charter Documents of any Group Company, no Group Company shall take, permit to occur, approve, authorize, or agree or commit to any Trade Sale, and no Party shall permit any Group Company to and the Shareholders of the Company shall not permit the Company to take, permit to occur, approve, authorize, or agree or commit to any Trade Sale, whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement, amalgamation, or otherwise, unless approved in writing by the holders of at least 5067% of the then voting power of all outstanding Series D Preference Shares, the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference Shares, each voting separately as a single class.
(a) to liquidate, dissolve or wind up the affairs of the Company, or effect any Liquidating Transaction;
(b) to amend, alter, or repeal any provision of the Memorandum and Articles;
(c) to create or authorize the creation of or issue any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, or increase the authorized number of shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant voting together as ESOP pursuant to this Agreementa single class and calculated on an as-converted basis);
, which consent must include the written consent of holders of a majority of outstanding Preferred Shares (e) to purchase or redeem or pay any dividend voting together as one class and on any capital stock prior to an as-converted basis), the written consent of holders of a majority of outstanding Series A Preference C Preferred Shares, and the Series B Preference Shares or the Series D Preference written consent of holders of a majority of outstanding Ordinary Shares (other than stock repurchased from former employees excluding the Ordinary Shares which the Preferred Shares are converted or consultants in connection with convertible into). After the cessation receipt of their employment/servicessuch consents and approvals, at the lower each Shareholder of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien onshall consent to such Trade Sale and do and perform, make a call on or forfeit any Shares held by BlueFocus representing cause to be done and performed, acts and things reasonably necessary to facilitate the unpaid Residual Amount (Trade Sale if any) such Trade Sale has been duly approved in accordance with this Section 10.4.
10.5 Acts of the Memorandum and Articles after July 1, 2015;
(f) to create Group Companies Requiring Preferred Directors Approval. Regardless of anything else contained herein or authorize in the creation Charter Documents of any debt security (other than equipment leases Group Company, no Group Company shall take, permit to occur, approve, authorize, or bank lines of credit) unless such debt security has received the prior approval agree or commit to do any of the Boardfollowing, including and no Party shall permit any Group Company to, and the shareholders of the Company shall not permit the Company to, take, permit to occur, approve, authorize, or agree or commit to do any of the following, whether in a single transaction or a series of related transactions, whether directly or indirectly, and whether or not by amendment, merger, consolidation, scheme of arrangement, amalgamation, or otherwise, unless approved by a majority of the board of directors of such Group Company (which majority must include the approval of the at least one Series A Director, the Series B Director and the Series D TBP Director, or their respective equivalents at the board of such Group Company):
(i) incurrence by the Group Companies of Indebtedness or guarantees of Indebtedness in excess of RMB500,000 individually or in the aggregate during any fiscal year;
(gii) to increase the purchase or decrease lease by the size Group Companies of the Boardany business and/or assets valued in excess of RMB1,000,000 individually during any fiscal year;
(hiii) to approve the investment by any change Group Company in any other Person in excess of RMB500,000 individually or in the business scope aggregate during any fiscal year;
(iv) the approval of, or activities any deviation from or amendment of, the annual budget of the any Group Company;
(iv) to take actions subject to the Section 11.6 below, the adoption, amendment or termination of the ESOP or any other protective provisions equity incentive, purchase or participation plan for the benefit of any employees, officers, directors, contractors, advisors or consultants of any of the Group Companies;
(vi) any loans to be employees;
(vii) the appointment or removal of the Auditors or the auditors for any other Group Company, or the change of the term of the fiscal year for any Group Company;
(viii) any public offering of any Equity Securities of any Group Company, other than a Qualified IPO;
(ix) any material change to the business scope, or nature of business of any Group Company, or cessation of any business line of any Group Company;
(x) any adoption of or change to, a significant tax or accounting practice or policy or any internal financial controls and authorization policies, or the making of any significant tax or accounting election; or
(xi) any other material actions or transaction which is not within the ordinary course of business of such Group Company consistent with its past practice, and which is beyond the business scope of applicable Group Company as set forth in the definitive agreements in connection with Recitals and the Series A financingnatural development, the Series B financing extension or the Series D financing;
(j) to approve and change any compensation package derivative of the management of businesses under the Company, including but not limited to the chief executive officer, general manager, and any other key employee; and
(k) to agree or undertake to do any of the foregoingaforesaid business scope.
Appears in 1 contract
Sources: Shareholder Agreements
Protective Provisions. 10.1 Approval of Series A Preference Shares, Series B Preference Shares, Series D Preference Shares. (a) For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 at least five million (5,000,000) Series A Shares (subject to adjustments made as adjusted for share split, subdivision, consolidation, reorganization and the like events), in addition to any other vote or consent required elsewhere in the Memorandum and Articles or by applicable LawRecapitalizations) remain outstanding, the Company shall not, and Members of the Company shall procure that the Company and each of its Subsidiaries shall not (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take any of the following actions (other than those in connection with a Non-Liquidation M&A) actions, either directly or indirectly by merger, consolidation, amendment to the Articles or otherwise, without first obtaining the prior vote or written consent of the holders of at least 50% a majority of the then outstanding Series D Preference Shares, the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference SharesShares then outstanding, each voting separately as a single class.:
(i) cause or permit the redemption, repurchase or other acquisition, directly or indirectly, of shares of the Company other than (A) the Company’s Ordinary Shares that are being repurchased at a price not higher than the original purchase price pursuant to option agreements or restricted share purchase agreements between the Company and any employees, officers, directors, consultants or service providers or pursuant to a right of first refusal held by the Company and (B) a redemption effected by the Company in accordance with Article 13 or Article 16 of the Articles to allow for the conversion of Preference Shares into Ordinary Shares;
(ii) declare or take any action resulting in payment of dividends or distributions with respect to the share capital of the Company (other than redemptions and repurchases permitted under (a) to liquidate, dissolve or wind up the affairs of the Company, or effect any Liquidating Transactionabove);
(biii) to amend, alter, increase or repeal any provision of the Memorandum and Articles;
(c) to create or authorize the creation of or issue any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, or increase decrease the authorized number of shares of any class or series of the Company’s share capital;
(iv) amend or determine any provisions of the Memorandum or the Articles, or change any rights, preferences, privileges or restrictions applicable to the holders of Series A Shares, except if there is no resulting materially disproportionate adverse effect on the holders of Series A Shares; provided, however, that the increase or decrease of authorized shares of any class or series of the Company’s share capital (other than the Series A Shares) or the authorization and issue of a new senior or pari passu class or series of securities shall not be deemed to have a materially disproportionate adverse effect on the holders of Series A Shares; provided, further, that consent shall not be required in connection with a Qualified IPO in which Preference SharesShares are converted into Ordinary Shares pursuant to Article 16 of the Articles;
(v) authorize, designate, reclassify, amend or issue, or obligate the Company to do any of the foregoing with respect to, any class or series of equity securities, including any security exercisable for or convertible into any equity security, which is or will be senior to or pari passu with, the Series A Shares with respect to any rights, preferences or privileges or restrictions other than the Series B Preference Shares or and Series B-1 Shares and any warrant issued in connection with the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders issuance of Series D B-1 Shares before the Company may enforce (and any paramount lien on, make a call on equity securities issued or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue issuable upon exercise of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreementsuch warrant);
(evi) a voluntary dissolution or liquidation of the Company; or
(vii) authorize, enter into or agree to purchase a Deemed Liquidation Event (with the exception of an Approved Sale) or redeem Recapitalization.
