Standstill. During the Cooperation Period, each Live Party will not, and will cause its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to not, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board: (i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement; (ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders; (iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates; (iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents; (v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company; (vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement; (vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them; (viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board; (ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company; (x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties; (xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process; (xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement; (xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c); (xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement; (xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company; (xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC; (xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 2 contracts
Sources: Cooperation Agreement (LIVE VENTURES Inc), Cooperation Agreement (LL Flooring Holdings, Inc.)
Standstill. During For so long as the Cooperation PeriodStockholders or any of their successors or assigns hold the shares of the Common Stock, each Live Party will the Parent Stockholder and its wholly owned or controlled subsidiaries shall not, and will cause its Affiliates and its Representatives acting on behalf without the prior written consent of the Live Parties Company:
(collectively with a) acquire, offer, seek or propose to acquire, or agree to acquire, directly or indirectly (including acquiring beneficial ownership as defined in Rule 13d-3 under the Live PartiesExchange Act), by purchase or otherwise, any capital stock of the Company or direct or indirect rights to acquire any capital stock of the Company, or any assets of the Company or any subsidiary or division of the Company or of any such successor or controlling person, if such acquisition would cause the Stockholders’ ownership interest in the Common Stock to exceed, (i) prior to and including the date that is six months following (x) the closing of the Tender Offer or (y) if the Stockholders withdraw or decline to close the Tender Offer, the withdrawal or expiration of the Tender Offer (such date being, the “Restricted PersonsSix Month Anniversary Date”), 19.9% of the Company’s outstanding Common Stock as measured immediately after the Company’s issuance of the Consideration Shares and the Top-up Shares (each as defined in the Purchase Agreement); provided that in no event shall the sum of the Consideration Shares and the Top-up Shares exceed 19.9% of the Company’s outstanding Common Stock as measured immediately prior to the commencement of the Tender Offer, and (ii) to notafter the Six Month Anniversary Date, twenty percent (20.0%) of the Company’s outstanding Common Stock as measured as of the date of any such acquisition;
(b) make, or in any way participate, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) make any public announcement, proposal or offer (including in any “solicitation” of “proxies” to vote (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SECCommission), but including, notwithstanding anything or seek to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten advise or influence any person or entity (10other than Parent Stockholder and its subsidiaries) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal voting of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent capital stock of the Company;
(vic) knowingly encourage or advise make any Third Party or knowingly assist any Third Party in encouraging or advising any other Person public announcement with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, submit a proposal for or offer of (Bwith or without conditions) conducting any type of referendum relating (including to the Company (including, for the avoidance Board of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any Directors of the Company’s securities and would), in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or extraordinary transaction involving the Company or any of its subsidiariessecurities or assets, its current except as provided herein;
(d) form or former directors or its officers (including derivative actions), each in their capacity as such join a 13D Group (other than to enforce rights under this Agreement); provided, however, that for any such group consisting solely of Parent Stockholder and its subsidiaries) in connection with any of the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal processforegoing;
(xiie) knowingly instigate, cooperate with otherwise act or assist (including by providing seek to control the management or arranging financing Board or other services for) any Third Party to do any policies of the actions set forth Company, whether alone or in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreementconcert with others;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xivf) take any action that would could reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding the possibility of any of the actions set forth events described in this Section 3(cclauses (a) or through (iie) have the purpose or effect of circumventing any provision of this Agreementabove;
(xvg) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of request the Company or nominee for director any of the Company;
(xvi) except as required by applicable lawits representatives, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request directly or submit any proposal indirectly, to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, require public disclosure; or
(h) direct or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance instruct any of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties subsidiaries, representatives or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or affiliates to take any transactions involving the Companysuch action.
Appears in 2 contracts
Sources: Stockholders Rights Agreement, Stockholders Rights Agreement (WPP PLC)
Standstill. During (a) From the Cooperation Perioddate hereof until the fourth anniversary of the Closing Date, each Live Party the Schlumberger Parties and their Affiliates (and anyone acting on behalf of any such Persons) will not, and will cause its Affiliates and its Representatives acting on behalf of the Live Parties not enter into any agreement, understanding or other binding arrangement to:
(collectively with the Live Parties, the “Restricted Persons”i) to notacquire, directly or indirectly, without the prior written consent, invitation, or authorization Beneficial Ownership of any equity securities of the Company other than in connection with a share split, share dividend or the Board:similar transaction;
(iii) publicly seek, make or take any public announcementaction to solicit or encourage any offer or proposal for any merger, proposal consolidation, tender or offer exchange offer, sale or purchase of assets or securities or other business combination, restructuring, recapitalization or similar transaction involving the Company;
(including iii) “solicit” or become a “participant” in any “solicitation” of any “proxiesproxy” (as such terms are defined or used in Regulation 14A under the Securities Exchange Act of 1934 (as amended, the “Exchange Act”)), written consents with respect to, ) from or otherwise solicit, seek, cause, offer or offer to effect, (A) by any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company in connection with any vote on any matter (whether or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect not relating to the election or removal of one directors), or more directors of the Company agree or announce its intention to vote with any other matter Person or proposal relating to the Company or become group undertaking a “participantsolicitation”;
(iv) form, join or in any way participate in a “group” (as such term is defined in Instruction 3 to Item 4 under Section 13(d) of Schedule 14A under the Exchange ActAct or the rules promulgated thereunder) in any such solicitation of proxies or consents;
(v) disclose with respect to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent equity securities of the Company;
(viv) knowingly encourage or advise grant any Third Party or knowingly assist proxies to any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group third party with respect to any Voting Securities, equity securities of the Company (other than solely with Affiliates as recommended by the Board) or deposit any equity securities of the Live Parties with respect to Voting Securities now or hereafter owned by them;Company in a voting trust; or
(viiivi) enter into any voting trustrequest, arrangement propose or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like)otherwise seek, in each case other than (A) this Agreementin a manner that would require public disclosure, (B) solely between any amendment or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation waiver of the Board;provisions contained in clauses (i)-(v) of this Section 3.1(a).