(b) For so long as at least five million (5,000,000) Series A Shares (as adjusted for Recapitalizations) remain outstanding, the Company shall not take any of the following actions, either directly or pay indirectly by merger, consolidation, amendment to the Articles or otherwise, without first obtaining the approval of a majority of the Board, including at least two (2) Series A Directors:
(i) incur any dividend indebtedness over US$500,000 other than trade payables incurred in the ordinary course of business;
(ii) change the number of directors on the Board;
(iii) adopt the annual budget and executive bonus goals; or
(iv) incur any capital stock prior or product development expenditures over US$1,000,000 cumulative to any single company, product or project, except as may be set forth in a budget that was previously approved by a majority of the Board, including at least two (2) Series A Preference Shares, the Directors.
(c) For so long as at least five million (5,000,000) Series B Preference Shares or the Series D B-1 Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/servicesas adjusted for Recapitalizations) remain outstanding, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce shall not take any paramount lien onof the following actions, make either directly or indirectly by merger, consolidation, amendment to the Articles or otherwise, without first obtaining the approval of a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval majority of the Board, including the approval Series B-1 Director (as defined in the Articles):
(i) amend or determine any provisions of the Memorandum or the Articles, or change any rights, preferences, privileges or restrictions applicable to the holders of Series A DirectorB-1 Shares, except if there is no resulting materially disproportionate adverse effect on the holders of Series B-1 Shares; provided, however, that the increase or decrease of authorized shares of any class or series of the Company’s share capital (other than the Series B Director B-1 Shares) or the authorization and issue of a new senior or pari passu class or series of securities shall not be deemed to have a materially disproportionate adverse effect on the holders of Series D DirectorB-1 Shares; provided, further, that consent shall not be required in connection with a Qualified IPO in which Preference Shares are converted into Ordinary Shares pursuant to Article 16 of the Articles;
(gii) to increase sale or decrease the size disposition of the Boardwhole or a substantial part (more than 25% of the assets on a consolidated basis) of the business, goodwill or assets of the Company or any material subsidiary of the Company through sale, merger, acquisition, consolidation, or reorganization involving a change of control of the company in which the consideration for the Company taken as a whole is less than US$700,000,000 (less any required withholding, holdbacks or escrows);
(hiii) to approve any change in the business scope a voluntary dissolution or activities liquidation of the Company;
(iv) change or expansion of the business scope of the Company;
(v) any acquisition of or any investments in entities or businesses outside of the existing business scope of the company or any acquisition involving consideration in excess of US$20,000,000;
(vi) cause or permit the redemption, repurchase or other acquisition, directly or indirectly, of shares of the Company other than (A) the Company’s Ordinary Shares that are being repurchased at a price not higher than the original purchase price pursuant to option agreements or restricted share purchase agreements between the Company and any employees, officers, directors, consultants or service providers or pursuant to a right of first refusal held by the Company and (B) a redemption effected by the Company in accordance with Article 13 or Article 16 of the Articles to allow for the conversion of Preference Shares into Ordinary Shares; or
(vii) authorize, enter into or agree to a Deemed Liquidation Event (with the exception of an Approved Sale) or Recapitalization.
(d) For so long as at least five million (5,000,000) Series B-1 Preference Shares (as adjusted for Recapitalizations) remain outstanding, the Company shall not take any of the following actions, either directly or indirectly by merger, consolidation, amendment to the Articles or otherwise, without first obtaining the approval of: (i) to take actions subject the extent there are six (6) or more Directors sitting on the Board, five (5) Directors and (ii) to other protective provisions to be set forth in the definitive agreements in connection with extent there are five (5) or fewer Directors sitting on the Board, a majority of the Board including at least one (1) of the Series A financingB-1 Director, the Series B financing Ordinary Share Director or the Independent Director:
(i) approval of any related party transaction (or series of related transactions) involving consideration or value in excess of US$20,000; provided that the interested director(s) (if any) shall be required to disclose their interest therein and abstain from deliberation and voting therefor (but shall be counted for the purposes of quorum); provided further that if the previous proviso is not met, such transaction(s) must be approved by a majority of the Board, including the Series D financingB-1 Director if such Director is not an interested director;
(jii) to approve incur additional indebtedness, commitments or guarantees of indebtedness in excess of US$5,000,000;
(iii) approval of any new option plans or other equity incentive arrangements or grant of incentive options;
(iv) approval of annual budget or material amendment thereof;
(v) any single expenditure in excess of US$1,000,000 or expenditures in excess of US$5,000,000 in any 12-month period which are not included in an approved annual budget;
(vi) determination of timing, venue and change valuation of any compensation package IPO of the management Company other than a Qualified IPO; or
(vii) appointment of the Company, including but not limited to the chief executive officer, general manager, and any other key employee; and
(k) to agree or undertake to do any of the foregoing’s corporate officers.