(ixb) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the The restrictions set forth in Section 3 3.1(a) shall automatically terminate not apply at any time during which the Schlumberger Parties and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more their Affiliates collectively Beneficially Own less than 2510% of the outstanding Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 2 contracts
Sources: Stockholders Agreement (Liberty Oilfield Services Inc.), Master Transaction Agreement (Liberty Oilfield Services Inc.)
Standstill. During (a) Subject to Section 5.7, from the Cooperation date of this Agreement until the second (2nd) anniversary of the Closing Date (the “Standstill Period”), the Trustee shall ensure that each Live Party will Trust and the Representatives of the Trustee who are directors, officers or employees of the Trustee do not, and will use its reasonable best efforts to cause its Affiliates and its other Representatives that are acting on its behalf in connection the Reclassification, alternatives thereto, the Company or the interests of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) Trusts therein to not, directly or indirectly, without except with the prior written consent, invitation, invitation or authorization consent of the Company or the Board:
(i) make other than the Existing Shares, acquire or beneficially own any public announcementshares of Class A Stock, proposal Class B Stock or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A other equity securities of the Exchange Act))Company (including, written consents from and after the Closing, any shares of Common Stock) or any options, warrants, swaps, forward contracts or other derivative instruments with respect tothereto (each, or otherwise solicit“Company Securities”); provided, seekthat the Trustee, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies behalf of the CompanyTrusts, including any change in shall not be prohibited from entering into customary “short position” derivative transactions with respect to Company Securities for the number purpose of directors serving hedging the economic exposure to the Trusts of owning the Existing Shares, as long as the Trustee, on behalf of the Board or Trusts, retains the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary ability at all times to (or may require vote the Company Securities subject to waive) any of the terms of this Agreementsuch arrangements;
(ii) seekmake, alone or in concert with one any way participate in, directly or more Third Partiesindirectly, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary defined in Rule 14a-2 14a-1 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would including any otherwise be excluded from the definition of “solicitation” exempt solicitation pursuant to Rule 14a-2(b)(214a-2(b) under the Exchange Act) of one to vote or more proxies refrain from voting any Company Securities;
(iii) make any director nomination or consents shareholder proposal with respect to the election Company;
(iv) act, whether alone or removal with others, to propose or seek to propose any merger, share exchange, business combination, tender or exchange offer, restructuring, recapitalization, liquidation or similar transaction of one or more directors involving, or any sale or other disposition or acquisition of any part of the Company or any other matter or proposal relating to consolidated assets of, the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consentsCompany;
(v) disclose solicit, initiate, knowingly encourage or knowingly facilitate, or negotiate with any person(s) with respect to any Third Partymerger, either publicly share exchange, business combination, tender or in a manner that would reasonably be expected to result in exchange offer, restructuring, recapitalization, liquidation or require public disclosuresimilar transaction of or involving, its voting or consent intentions or any vote as to sale or other disposition or acquisition of any matter submitted to a stockholder vote during part of the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision)consolidated assets of, except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage deposit any Company Securities in a voting trust or advise similar arrangement or enter into or subject any Third Party Company Securities to any voting agreement or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreementsimilar arrangement;
(vii) formact as a financing source for, joinor facilitate any financing by, knowingly encourage or knowingly participate any other person(s) in or knowingly act in concert connection with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by themforegoing;
(viii) enter into take any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), action in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value pursuit of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates types of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions matters set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with5.6 which would, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) to, require any Live Party or the Company to make a public announcement regarding any of the actions types of matters set forth in this Section 3(c) 5.6 or (ii) have the purpose or effect of circumventing any provision of this Agreementin response thereto;
(xvix) disclose any intention, plan or arrangement, or enter into any negotiations, arrangements or maintain understandings with any economicperson(s), compensatory which are inconsistent with any of the foregoing;
(x) form or pecuniary agreement, arrangement or understanding join a group (written or oralwithin the meaning of Section 13(d)(3) of the Exchange Act) with any director person(s) in connection with the taking of the Company any action set forth in this Section 5.6, or nominee for director of the Company;act together with or knowingly encourage any person or group in taking any such actions; or
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xviixi) make any request to the Company or submit any proposal its Representatives, directly or indirectly, to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal5.6. For the avoidance of doubt, nothing in subject to Section 5.4, this Agreement Section 5.6(a) shall prevent or not limit the Live Parties ability of the Trustee or their respective Affiliates the Trusts to vote for or against, grant proxies, written consents or ballots in relation to, tender into or abstain from taking any action in connection with transactions, proposals or other matters initiated and Representatives from working coordinated by other persons unaffiliated with the Live Parties Trustee and the Trusts and acting independently of, and not in conjunction with or at the Live Parties’ other Representatives behest or instigation of, the Trustee and the Trusts.
(b) The Trustee, on behalf of each Trust, hereby irrevocably and unconditionally agrees, during the Standstill Period, at each annual or special meeting of the Shareholders, however called, including any adjournment or postponement thereof, and in connection with any action proposed to be taken by written consent of the Shareholders, that the Trustee, on behalf of each Trust, shall, in each case to the fullest extent that the Covered Shares are entitled to vote thereon or consent thereto, appear, in person or by proxy, at each such meeting or otherwise cause the Covered Shares to be counted as present thereat for the purpose purposes of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companydetermining a quorum.
Appears in 2 contracts
Sources: Reclassification Agreement (BESSEMER TRUST Co NATIONAL ASSOCIATION), Reclassification Agreement (Hubbell Inc)
Standstill. During (a) From and after the Cooperation Perioddate hereof, each Live Party the Investor will not, and will cause each Investor Affiliate not to, directly or indirectly, acquire Beneficial Ownership of shares of Issuer Common Stock, including for purposes of this Section 1.1(a), rights, options or other derivative securities or contracts or instruments to acquire such ownership that derive their value (in whole or in part) from such Issuer Common Stock, if, after giving effect to such acquisition, the Investor’s Investor Percentage Interest would exceed the Cap; provided, however, that such restriction on acquisitions will not be applicable with respect to the acquisition by the Investor Affiliates of Beneficial Ownership of Issuer Common Stock (i) pursuant to the Purchase Agreement (unless, for the avoidance of doubt, the representation of the Investor in Section 4.2(d) hereof is not true and correct), (ii) as a result of any stock splits, stock dividends or other distributions or recapitalizations or similar offerings made generally available by the Issuer or any Subsidiary thereof to holders of Issuer Common Stock (or other equity securities of the Issuer), including rights offerings and distributions made generally to holders of Issuer Common Stock (or other equity securities of the Issuer) as a result of their ownership of Issuer Common Stock (or other equity securities of the Issuer) including pursuant to a shareholder rights plan or similar plan or agreement, (iii) as a result of the exercise (or exchange) of any rights distributed by the Issuer pursuant to clause (ii) above, (iv) in accordance with a Permitted Offer or (v) which has been approved by a majority of the Non-Investor Directors.
(b) Notwithstanding the provisions of Section 1.1(a), at any time following the earlier of (x) ten (10) days following the date any Third Party commences (within the meaning of Section 14(d) of the Exchange Act) a tender or exchange offer which, if consummated, would result in such Person becoming the Beneficial Owner of Issuer Common Stock (or other equity securities) having Majority Voting Power (such offer, a “Third Party Offer”), unless during such ten (10) day period, the Issuer Board takes such actions as are reasonably necessary to prevent, delay, or restrict the purchase of Issuer Common Stock (or other equity securities) pursuant to such Third Party Offer, including implementation of a shareholder rights plan and other customary defensive actions, (y) the date Issuer publicly recommends a Third Party Offer or takes any action inconsistent with actions previously taken pursuant to clause (x) (including granting an exception in respect of such Third Party Offer under any shareholder rights plan or granting approval of such offeror for purposes of DGCL Section 203), and (z) at any time following December 31, 2016, so long as, in the case of an action pursuant to this clause (z), Investor has, subsequent to such date, negotiated in good faith with the Issuer Board for a period of at least thirty (30) days as to the terms of such proposed offer, then in each case, the Investor Affiliates will be entitled to commence and accept for purchase and purchase shares of Issuer Common Stock pursuant to a tender or exchange offer so long as such tender or exchange offer (such tender or exchange offer meeting the requirements set forth in this Section 1.1(b), a “Permitted Offer”):
(i) is commenced and made in accordance with the applicable rules and regulations under the Exchange Act applicable to tender or exchange offers, including, if applicable, Section 13(e)-3 of the Exchange Act and the related rules and regulations applicable thereto;
(ii) is made to all holders of Issuer Common Stock;
(iii) will expire no earlier than midnight, New York City time, on the twentieth (20th) business day following the commencement thereof (as determined using Rule 14d-1(g)(3) under the Exchange Act);
(iv) is subject to customary conditions to the obligation of the Investor Affiliates to purchase Issuer Common Stock; provided, that, (A) in the event a Permitted Offer is made pursuant to clause (z) of Section 1.1(b) and no Third Party Offer is commenced or made during the period such Permitted Offer is outstanding, it will be a condition to closing of such Permitted Offer that the number of shares of Issuer Common Stock tendered and not withdrawn, when purchased by the Investor Affiliates, constitute no less than a majority of the outstanding shares of Issuer Common Stock outstanding at the time of commencement that are not Beneficially Owned by the Investor Affiliates as of the date such Permitted Offer is commenced, disregarding for purposes of calculating the number of outstanding shares of Issuer Common Stock any such shares issued pursuant to Section 1.5(e) (such condition, the “Minimum Condition”) and (B) any conditions to the consummation of such offer may be waived by the Investor in its sole discretion, other than, in the event no Third Party Offer is outstanding or is made, in each case, during the pendency of such Permitted Offer, the Minimum Condition; and
(v) provides for consideration payable in cash, common stock or other securities of the Investor or a Subsidiary thereof, or a combination thereof; provided, that, such consideration offered has, on a per share of Issuer Common Stock basis, a fair market value (as determined in good faith by the Investor’s board of directors) equal to or greater than the closing price of the Issuer Common Stock on Nasdaq on the Trading Day immediately prior to the earlier of (x) the public announcement of such Permitted Offer and (y) commencement of such Permitted Offer.
(c) In the event the Investor Affiliates make a Permitted Offer, the Issuer will furnish the Investor Affiliates with all information concerning the Issuer required by the Exchange Act to be included in the applicable offering document for such Permitted Offer.