Appears in 1 contract
Protective Provisions. 10.1 Approval of Series A Preference SharesIn addition to such other limitations as may be provided in the Articles, Series B Preference Shares, Series D Preference Shares. For for so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 any Preferred Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events), in addition to any other vote or consent required elsewhere in the Memorandum and Articles or by applicable Laware outstanding, the Company shall not, and Members following acts of the Company shall procure that require the prior written approval of the Preferred Majority, or the written approval of more than fifty percent (50%) of the directors of the Board (including the approval of each Investor Director), as the case maybe. For the purpose of this Section 8, the term “Company” means, the Company itself as well as any and each of its Subsidiaries shall not (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take any all the subsidiaries of the following actions Company (including but not limited to the other than those in connection with Group Companies), to the extent and where applicable. Notwithstanding anything to the contrary contained herein, where any such action requires a Non-Liquidation M&A) without the prior vote special resolution or written consent ordinary resolution of the holders of at least 50% shareholders in accordance with the Companies Law (Revised) of the then outstanding Series D Preference SharesCayman Islands and if the shareholders vote in favor of such act but the approval of the Preferred Majority has not yet been obtained, the holders of the Preferred Shares who vote against such act at least 50% a meeting of the then outstanding Series B Preference Shares and shareholders in aggregate shall have the holders voting rights equal to the aggregate voting power of at least 50% all the shareholders who voted in favor of the then outstanding Series A Preference Shares, each voting separately as a single classsuch act plus one.
(a) to liquidate, dissolve any issuance or wind up the affairs sale of any equity or debt securities of the Company, excluding any issuance of Class A Ordinary Shares upon conversion of the Preferred Shares (including, without limitation, the creation, issuance, sale or effect sponsorship of any Liquidating Transactioncryptocurrency, decentralized application tokens, protocol tokens, blockchain-based assets or other cryptofinance coins, tokens or similar digital assets by the Company, an officer of the Company or any direct or indirect majority-owned subsidiary of the Company);
(b) to amendany amendment or change of the rights, alterpreferences, privileges or powers of, or repeal any provision the restrictions provided for the benefit of the Memorandum and ArticlesPreferred Shares;
(c) to create any action that authorizes, creates or authorize the creation of or issue issues any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, or increase the authorized number class of shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding capital of the holders of Company having preferences superior to or on a parity with the Series A Preference Preferred Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) any action that reclassifies any outstanding shares into shares having preferences or priority as to create, dividends or issue of any debenture assets superior to or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares on a parity with the preference of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement)Preferred Shares;
(e) any act that repurchases, redeems or retires any of the Company’s voting securities (excluding (i) pursuant to purchase or redeem or pay any dividend on any capital stock prior contractual rights to the Series A Preference Shares, the Series B Preference repurchase Ordinary Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Preferred Shares held by BlueFocus representing employees, directors or consultants of the unpaid Residual Amount Company or its subsidiaries upon termination of their employment or services, or pursuant to the exercise of a contractual right of first refusal held by the Company, or (if anyii) the redemption entitled by the holders of relevant class or series of shares as set forth in accordance with the Memorandum and Articles after July 1, 2015Articles);
(f) to create any increase or authorize decrease in the creation of any debt security (other than equipment leases authorized share capital or bank lines of credit) unless such debt security has received the prior approval registered capital, as applicable, of the Board, including the approval of the Series A Director, the Series B Director and the Series D DirectorCompany;
(g) to increase or decrease the size any amendment of the BoardCompany’s Memorandum and Articles of Association or other charter documents of the Company;
(h) to approve the declaration or payment of a dividend or other distributions on any change in the business scope or activities securities of the Company;
(i) any increase or decrease of the authorized size of the board of directors of the Company, or any amendment of the rules to take actions subject to other protective provisions to be set forth in appoint or remove the definitive agreements in connection with directors of the Series A financing, the Series B financing or the Series D financingCompany;
(j) to approve and change any compensation package the liquidation, dissolution or winding up of the management Company;
(k) any consolidation, merger, corporate reorganization, transaction or series of transactions of the founder, in which in excess of fifty percent (50%) of the Company’s voting power is transferred or in which all or substantially all the assets of the Company are sold;
(l) the sale of all or substantially all of any of the Company’s assets, or any material asset or undertaking of the Company;
(m) any Transfer of the shares or equity interest of the Company directly or indirectly held by the Founder, or dispose of or dilute the Company’s interest, directly or indirectly, in any of its subsidiaries, unless otherwise provided herein;
(n) any establishment, alteration or termination of any profit sharing scheme or any employee share option or share participation schemes, or any grant of options or warrants under such scheme;
(o) incurrence of debt or assumption of any loan, facility or other financial obligation from a third party, or issue, assumption, provision of guarantee, charge, lien or indemnity warranty in favor of a third party, or creation of any liability (including without limitation any off-balance-sheet liability or contingent liability) by the Company, in excess of RMB3,000,000 in the aggregate in any consecutive twelve (12) months period outside the annual budget of the Company, or extension of loan by the Company to any third party in excess of RMB3,000,000 in the aggregate in any consecutive twelve (12) months period outside the annual budget of the Company, other than those in the ordinary course of business;
(p) creation of any liability on any patent, copy right, trademark, or any other intellectual property right of the Company;
(q) the initial public offering of any of the Shares or other equity or debt securities of the Company (or as the case may be, the shares or securities of the relevant entity resulting from any merger, reorganization or other arrangements made by or to the Company for the purposes of public offering);
(r) any equity investments in any other person or entity (including any direct or indirect establishment or any acquisition of any subsidiary);
(s) approval or removal of the auditor of the Company;
(t) any material change to the business of the Company, including but not limited entering new lines of business outside the existing business and exiting the current business;
(u) termination or any material amendment to the chief executive officer, general manager, and any other key employee; andRestructuring Documents (as defined in the Share Purchase Agreement);
(kv) to agree settlement of litigation, arbitration or undertake other disputes involving value of no less than US$500,000 in a single transaction or no less than US$3,000,000 in the aggregate in any consecutive twelve (12) months;
(w) appointment or removal of the Chief Executive Officer, Chief Financial Officer, Chief Technology Officer, Chief Operating Officer;
(x) approval or material amendment (by more than 30% in any fiscal year) of the annual budget; or
(y) agreement or commitment by the Company to do any of the foregoing.
Appears in 1 contract
Protective Provisions. 10.1 Approval of Series A Preference Shares, Series B Preference Shares, Series D Preference Shares. For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events), in In addition to any such other vote or consent required elsewhere limitations as may be provided in the Memorandum and Articles or by applicable Lawand the BVI Business Companies ▇▇▇ ▇▇▇▇, the Company shall not, and Members shall cause the other Group Companies to not, and the holders of Ordinary Shares shall exercise all of their rights with respect to such Ordinary Shares so as to cause the Company shall procure that the Company and each of its Subsidiaries shall not (directly Group Companies to not, effect or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take otherwise consummate any of the following actions acts without first obtaining,
(other than those in connection with a Non-Liquidation M&A1) without the prior vote or written consent approval of (i) the holder(s) of at least 75% of the holders outstanding Series A Shares and Series A1 Shares (in aggregate and on an as-converted basis), and (ii) the holder(s) of at least 50% of the then outstanding Series D Preference Shares, the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% (on an as converted basis); provided that such requirement shall terminate upon a Qualified Public Offering:
i. any amendment or change of the then outstanding Series A Preference Sharesrights, each voting separately as a single class.