(d) Except as provided in or permitted by Sections 1.1(b), (e), (f), (g) and (h) unless specifically approved in writing by Issuer, the Investor will not, and will cause each Investor Affiliate and its and their respective Representatives acting on behalf of the Live Parties Investor or any Investor Affiliate not to, in any manner, directly or indirectly:
(collectively with the Live Partiesi) enter into or agree, the “Restricted Persons”effect or seek, offer or propose (whether publicly or otherwise) to noteffect, or announce any intention to effect or cause or participate in or in any way assist, facilitate or encourage any other Person to effect or seek, offer or propose (whether publicly or otherwise) to effect or participate in: (A) except to the extent otherwise specifically permitted by this Agreement, any acquisition of any Issuer Common Stock (or Beneficial Ownership thereof) or any material portion of the assets of Issuer and its Subsidiaries (taken together); (B) any tender or exchange offer, merger or other business combination involving Issuer or any of its Subsidiaries (provided, that, this clause does not restrict any Investor Affiliate from (x) opposing publicly or privately any tender or exchange offer, merger or other business combination involving the Issuer or any Subsidiary thereof or (y) Transferring any shares of Issuer Common Stock pursuant to such tender or exchange offer, merger or other business combination); or (C) any recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to Issuer or any of its Subsidiaries;
(ii) except as provided in Article 3, make or participate in, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in under Regulation 14A of under the Exchange Act)) to vote, or seek to advise or influence any Person or entity with respect to the voting of, any Issuer Common Stock or any demand for a copy of Issuer’s stock ledger, list of stockholders or any other books and records of Issuer (other than with respect to matters related to the Investor’s exercise or enforcement of rights under the Purchase Agreement), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, except that this subsection does not restrict (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies Investor Directors from participating as members of the Company, including Issuer Board and any change committees thereof in the number of directors serving on the Board or the filling of any vacancy on the Board their capacity as such or (B) the Investor Affiliates from opposing publicly or privately, or voting against or encouraging others to vote against, (x) any public proposal of a third party regarding a merger or other statement that is directly contrary to business combination involving the Issuer or any Subsidiary thereof or (or may require the Company to waivey) any other similar corporate transaction on which a vote of the terms of this AgreementIssuer’s stockholders is required under Delaware Law or Nasdaq rules;
(iiiii) seekcall or seek to call a meeting of Issuer’s stockholders or initiate any stockholder proposal for action by Issuer’s stockholders, alone form, join or in any way participate in a 13D Group or otherwise act in concert with one or more Third Partiesany Person, election or appointment toin each case, with respect to the Issuer Common Stock, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, propose or otherwise act alone or in concert with others, to influence or control Issuer’s management, the removal of any member Issuer Board or policies, except that this subsection does not restrict (x) the Investor Directors from participating as members of the Issuer Board and any committees thereof in their capacity as such and (y) the Investor from joining or initiate, encourage or participate in any “withhold” way participating in a 13D Group or similar campaign otherwise acting in concert with respect any Person, in each case, to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of exercise its subsidiaries rights under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates1.1(d)(ii)(B);
(iv) engage in take any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) action which would or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company force Issuer to make a public announcement regarding any of the actions types of matters set forth in clause (i) above;
(v) bring any action, or otherwise act, to contest the validity of this Section 3(c1.1(d); or
(vi) enter into any discussions or arrangements with any third party with respect to any of the foregoing (except as otherwise expressly provided herein).
(e) Unless earlier terminated or made inapplicable pursuant to Section 1.1(f), the provisions of Section 1.1(d) (other than the provisions of Section 1.1(d)(i)) will terminate upon the expiration of the Restricted Period. For the avoidance of doubt, any tolling of such restrictions pursuant to Section 1.1(f) will not result in any extension of the period referred to in the previous sentence.
(f) The restrictions set forth in Section 1.1(d) (other than the provisions of Section 1.1(d)(i)) shall not apply (and the Investor will be permitted to take the actions otherwise prohibited thereunder) if any of the following occurs (provided, that, in the event any matter described in clauses (i) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xvSection 1.1(f) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), has occurred and resulted in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this imposed under Section 3(c1.1(d) shall terminate automatically (other than the provisions of Section 1.1(d)(i)) ceasing to apply to the Investor, then, in the event of a material breach of this Agreement by the Company if transaction related to such material breach matter has not been cured occurred within five six (56) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end months of the notice period); provided, further, that in date on which the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”)Investor was released from such restrictions, then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did transaction is not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke being actively pursued at such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrarytime, the restrictions set forth in Section 3 1.1(d) shall automatically terminate thereafter resume and be of no further force and effect if continue to apply in accordance with their terms, until terminated pursuant to Section 1.1(e) or subsequently made inapplicable pursuant to this Section 1.1(f)):
(i) in the Company event that a tender offer or exchange offer for at least thirty-five percent (35%) of the Issuer Common Stock is commenced (within the meaning of Section 14(d) of the Exchange Act) by a third Person which, for the avoidance of doubt, is not an Investor Affiliate (and not involving any breach of Section 1.1(d)) which tender offer or exchange offer, if consummated, would result in such third party (or any 13D Group of which such third party is a member) becoming the Beneficial Owner of securities representing greater than either thirty-five percent (35%) of the outstanding shares of Issuer Common Stock or thirty-five percent (35%) of the voting power of the Issuer, and either (1) the Issuer Board recommends that the stockholders of the Issuer tender their shares in response to such offer or does not recommend against the tender offer or exchange offer within ten (10) days after the commencement thereof or such longer period as shall then be permitted under U.S. federal securities laws or (2) the Issuer Board later publicly recommends that the stockholders of the Issuer tender their shares in response to such offer;
(ii) the Issuer solicits from one or more Persons, or enters into substantive discussions with one or more Persons regarding, a definitive agreement proposal with respect to a transaction involving Change of Control Transaction, or the Issuer makes a public announcement that it is seeking to sell itself and, in such event, such announcement is made with the approval of the Issuer Board;
(iii) subject to the obligations of the Investor under Section 3.2, in the event that the Persons designated by the Investor to be elected or appointed to the Issuer Board as Investor Directors pursuant to Article 3 hereof are either (x) not appointed to the sale Issuer Board as contemplated herein or transfer nominated for inclusion on management’s slate of all nominees for election to the Issuer Board at any Election Meeting or a controlling portion (y) if so nominated are not so elected to the Issuer Board, or the Issuer otherwise breaches its obligations under Article 3;
(iv) the Investor Percentage Interest is less than ten percent (10%);
(v) the Investor Percentage Interest is greater than fifty percent (50%);
(vi) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (x) liquidation, reorganization or other relief in respect of the Company’s equity securities Issuer or all any material Subsidiary or its debts, or of a substantially all substantial part of the Company’s assets (whether by mergerits assets, consolidationunder any federal, business combinationstate or foreign bankruptcy, tender insolvency, receivership or exchange offer, recapitalization, restructuring, sale, equity issuance similar Law now or otherwise) hereafter in effect or (y) the issuance appointment of securities representing a receiver, trustee, custodian, sequestrator, conservator or convertible into similar official for the Issuer or exchangeable any material Subsidiary or exercisable forfor a substantial part of its assets, directly and, in any such case, such proceeding or indirectly, more than 25% petition shall continue undismissed for sixty (60) days or an order or decree approving or ordering any of the Common Stockforegoing shall be entered; or
(vii) the Issuer or any material Subsidiary shall (A) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any federal, state or foreign bankruptcy, insolvency, receivership or similar Law now or hereafter in effect, (B) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (A) above, (C) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Issuer or any material Subsidiary or for a substantial part of its assets, (D) file an answer admitting the material allegations of a petition filed against it in any such proceeding, or (E) make a general assignment for the benefit of creditors.