(a) to liquidatepreferences, dissolve privileges or wind up the affairs of the Companypowers of, or effect any Liquidating Transaction;
(b) to amend, alter, or repeal any provision of the Memorandum and Articles;
(c) to create or authorize restrictions provided for the creation of or issue any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Sharesbenefit of, the Series B Preference Preferred Shares or the Series D Preference Shares, or increase the authorized number of shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(i) ii. any action to take actions subject authorize, create or issue shares of any class or series of the Company having preferences superior to other protective provisions to be set forth in the definitive agreements in connection or on a parity with the Series A financingPreferred Shares in any aspects including without limitation, the Series B financing or the Series D financingdividend rights, redemption rights and/or liquidation rights;
(j) to approve and change iii. any compensation package new issuance of the management any equity securities of the Company, including any change in the total number of authorized Series B Shares, but not limited excluding (i) any issuance of the Series B Shares authorized under the Purchase Agreement, (ii) any issuance of Ordinary Shares upon conversion of the Preferred Shares, and (iii) the issuance of 66,580 Ordinary Shares reserved for issuance upon the exercise of the option currently held by Winsome Group Limited on behalf of Ma ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ Ho, Ma Wen Lie, ▇▇▇▇ Lo Yin and other officers, employees and advisors of the Company, and (iv) the issuance of up to 151,430 Ordinary Shares (and/or options or warrants therefor) reserved for issuance pursuant to the chief executive employee equity incentive plans approved by the Compensation Committee (as defined in the Articles);
iv. any action of the Company to reclassify any outstanding shares into shares having preferences or priority as to dividends or assets senior to or on a parity with the preference of the Preferred Shares;
v. any increase or decrease of the authorized number of Ordinary Shares or Preferred Shares of the Company;
vi. any amendment of the Memorandum and Articles of Association or other charter documents of the Company (including any Major Subsidiary);
vii. any merger or consolidation of the Company (including any Subsidiary) with or into any other business entity in which the shareholders of the Company (including any Subsidiary) immediately after such merger or consolidation held shares representing less than a majority of the voting power of the outstanding share capital of the surviving business entity;
viii. any transaction or series of transactions that would result in a change of control of the Company (including any Subsidiary);
ix. the sale, lease, transfer or other disposition of all or substantially all of the assets of the Company (including any Subsidiary), except for intra-group transactions among the Company and any Subsidiaries;
x. any licensing or other transfer of the patents, copyrights, trademarks or other intellectual property of the Company (including any Subsidiary) other than in the ordinary course of its business, except for intra-group transactions among the Company and any Subsidiaries;
xi. any increase or decrease of the authorized number of the Board (including any committees of the Board) of the Company;
xii. effect a liquidation, dissolution or winding up of the Company (including any Subsidiary);
xiii. the declaration or payment of a dividend or other distribution on Ordinary Shares or Preferred Shares of the Company;
xiv. any increase of the number of Ordinary Shares of the Company reserved under any employee equity incentive plan;
xv. any increase in compensation of any employee of the Company (including any Subsidiary) with an annual salary of US$50,000 or more by more than 20% in a twelve (12) month period;
xvi. the extension by the Company of any loan or guarantee for indebtedness to any director, officer, general manageremployee or affiliate of the Company (including any Subsidiary), except for intra-group transactions among the Company and any Subsidiaries;
xvii. any incurrence of indebtedness in excess of US$1,000,000 in the aggregate to the Company (including any Subsidiary), or creation of any encumbrance whatsoever upon the assets, patents, copyrights, trademarks or other intellectual property of the Company (including any Subsidiary);
xviii. any purchase by the Company (including any Subsidiary) of real property with a value of US$1,000,000 or more, or any purchase of production facilities with a value of US$500,000 or more, individually or in the aggregate;
xix. any transaction or series of transactions that are not in the ordinary course of the Company’s business where the value involved exceeds US$1,000,000, individually or in the aggregate, during any twelve (12) month period;
xx. approval of the annual consolidated budget of the Company;
xxi. the appointment and removal of any key employeeofficer of the Company (including any Major Subsidiary), including the Chief Executive Officer and the Chief Financial Officer;
xxii. the appointment and/or reappointment of auditors of the Company; or
xxiii. any transaction involving both the Company (including any Subsidiary) and a shareholder of any Group Company or any of the Company’s employees, officers, directors or shareholders or any affiliate of a shareholder of any Group Company or any of such affiliate’s officers, directors or shareholders, except for intra-group transactions among the Company and any Subsidiaries and employment contracts between a Group Company and its employees that are not otherwise subject to this paragraph 7.3(h), and
(k2) the prior written approval of the holder(s) as at the date hereof (taking no account of any share issuances after the date hereof) of at least 96% of the aggregate of Ordinary Shares and Preferred Shares (on an as-converted basis), provided that such requirement shall terminate upon a Qualified IPO, any repurchase or redemption of any equity securities of the Company other than (A) pursuant to agree contractual rights to repurchase Ordinary Shares from the employees, directors or undertake consultants of the Company upon termination of their employment or services or (B) pursuant to do a contractual right of first refusal held by the Company. Provided, however that, to the extent that the applicable laws prevent the Company from being bound by any of the foregoingabove provisions, such provisions shall be binding as amongst the holders of Ordinary Shares and holders of Preferred Shares and such parties shall take all actions necessary to give effect to such provisions.
Appears in 1 contract
Sources: Share Subscription Agreement (Le Gaga Holdings LTD)
Protective Provisions. 10.1 Approval of Series A Preference SharesThe Partnership and the General Partner hereby covenant and agree that, Series B Preference Shares, Series D Preference Shares. For so for as long as Bertelsmannany Preferred Units are outstanding, Sumitomo and BlueFocus respectively holds no less than 448,801 Sharesneither the Partnership nor the General Partner shall, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events)Partnership and the General Partner shall cause their respective Subsidiaries not to, in addition to any other vote undertake or consent required elsewhere in the Memorandum and Articles or by applicable Law, the Company shall not, and Members of the Company shall procure that the Company and each of its Subsidiaries shall not (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take permit any of the following actions (other than those in connection with a Non-Liquidation M&A) actions, directly or indirectly, without the prior vote or written consent of the holders of at least 50% of the then outstanding Series D Preference Shares, the holders record of at least 50% a majority of the Preferred Units then outstanding Series B Preference Shares and outstanding:
(1) in the holders of at least 50% case of the then outstanding Series A Preference SharesPartnership, each voting separately as a single class.
(a) to liquidate, dissolve authorize or wind up the affairs of the Company, or effect any Liquidating Transaction;
(b) to amend, alter, or repeal any provision of the Memorandum and Articles;
(c) to create or authorize the creation of or issue any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Sharesissue, or increase the authorized number or issued amount of, (A) equity securities ranking, as to distributions and upon liquidation, on a parity with or senior to the Preferred Units or (B) Common Units or other equity securities ranking, as to distributions and upon liquidation, junior to the Preferred Units, to the extent that such Common Units or other junior equity securities contain any rights that restrict in any way management of the Partnership, the General Partner or their respective Subsidiaries or would reasonably be expected to interfere with the Preferred Units or the rights of the holders thereof; and (2) in the case of the General Partner, any Subsidiary of the General Partner or any Subsidiary of the Partnership, authorize or issue additional (A) shares of preferred stock or preferred equity securities or (B) shares of common stock or common equity securities or other equity securities ranking, as to distributions and upon liquidation, junior to shares of such entity’s preferred stock or preferred equity securities, to the extent that such shares of common stock, common equity securities or other junior equity securities contain any rights that restrict in any way management of the General Partner, the Partnership or their respective Subsidiaries or would reasonably be expected to interfere with the Preferred Units or the rights of the holders thereof;
(ii) amend, alter, repeal or waive any of the provisions of (1) this Amendment, the Purchase Agreement or any of the other Transaction Documents or the transactions contemplated hereby or thereby or (2) the certificate of limited partnership of the Partnership, the Partnership Agreement, the Articles of Incorporation or bylaws of the General Partner or the organizational documents of any of their respective Subsidiaries, in the case of clause (2) only, to the extent that such amendment would reasonably be expected to adversely affect the Preferred Units or, in the event that any Preferred Units have been exchanged for Series A Preferred Shares pursuant to Section 10, the Series A Preference SharesPreferred Shares or the respective rights of the holders thereof;
(iii) incur, renew, refinance, modify or otherwise discharge any Indebtedness of the Partnership, the General Partner or any of their respective Subsidiaries, or extend credit, make a loan or become a guarantor or surety for debt of another party, to the extent that any such action would cause a breach, violation of or failure to meet one or more of the Financial Covenants;
(iv) redeem, purchase or otherwise acquire for any consideration (1) in the case of the Partnership, equity securities of the Partnership that rank, as to distributions and upon liquidation, junior to the Preferred Units, including Common Units, and (2) in the case of the General Partner, any Subsidiary of the General Partner or any Subsidiary of the Partnership, any class or series of capital stock or equity securities; provided, that the foregoing shall not prohibit the following: (A) redemptions pursuant to the Share Redemption Program so long as a Cash Flow Sweep Event is not in effect; (B) redemptions of Common Units in exchange for which the General Partner issues REIT Shares to the holders of such Common Units as the sole consideration therefor pursuant to the terms of the Partnership Agreement; and (C) redemptions of Common Units for cash pursuant to the terms of the Contribution Agreements in an aggregate amount not to exceed $5.0 million;
(v) hold assets or engage in any business outside the Partnership, the General Partner or their respective Subsidiaries;
(vi) engage in any transaction with an Affiliate of the Partnership, the General Partner or their respective Subsidiaries or amend an agreement with any such Affiliate to the extent that such transaction or amendment would reasonably be expected to adversely affect the Preferred Units or, in the event that any Preferred Units have been exchanged for Series A Preferred Shares pursuant to Section 10, the Series B Preference A Preferred Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding rights of the respective holders thereof; provided, that the foregoing shall not prohibit the following: (1) transactions described in the Advisory Agreement or in one or more of the Series A Preference Shares, Property Management Agreements with the Series B Preference Shares or Property Manager; (2) the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares annual approval of the Company Advisory Agreement by the independent members of the Board of Directors of the General Partner, as required by the Advisory Agreement; and (other than grant stock options 3) transactions contemplated as of the Date of Issuance to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to be entered into by the Series A Preference Shares, Partnership and the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants General Partner in connection with the cessation DST Program or other Affiliated contributions or exchanges;
(vii) engage in a Change of Control;
(viii) commence or suffer to exist an Event of Bankruptcy as to the Partnership, the General Partner or any of their employment/servicesrespective Subsidiaries;
(ix) pay any special distributions (which, at for purposes hereof, shall mean any distribution other than a distribution made on a regular monthly basis consistent with past practice) on (1) in the lower case of fair market value the Partnership, Common Units or cost)other equity securities that rank, provided thatas to distributions and upon liquidation, no vote junior to the Preferred Units and (2) in the case of the General Partner, any Subsidiary of the General Partner or written any Subsidiary of the Partnership, shares of common stock or common equity securities or other equity securities that rank, as to distributions and upon liquidation, junior to such entity’s shares of preferred stock or preferred equity securities; provided, that the foregoing shall not prohibit special distributions that are (x) made pursuant to and in accordance with Section 7(a) or 7(b) or (y) necessary to preserve the General Partner’s status as a REIT under the Code; or
(x) engage in a recapitalization, reorganization, merger, unit or stock split, statutory unit or stock exchange, sale of all or substantially all of such entity’s assets, tender offer for all or substantially all of its Common Units, shares of common stock or other common equity securities, as the case may be, or other similar transaction. Neither the Partnership nor the General Partner shall take, and shall cause their respective Subsidiaries not to take, any action in furtherance of any of the foregoing actions without obtaining the required consent under therefor, as specified in this Section 7(d). Notwithstanding any provision in this Section 7(d) to the contrary, the Partnership shall be required from able to enter into tax protection agreements in the Holders ordinary course of its business. In the event that any Preferred Units have been exchanged for Series D A Preferred Shares before pursuant to Section 10, then the Company may enforce any paramount lien onGeneral Partner, make a call on as the holder of such exchanged Preferred Units, shall provide or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if anywithhold its consent pursuant to this Section 7(d) in accordance with the Memorandum determination of (and Articles after July 1, 2015;
(fin the same proportion as) the holders of such Series A Preferred Shares pursuant to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval terms of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(i) to take actions subject to other protective provisions to be set forth in the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financing;
(j) to approve and change any compensation package of the management of the Company, including but not limited to the chief executive officer, general manager, and any other key employee; and
(k) to agree or undertake to do any of the foregoingArticles Supplementary.