(g) So long as the Investor Percentage Interest is equal to or greater than fifteen percent (15%), the Issuer agrees not to enter into any agreement regarding a (i) merger, (ii) consolidation, (iii) Change of Control Transaction, or (iv) other business combination transaction unless, in each case, at least ten (10) days prior to the execution of such agreement, the Issuer has given Investor written notice of its intention to enter into such agreement.
(h) Notwithstanding the provisions of Section 1.1(d), and so long as the Investor Percentage Interest is equal to or greater than fifteen percent (15%), in the case of each of clause event (i) the Issuer solicits from one or more Persons or enters into substantive discussions with one or more Persons regarding a proposal with respect to (x) and a Change of Control Transaction or (y), with any Person other than ) a Live Party or an Affiliate sale of a material portion of the Live Parties Issuer’s assets outside the ordinary course of business or (ii) the Company adopts Issuer provides any plan of complete or partial liquidationnotice to Investor pursuant to Section 1.1(g), dissolutionin each case, restructuringInvestor will be entitled to engage in private discussions with, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public and make private proposals to, or otherwise communicating with, (i) the Issuer Board or any director management of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), Issuer with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly proposed transaction or a competing proposal by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the CompanyInvestor.
Appears in 2 contracts
Sources: Investor Rights Agreement (FTD Companies, Inc.), Investor Rights Agreement (FTD Companies, Inc.)
Standstill. During Other than pursuant to the Cooperation Periodpreemptive rights set forth in Article III, each Live Party will notas contemplated by the Purchase Agreement, any exercise of the Warrant or actions taken by the Series A Director in his/her capacity as a member of the Board in light of such director’s fiduciary duties, until the earlier of (a) the 3rd anniversary of the date hereof, (b) the expiration of the right of Series A Requisite Investors to elect the Series A Director, and will cause its (c) the date on which the Investors and their Affiliates and its Representatives acting on behalf beneficially own less than 5% of the Live Parties (collectively with the Live Partiesshares of Common Stock then issued and outstanding, the Investors shall not (provided, that the foregoing limitation shall only apply to the “Restricted Persons”Power Opportunities” and “Opportunities” strategies of the Investors, and not to any other strategies of the Investors, the Investors’ Affiliates or any of its or their other investments or portfolio companies), except as expressly approved or invited in writing by the Company: (i) to not, directly or indirectly, without acquire beneficial ownership of Common Stock or Common Stock Equivalents or any instrument that gives the prior written consentInvestor or any of its Affiliates the economic equivalent of ownership of Common Stock (a “Derivative”); (ii) make a tender, invitationexchange or other offer to acquire Common Stock or Common Stock Equivalents; (iii) directly or indirectly, or authorization (1) seek to have called any meeting of the stockholders of the Company or propose any matter to be voted upon by the Board:
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies stockholders of the Company, including any change in the number of directors serving on or (2) propose or nominate for election to the Board or the filling of Directors any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the person whose nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member has not been approved by a majority of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
Directors (iii) make any request for stockholder list materials or other books and records of excluding the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
Series A Director); (iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) directly or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, joinindirectly, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securitiessupport a tender, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, exchange or other similar right offer or proposal by any other Person or group (including any put an “Offeror”) for Common Stock (if such offer or call option or “swap” transaction) with respect to any security (other than any index fundproposal would, exchange-traded fundif consummated, benchmark fund or broad basket result in a Change of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any Control of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, such offer or agree proposal is referred to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreementan “Acquisition Proposal”); provided, however, that for from and after the avoidance filing of doubta Schedule 14D-9 (or successor form of Tender Offer Solicitation/Recommendation Statement under Rule 14d-9 of the Exchange Act) by the Company recommending that stockholders accept any such offer filed after such offer has commenced, the foregoing Investor shall not prevent any Live Party be prohibited from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do taking any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement otherwise prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee 5.1 for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as the Board of Directors maintains and does not withdraw such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request)recommendation; provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contractv) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, knowingly solicit proxies or consents or become a participant in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, a solicitation (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by terms are defined in Regulation 14A under the Company or Exchange Act); (vi) publicly propose (1) any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, purchase of the Company’s assets or businesses or any similar transaction involving the Company or (2) any recapitalization, restructuring, saleliquidation or other extraordinary transaction with respect to the Company, equity issuance or otherwise) or (y) in each case without the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% prior written consent of the Common Stock, Board (a transaction described in the case of each of clause clauses (x1) and (y2) that would result in a Change of Control, is referred to as a “Business Combination”), ; (vii) knowingly act in concert with any Person other than a Live Third Party or an Affiliate of the Live Parties or (ii) the Company adopts to take any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition action in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, clauses (i) the Board through (vi) above; (viii) make any public announcement regarding, or take any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner action that would require, or reasonably be expected to require, the Live Parties or require the Company to make a public announcement regarding such proposal. For regarding, a potential Business Combination or any of the avoidance of doubtmatters set forth in clauses (i) through (vii) above; or (ix) enter into any arrangements or agreements with any Person relating to the foregoing actions referred to in (i) through (vii) above; provided, however, that nothing contained in this Agreement Section 5.1 shall prevent or limit prohibit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction Investor or any transactions involving of their Affiliates from making confidential, non-public proposals to the CompanyBoard of Directors.