Appears in 1 contract
Sources: Limited Partnership Agreement (Griffin Capital Essential Asset REIT, Inc.)
Protective Provisions. 10.1 Approval of Series A Preference Shares, Series B Preference Shares, Series D Preference Shares. For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events), in In addition to any such other vote or consent required elsewhere limitations as may be provided in the Memorandum and Articles or by applicable Lawand the BVI Business Companies ▇▇▇ ▇▇▇▇, the Company shall not, and Members shall cause the other Group Companies to not, and the holders of Ordinary Shares shall exercise all of their rights with respect to such Ordinary Shares so as to cause the Company shall procure that the Company and each of its Subsidiaries shall not (directly Group Companies to not, effect or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) take otherwise consummate any of the following actions (other than those in connection with a Non-Liquidation M&A) acts without first obtaining.
7.1 the prior vote or written consent approval of (i) the holder(s) of at least 75% of the holders outstanding Series A Shares and Series A1 Shares (in aggregate and on an as-converted basis), and (ii) the holder(s) of at least 50% of the then outstanding Series D Preference Shares, the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference Shares, each voting separately B1 Shares (in aggregate and on an as converted basis); provided that such requirement shall terminate upon a single class.Qualified Public Offering:
(a) to liquidate, dissolve any amendment or wind up the affairs change of the Companyrights, preferences, privileges or powers of, or effect any Liquidating Transaction;
(b) to amend, alter, or repeal any provision of the Memorandum and Articles;
(c) to create or authorize restrictions provided for the creation of or issue any other security convertible into or exercisable for any equity security, having rights, preferences or privileges senior to or on parity with the Series A Preference Sharesbenefit of, the Series B Preference Preferred Shares or the Series D Preference Shares, or increase the authorized number of shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities of the Company;
(b) any action to authorize, create or issue shares of any class or series of the Company having preferences superior to or on a parity with the Preferred Shares in any aspects including without limitation, dividend rights, redemption rights and/or liquidation rights;
(c) any new issuance of any equity securities of the Company, including any change in the total number of authorized Series B Shares and Series B1 Shares, but excluding (i) any issuance of the Series B1 Shares authorized under the Purchase Agreement, (ii) any issuance of Ordinary Shares upon conversion of the Preferred Shares, (iii) the issuance of 66,580 Ordinary Shares upon the exercise of the option currently held by Winsome Group Limited on behalf of Ma ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ Ho, Ma Wen Lie, ▇▇▇▇ Lo Yin, Li Jin and other officers, employees and advisors of the Company, (iv) the issuance of up to take actions subject 151,430 Ordinary Shares (or options or warrants therefor) pursuant to other protective provisions employee equity incentive plans approved by the Compensation Committee, and (v) the issuance of up to be set forth in 50,246 Ordinary Shares upon the definitive agreements in connection exercise of the options granted to certain individuals pursuant to the resolutions of the Company’s directors passed on April 16, 2009;
(d) any action of the Company to reclassify any outstanding shares into shares having preferences or priority as to dividends or assets senior to or on a parity with the Series A financingpreference of the Preferred Shares;
(e) any increase or decrease of the authorized number of Ordinary Shares or Preferred Shares of the Company;
(f) any amendment of the Memorandum and Articles of Association or other charter documents of the Company (including any Major Subsidiary);
(g) any merger or consolidation of the Company (including any Subsidiary other than Linong Agriculture Technology Co., Ltd. (Tianjin)) with or into any other business entity in which the Series B financing shareholders of the Company (including any Subsidiary) immediately after such merger or consolidation held shares representing less than a majority of the Series D financingvoting power of the outstanding share capital of the surviving business entity;
(h) any transaction or series of transactions that would result in a change of control of the Company (including any Subsidiary other than Linong Agriculture Technology Co., Ltd. (Tianjin));
(i) the sale, lease, transfer or other disposition of all or substantially all of the assets of the Company (including any Subsidiary other than Linong Agriculture Technology Co., Ltd. (Tianjin)), except for intra-group transactions among the Company and any Subsidiaries;
(j) to approve and change any compensation package licensing or other transfer of the management patents, copyrights, trademarks or other intellectual property of the CompanyCompany (including any Subsidiary) other than in the ordinary course of its business, including but not limited to except for intra-group transactions among the chief executive officer, general manager, Company and any other key employee; andSubsidiaries;
(k) any increase or decrease of the authorized number of the members of the Board (including any committees of the Board) of the Company;
(l) effect a liquidation, dissolution or winding up of the Company (including any Subsidiary other than Linong Agriculture Technology Co., Ltd. (Tianjin));
(m) the declaration or payment of a dividend or other distribution on Ordinary Shares or Preferred Shares of the Company;
(n) any increase of the number of Ordinary Shares of the Company reserved under any employee equity incentive plan;
(o) any increase in compensation of any employee of the Company (including any Subsidiary) with an annual salary of US$50,000 or more by more than 20% in a twelve (12) month period;
(p) the extension by the Company of any loan or guarantee for indebtedness to agree any director, officer, employee or undertake affiliate of the Company (including any Subsidiary), except for intra-group transactions among the Company and any Subsidiaries;
(q) any incurrence of indebtedness in excess of US$1,000,000 in the aggregate to do the Company (including any Subsidiary), or creation of any encumbrance whatsoever upon the assets, patents, copyrights, trademarks or other intellectual property of the Company (including any Subsidiary);
(r) any purchase by the Company (including any Subsidiary) of real property with a value of US$1,000,000 or more, or any purchase of production facilities with a value of US$500,000 or more, individually or in the aggregate;
(s) any transaction or series of transactions that are not in the ordinary course of the Company’s business where the value involved exceeds US$1,000,000, individually or in the aggregate, during any twelve (12) month period, except for the disposition of any equity interest in, and/or any asset of, Linong Agriculture Technology Co., Ltd. (Tianjin));
(t) approval of the annual consolidated budget of the Company;
(u) the appointment and removal of any key officer of the Company (including any Major Subsidiary), including the Chief Executive Officer and the Chief Financial Officer;
(v) the appointment and/or reappointment of auditors of the Company; or
(w) any transaction involving both the Company (including any Subsidiary) and a shareholder of any Group Company or any of the foregoingCompany’s employees, officers, directors or shareholders or any affiliate of a shareholder of any Group Company or any of such affiliate’s officers, directors or shareholders, except for intra-group transactions among the Company and any Subsidiaries and employment contracts between a Group Company and its employees that are not otherwise subject to this Section 7, and
7.2 the prior written approval of the holder(s) as at the date hereof (taking no account of any share issuances after the date hereof) of at least 96% of the aggregate of Ordinary Shares and Preferred Shares (on an as-converted basis), provided that such requirement shall terminate upon a Qualified IPO, any repurchase or redemption of any equity securities of the Company other than (A) pursuant to contractual rights to repurchase Ordinary Shares from the employees, directors or consultants of the Company upon termination of their employment or services or (B) pursuant to a contractual right of first refusal held by the Company. Provided, however that, to the extent that the applicable laws prevent the Company from being bound by any of the above provisions, such provisions shall be binding as amongst the parties hereto (other than the Company) and such parties shall take all actions necessary to give effect to such provisions.
Appears in 1 contract
Sources: Share Subscription Agreement (Le Gaga Holdings LTD)
Protective Provisions. 10.1 Approval of Series A Preference Shares, Series B Preference Shares, Series D Preference Shares. For so long as Bertelsmannat least 9,500 shares of Series G Preferred Stock, Sumitomo Series I Preferred Stock, Series J Preferred Stock, Series K Preferred Stock, Series L Preferred Stock and BlueFocus respectively holds no less than 448,801 SharesSeries M Preferred Stock collectively remain outstanding, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events), in addition to any other affirmative vote or consent required elsewhere in the Memorandum and Articles or by applicable Law, the Company shall not, and Members of the Company holders of two-thirds (2/3) of the issued and outstanding shares of Series G Preferred Stock, Series I Preferred Stock, Series J Preferred Stock, Series K Preferred Stock, Series L Preferred Stock and Series M Preferred Stock, voting together as a single class and on an as converted to Common Stock basis, shall procure that the Company and each of its Subsidiaries shall not (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwise) be required to take any of the following actions (other than those in connection with a Nonincluding by way of merger, consolidation or otherwise):
(i) designate, authorize, create, issue, sell, redeem or repurchase any class or series of equity securities or equity-Liquidation M&A) without the prior vote or written consent backed securities of the holders Company or any subsidiary thereof, including without limitation, capital stock (including any shares of at least 50% of the then outstanding Series D Preference Sharestreasury stock) or rights, the holders of at least 50% of the then outstanding Series B Preference Shares and the holders of at least 50% of the then outstanding Series A Preference Sharesoptions, each voting separately as a single class.
(a) to liquidate, dissolve warrants or wind up the affairs of the Company, or effect any Liquidating Transaction;
(b) to amend, alter, or repeal any provision of the Memorandum and Articles;
(c) to create or authorize the creation of or issue any other security securities convertible into or exercisable or exchangeable for capital stock or any debt security which by its terms is convertible into or exchangeable for any equity securitysecurity or has any other equity feature or any security that is a combination of debt and equity (collectively, having rights"Equity Securities"), preferences or privileges senior other than pursuant to or on parity with (i) employee stock option and similar incentive plans approved by the Series A Preference SharesBoard of Directors, (ii) the Series B Preference Shares or issuance of Common Stock upon the Series D Preference Shares, or increase the authorized number of shares conversion of the Series A Preference Shares, 7.5% Convertible Subordinated Notes due 2007 of Allied Riser Communications Corporation (the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any"Notes") in accordance with the Memorandum and Articles after July 1, 2015terms thereof or the issuance of additional convertible debt or equity as a paid-in-kind interest payment on the Notes in accordance with the terms thereof approved by the Board of Directors or (iii) a conversion or exchange right set forth in Company's certificate of incorporation;
(fii) to create except as otherwise expressly provided as of the date hereof in the Company's certificate of incorporation or authorize the creation in a certificate of designations thereto, declare or pay any dividends or make any distributions of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval kind with respect to any outstanding Equity Securities of the Board, including the approval of the Series A Director, the Series B Director and the Series D DirectorCompany or any subsidiary thereof;
(giii) to approve the merger, consolidation, dissolution or liquidation of the Company or any subsidiary thereof, or any transaction having the same effect;
(iv) increase or decrease the size aggregate number of the Board;
(h) to approve any change in the business scope authorized shares of Common Stock or activities Preferred Stock of the Company;
(iv) to take actions subject to sell all or substantially all of the assets of the Company and its subsidiaries taken as a whole, whether directly through a sale of the Company's interests in its subsidiaries or other protective provisions to be set forth assets, or indirectly through a sale of the assets of its subsidiaries, in one transaction or any series of transactions, or approve any transaction or series of transactions having the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financingsame effect;
(jvi) to approve and cause, directly or indirectly, a material change any compensation package in the nature of the management business or strategic direction of the Company and its subsidiaries, taken as a whole;
(vii) approve the filing for bankruptcy of or any decision not to take action to prevent a filing for bankruptcy or not to oppose an involuntary filing for bankruptcy or other winding up of the Company or any subsidiary thereof;
(viii) approve the establishment and maintenance of an Executive Committee of the Board of Directors or increase or decrease the number of directors composing the Board of Directors; or
(ix) amend, repeal or modify any provision of the Company's certificate of incorporation in a manner that adversely affects the rights, including but not limited to the chief executive officer, general manager, and any other key employee; and
(k) to agree powers or undertake to do any preferences of the foregoingPreferred Stock.