Appears in 2 contracts
Sources: Investor Rights Agreement (Tpi Composites, Inc), Investor Rights Agreement (Tpi Composites, Inc)
Standstill. During (a) Each Investor agrees that, from the Cooperation date of this Agreement until the expiration of the Standstill Period, each Live Party will notneither it nor any of its Affiliates or Associates will, and it will cause each of its Affiliates Affiliates, Associates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notrepresentatives not to, directly or indirectly, without the prior written consentin any manner, invitation, acting alone or authorization of the Company or the Boardin concert with others:
(i) make submit any public announcementstockholder proposal (pursuant to Rule 14a-8 promulgated by the Securities and Exchange Commission (the “SEC”) under the Securities Exchange Act of 1934, proposal as amended (the “Exchange Act”) or offer otherwise) or any notice of nomination or other business for consideration, or nominate any candidate for election to the Board (including any “solicitation” by way of “proxies” (as such terms are defined or used in Rule 14a-11 of Regulation 14A of the Exchange Act)14A), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of than as expressly permitted by this Agreement;
(ii) seekengage in, alone directly or in concert with one or more Third Partiesindirectly, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary defined in Rule 14a-2 under the Exchange Act, solicitations 14a-1 of ten Regulation 14A) of proxies (10or written consents) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participantparticipant in a solicitation” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A of Regulation 14A under the Exchange Act) in opposition to the recommendation or proposal of the Board, or recommend or request or induce or attempt to induce any other person to take any such solicitation actions, or seek to advise, encourage or influence any other person with respect to the voting of the Common Stock or grant a proxy with respect to the voting of the Common Stock or other voting securities to any person other than to the Board or persons appointed as proxies or consentsby the Board; provided, however, that except as set forth in Section 2 and this Section 3, nothing herein shall be interpreted to restrict the Investors’ ability to vote their shares on any proposal duly brought before the Company’s shareholders as each member of the Investors determines in its sole discretion;
(viii) disclose seek to call, or to request the call of, a special meeting of the Company’s stockholders, or make a request for a list of the Company’s stockholders or for any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent books and records of the Company;
(viiv) knowingly encourage take any action (including making any proposal to act) by written consent;
(v) form, join in or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating toway participate in a “partnership, limited partnership, syndicate or other authority to vote, any Voting Securities, or (Bgroup” within the meaning of Section 13(d)(3) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, Exchange Act with respect to the Company’s management Common Stock or the Board)deposit any shares of Common Stock in a voting trust or similar arrangement or subject any shares of Common Stock to any voting agreement or pooling arrangement, other than to the extent such encouragement or advice that is consistent a group may be deemed to result with the Company or any of its Affiliates or Associates as a result of this Agreement or the participation of the Investors in the Committee (but only so long as the Investors are the only members of said group);
(vi) vote for any nominee or nominees for election to the Board’s recommendation in connection with such matter, other than those nominated or as otherwise expressly permitted supported by this Agreementthe Board;
(vii) form, join, knowingly encourage or knowingly participate except as specifically provided in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates Section 1 and Section 2 of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between seek to place a representative or among the Live Parties and their Affiliatesother Affiliate, Associate or (C) granting any proxy in any solicitation approved by nominee on the Board and consistent with or seek the recommendation removal of any member of the Board or a change in the size or composition of the Board;
(ixviii) engage in any short sale acquire or any purchaseagree, saleoffer, seek or propose to acquire, or grant of any optioncause to be acquired, warrant, convertible security, share appreciation right, or other similar right ownership (including any put or call option or “swap” transactionbeneficial ownership) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate assets or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates business of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current rights or former directors options to acquire any such assets or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent business from any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal processperson;
(xiiix) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions except as set forth in this Section 3(c3(x) or that have below, other than at the purpose or effect direction of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) withBoard seek, or advisepropose, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c)with respect to, or make any investment in or enter into any agreement with any other person that engagessolicit, negotiate with, or offers or proposes provide any information to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), person with respect to an Extraordinary Transaction between the Live Parties and the Companyto, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, acquisition of control or other business combination, tender or exchange offer, purchase, sale or transfer of assets or securities, dissolution, liquidation, reorganization, change in structure or composition of the Board, change in the executive officers of the Company, change in capital structure, recapitalization, restructuringdividend, saleshare repurchase or similar transaction involving the Company, equity issuance its subsidiaries or otherwise) its business, whether or (y) the issuance not any such transaction involves a change of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% control of the Common Stock, in the case of each of clause Company.