Appears in 1 contract
Sources: Stockholders Agreement (Cogent Communications Group Inc)
Protective Provisions. 10.1 Approval of Series A Preference Shares, Series B Preference Shares, Series D Preference Shares. 4.1 For so long as Bertelsmann, Sumitomo and BlueFocus respectively holds no less than 448,801 Shares, 437,629 Shares and 808,835 Shares (subject to adjustments made for share split, subdivision, consolidation, reorganization and the like events)any Series A Preferred Share remains outstanding, in addition to any other vote or consent required elsewhere in the Memorandum and Articles or by applicable Lawof Association, the Company shall not, not (and Members of the Company shall procure that the Company and each of its Subsidiaries shall not (directly or by amendment, merger, consolidation, amalgamation, scheme of arrangement or otherwisepermit any Group Company to) take any of the following actions (other than those in connection with a Non-Liquidation M&A) without the prior affirmative vote or written consent of the holders holding a number of at least 50% of the then outstanding Series D Preference Shares, the holders of at least 50% of the then outstanding Series B Preference A Preferred Shares and the holders of at least 50% representing more than two thirds (66.67%) of the then outstanding Series A Preference Shares, each Preferred Shares (voting separately as a single class.together on an as-converted basis):
(aA) to liquidateAmend, dissolve alter, waive or wind up repeal any provision in connection with any of the affairs rights, powers, privileges, preferences or restrictions for Series A Preferred Shares;
(B) Authorize, create or issue any new class or series of shares, or reclassify any outstanding shares of the Company, having rights, powers, privileges, preferences or effect any Liquidating Transactionrestrictions senior to or on a parity with Series A Preferred Shares;
(bC) to amendAmend, alter, waive or repeal any provision of the Memorandum and Articlesof Association, Articles of Association, or other constitutional or governance documents with prejudice to the rights, powers, privileges, preferences or restrictions for Series A Preferred Shares;
(cD) to create Issue, sell, mortgage, pledge, lease, transfer or authorize the creation otherwise dispose of or issue any other security convertible into or exercisable for any equity security, having rights, preferences interests or privileges senior to or on parity with the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, or increase the authorized number of shares of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares or do any act which has the effect of diluting or reducing the effective shareholding of the holders of the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares, provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with in the Memorandum and Articles after July 1, 2015;
(d) to create, or issue of any debenture or any obligation convertible into, any securities convertible into, any option to purchase or subscribe for, or warrants exercisable for, Shares of the Company (other than grant stock options to employees or consultant as ESOP pursuant to this Agreement);
(e) to purchase or redeem or pay any dividend on any capital stock prior to the Series A Preference Shares, the Series B Preference Shares or the Series D Preference Shares (other than stock repurchased from former employees or consultants in connection with the cessation of their employment/services, at the lower of fair market value or cost), provided that, no vote or written consent under this Section shall be required from the Holders of Series D Shares before the Company may enforce any paramount lien on, make a call on or forfeit any Shares held by BlueFocus representing the unpaid Residual Amount (if any) in accordance with the Memorandum and Articles after July 1, 2015;
(f) to create or authorize the creation of any debt security (other than equipment leases or bank lines of credit) unless such debt security has received the prior approval of the Board, including the approval of the Series A Director, the Series B Director and the Series D Director;
(g) to increase or decrease the size of the Board;
(h) to approve any change in the business scope or activities credit rights of the Company;
(iE) to take actions subject to other protective provisions to be set forth in Repurchase or redemption of any securities of the definitive agreements in connection with the Series A financing, the Series B financing or the Series D financingCompany;
(jF) to approve and change any compensation package Sell, mortgage, pledge, lease, transfer or otherwise dispose of substantially all of the assets of the Company or any Group Company;
(G) Engage in any recapitalization, reorganization, split-off, spin-off, or filing for bankruptcy, or any voluntary dissolution, winding-up, or liquidation of the Company or any Group Company;
(H) Declare or pay a distribution or dividend with respect to the Common Shares (referring to distributions or dividends with respect to the Common Shares declared solely payable or paid solely to holders of Common Shares);
(I) Incur any indebtedness for borrowed money, or issue, assume, guarantee or create any liability for borrowed money, the collective, aggregate outstanding amount of which at any given time for the Company and any Group Company is US$100,000 or more;
(J) Make any loans or guarantees by the Company or any Group Company to or for the benefit of any director, member of senior management or any employee of the Company or any Group Company;
(K) Purchase or lease any automobile vehicles valued in excess of US$25,000 by the Company or any Group Company;
(L) Purchase by the Company or any Group Company any securities in any other Person in excess of US$20,000 in aggregate over any twelve-month period;
(M) Increase the compensation in excess of 15% of any of the five employees that receive the highest payment in the Company or any Group Company over any twelve-month period;
(N) Except as specifically contemplated in the Share Purchase Agreement and the ancillary documents thereto, the entry into any transaction or series of transactions between (or the termination, extension, continuation after expiry, renewal, amendment, variation or waiver of any term under agreement with respect to any transaction or series of transactions) (i) which is between, the Company or any Group Company, on the one hand, and the holder of any equity interest in the Company or any Group Company (other than with respect to any equity interest held therein by the Company or another Group Company), or any director, officer or employee of the Company or any Group Company, or any director, officer or employee of the Company’s Affiliates, including but on the other hand, and (ii) which is not limited in the ordinary course of business or for which the aggregate value exceeds the equivalent of US$25,000.
(O) Cause or make material alteration to the chief executive officer, general manager, business plan or annual budget plan of the Company or any Group Company;
(P) Appoint the directors of any Group Company;
(Q) Contract with or rescind contract with any distributor that represents 5% or more of the sales volume of the Company and the Group Companies;
(R) Approve annual business plan or annual budget plan and stock option incentive plan of the Company;
(S) Form any other key employeejoint venture or wholly-owned subsidiary by the Company or any Group Company; and
(kT) to agree Hire, fire, reappoint or undertake to do determine or change the compensation by 30% or more within one (1) year of any of the foregoingChief Executive Officer, Chief Operating Officer, Chief Technology Officer, Chief Financial Officer, or other member of senior management, as considered important by the Board, of the Company or any Group Company. provided, however, that where any resolution of the Company is required to approve any of the matters listed above and such matters have not received the approval of the holders of Series A Preferred Shares required by these Articles, the number of votes of the holders of Series A Preferred Shares shall be equal to the number of votes of the other Members who voted for the resolution plus one.
4.2 For so long as any Series A Preferred Share remains outstanding, in addition to any other vote or consent required elsewhere in the Memorandum and Articles of Association, the Company shall ensure that the directors appointed by the Company to any Group Company that is wholly-owned by the Company (a “Wholly-Owned Group Company”) would not take any of the following actions without the affirmative vote of holders holding a number of Series A Preferred Shares representing more than two thirds (66.67%) of the then outstanding Series A Preferred Shares (voting together on an as-converted basis) of the Company:
(i) Cause or make any alteration or amendment to the Articles of Association or other constitutional documents of any Wholly-Owned Group Company;
(ii) Liquidate, terminate or dissolve any Wholly-Owned Group Company;
(iii) Increase the registered capital, or transfer the profits, of any Wholly-Owned Group Company;
(iv) Sell all or substantially all of the assets of any Wholly-Owned Group Company, or merge or consolidate any Wholly-Owned Group Company with other Person;
(v) Change the business scope of any Wholly-Owned Group Company; and
(vi) Appoint the general manager of any Wholly-Owned Group Company.
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