(x) solely with respect to an Opposition Matter, the Investors shall have the right to solicit in opposition, and (y)otherwise campaign publicly or privately against, any Opposition Matter and shall be free to engage in communications with any Person other than a Live Party or shareholders and third parties in connection with an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, Opposition Matter and nothing in this Agreement shall prohibit be interpreted to restrict their ability to do so. As used herein, the Live Parties or their Representatives from making non-public proposals toterm “Opposition Matter” shall mean any of the following transactions, or otherwise communicating withbut only to the extent required by the Delaware General Corporation Law (or, exclusively in the case of the issuance of more than twenty (i20%) the Board or any director of the Company’s then outstanding shares of Common Stock, the rules of the Nasdaq Stock Market), to be submitted by the Board to the Company’s stockholders for approval: the sale or transfer of all or substantially all of the Company’s assets in one or a series of transactions, the sale or transfer of a majority of the outstanding shares of the Company’s common stock (ii) through a merger, stock purchase or otherwise), any financial advisormerger, legal counsel consolidation, acquisition of control or other advisor to business combination, tender or exchange offer, dissolution, liquidation, reorganization, or change in capital structure (including issuance in the Company or aggregate of more than twenty (20%) percent of the Company’s then outstanding shares of Common Stock), in each case that has been approved by the Board but voted against by (A) the ▇▇▇▇▇ Street Director (in which case only ▇▇▇▇▇ Street shall have such rights) or (iiiB) solely to the extent directed or permitted by the Board, any officer of the Company Additional Director (who is not also a directorin which case only Stone House shall have such rights), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 2 contracts
Sources: Cooperation Agreement (Baker Street Capital Management, LLC), Cooperation Agreement (Usa Truck Inc)
Standstill. During Until the Cooperation PeriodTermination Date (subject to the Company having complied with the first sentence of Section 1), each Live Party the Circumference Group will not, and will cause each of its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) Associates to not, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Boardin any manner:
(i) make (A) acquire, or offer, seek or agree to acquire, whether by purchase, tender or exchange offer, through the acquisition of control of another person, by joining or forming a partnership, limited partnership, syndicate or other group (including any public announcementgroup of persons that would be treated as a single “person” under Section 13(d) of the Exchange Act (as defined below)), through swap or hedging transactions, other Synthetic Positions or otherwise (the taking of any such action, an “Acquisition”), Beneficial Ownership (including notional shares associated with any Derivatives or other Synthetic Positions) of any securities or assets of the Company (or any direct or indirect rights or options to acquire such ownership, including voting rights decoupled from the underlying Voting Securities) such that after giving effect to any such Acquisition, the Circumference Group or any of its Affiliates and Associates holds, directly or indirectly, in excess of 9.9% of the Voting Securities, or (B) acquire, or offer, seek or agree to acquire, whether by purchase or otherwise, any interest in any indebtedness of the Company;
(ii) (A) nominate, give notice of an intent to nominate, or recommend for nomination a person for election to the Board or (unless the Board recommends in favor of such removal) take any action in respect of the removal of any director, (B) seek or knowingly encourage any person to submit any nomination in furtherance of a “contested solicitation” or the election or removal of any director (in each case other than pursuant to Section 1), (C) submit, or seek or knowingly encourage the submission of, any stockholder proposal (pursuant to Rule 14a-8 under the Exchange Act or offer otherwise) for consideration at, or bring any other business before, any Stockholder Meeting, (D) request, or knowingly initiate, knowingly encourage or participate in any request, to call a Stockholder Meeting, (E) publicly seek to amend any provision of the Amended and Restated Certificate of Incorporation, Amended and Restated Bylaws (the “Bylaws”) or other governing documents of the Company (each as may be amended from time to time), or (F) take any action similar to the foregoing with respect to any subsidiary of the Company;
(iii) solicit any proxy, consent or other authority to vote of stockholders (other than from Circumference Group and its Affiliates and Associates with respect to shares of Voting Securities which the Circumference Group or such Affiliate or Associate has the right or ability to vote) or conduct any other referendum (binding or non-binding) (including any “solicitationwithhold,” of “proxiesvote no” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents similar campaign) with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on from the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination holders of, or recommend the nomination ofVoting Securities, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A promulgated under the Exchange Act) in any such solicitation of proxies in, or consents;
(v) disclose to any Third Partyknowingly assist, either publicly or in a manner that would reasonably be expected to result in or require public disclosureadvise, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision)initiate, except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any person (other Person than the Company or, solely with respect to shares of Voting Securities which the Circumference Group or such Affiliate or Associate has the right or ability to vote, the members of the Circumference Group and its Affiliates and Associates) to conduct (A) or seek to influence any person other the giving Company or withholding its Affiliates or Associates in the conduct of), any “solicitation” of any proxy relating toproxy, consent or other authority to vote, vote any Voting Securities, or Securities (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such assistance, advice, encouragement or advice influence that is consistent with the Board’s recommendation in connection with such matter); provided, however, that the foregoing shall not restrict the Circumference Group or as otherwise expressly permitted by this Agreementits Affiliates or Associates from stating how they intend to vote with respect to an Extraordinary Transaction, if any, that has been publicly submitted for the approval of the Company’s stockholders and the reasons therefor;
(viiiv) form(A) grant any proxy, join, knowingly encourage consent or knowingly participate in or knowingly act in concert with any Group other authority to vote with respect to any Voting Securities, other than solely with Affiliates matters for any Stockholder Meeting or (B) deposit any securities of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into Company in any voting trust, trust or subject any securities of the Company to any arrangement or agreement with respect to the voting of any Voting Securitiessuch securities of the Company, or subject any Voting Securities to any voting trust, arrangement or agreement in each case of clauses (excluding A) and (B) other than (1) customary brokerage accounts, margin accounts, prime brokerage accounts and the like), similar accounts (in each case other than (A) this Agreementso long as the Circumference Group or its Affiliates or Associates retains control with respect to the securities deposited in such accounts), (B) solely between or among the Live Parties and their Affiliates, or (C2) granting any proxy proxy, consent or other authority to vote in any solicitation approved by the Board and consistent with the recommendation of the Board, and (3) granting any proxy, consent or other authority to vote in any solicitation in connection with any matter for which the Circumference Group or its Affiliates or Associates retains voting discretion pursuant to, and in accordance with, Section 2(b);
(v) knowingly encourage, advise or seek to influence any person, or knowingly assist any person in so encouraging, advising or influencing any person, with respect to the giving or withholding of any proxy, consent or authority to vote any Voting Securities or in conducting any referendum (binding or non-binding) (including any “withhold,” “vote no,” or similar campaign), in each case other than such encouragement, advice or influence that is consistent with the Board’s recommendation in connection with such matter or otherwise in connection with an Extraordinary Transaction that has been publicly submitted for the approval of the Company’s stockholders; provided, however, that the foregoing shall not restrict the Circumference Group or its Affiliates or Associates from stating how they intend to vote with respect to an Extraordinary Transaction, if any, that has been publicly submitted for the approval of the Company’s stockholders and the reasons therefor;
(vi) without the prior written approval of the Company, separately or in conjunction with any other person in which it is or proposes to be either a principal, partner or financing source or is acting or proposes to act as broker or agent for compensation, propose, suggest or recommend publicly (or in a manner such that the Circumference Group is required under applicable law, rule or regulation to disclose publicly) or participate in, effect or seek to effect any Extraordinary Transaction or knowingly encourage any other third party to participate in, effect or seek to effect any Extraordinary Transaction; provided, that nothing in this Section 2(a)(vi) shall be interpreted to prohibit the Circumference Group from (1) proposing, suggesting or recommending any Extraordinary Transaction privately to the Company so long as any such action is not publicly disclosed by the Circumference Group (and is made by the Circumference Group in a manner that would not reasonably be expected to require the public disclosure thereof by the Company, the Circumference Group or any other person), (2) stating how they intend to vote with respect to an Extraordinary Transaction, if any, that has been publicly submitted for the approval of the Company’s stockholders and the reasons therefor or (3) tendering shares, receiving consideration or other payment for shares, or otherwise participating in any publicly announced Extraordinary Transaction on the same basis as other stockholders of the Company;
(vii) form, join, encourage the formation of, or in any way participate in any partnership, limited partnership, syndicate or group (within the meaning of Section 13(d)(3) of the Exchange Act) with respect to any Voting Securities (other than a group that includes all or some of the members of the Circumference Group or its Affiliates or Associates, but does not include any other entities or persons that are not members of the Circumference Group as of the date hereof; provided that nothing herein shall limit the ability of an Affiliate of the Circumference Group to join such group following the execution of this Agreement, so long as any such Affiliate agrees to be bound by the terms and conditions of this Agreement);
(viii) make or publicly advance any request or proposal to amend, modify or waive any provision of this Agreement, or (other than in connection with any legal proceeding that was not initiated by Circumference Group or its Affiliates or Associates) take any action challenging the validity or enforceability of any provision of or obligation arising under this Agreement; provided that the Circumference Group may make confidential requests to the Board to amend, modify or waive any provision of this Agreement, which the Board may accept or reject in its sole and absolute discretion, so long as any such request is not publicly disclosed by the Circumference Group and is made by the Circumference Group in a manner that would not reasonably be expected to require the public disclosure thereof by the Company, the Circumference Group or any other person;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from make a decline in the market price or value of any request for a list of the Company’s securities stockholders or for any books and would, records of the Company pursuant to Section 220 of the General Corporation Law of the State of Delaware (the “DGCL”) or any other statutory or regulatory provisions providing for stockholder access to books and records; provided that Fox shall not be prohibited from making any such request in the aggregate or individually, result in the Live Parties ceasing to have his capacity as a Net Long Position in director of the Company;
(x) sell, offer make any public proposal with respect to (A) any change in the number or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates identity of directors of the Live PartiesCompany or the filling of any vacancies on the Board other than as provided under Section 1 of this Agreement or (B) any other change to the Board or the Company’s management, or corporate or governance structure;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) withdiscussion, or advisenegotiation, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to concerning any of the foregoing matters(other than this Agreement) or (in each case, so long as intentionally) encourage, assist, solicit or seek to cause any such communication is (x) not released publicly by the Live Parties or their Representatives or person to undertake any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in action inconsistent with this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the CompanySection 2.
Appears in 1 contract
Standstill. During the Cooperation Period, each Live Party will not, and will cause its Affiliates and its Representatives acting on behalf of the Live Parties period (collectively with the Live Partiessuch period, the “Restricted PersonsStandstill Term”) commencing as of the Closing Date and continuing until the later of (A) the date that concludes any 90 day continuous period during which no Investor Designee serves on the Board, provided that, notwithstanding the foregoing, if the Investor subsequently designates a new Investor Designee that serves on the Board following such 90-day period, the Standstill Term shall be reinstated commencing as of such date that such new Investor Designee serves on the Board, and (B) the date on which the Investor and its Affiliates beneficially own less than five percent (5.0%) of the shares of Common Stock then issued and outstanding, neither the Investor nor any Investor Affiliate Assignee Parent shall do any of the following, either directly or indirectly by causing, requesting or directing its Affiliates to notdo any of the following, except as expressly approved or invited in writing by the Company:
(a) other than Permitted Purchases and purchases of Additional Subscription Shares, directly or indirectly, without acquire beneficial ownership of Common Stock and/or Common Stock Equivalents and/or any instrument that gives the prior written consentInvestor or any of its Affiliates the economic equivalent of ownership of an amount of securities of the Company (a “Derivative”), invitationexcept, nothing in this Section 3.1(a) shall prevent or authorization prohibit the Investor or any of its Affiliates from (i) investing in a fund with respect to which the Investor or any of its Affiliates does not have or share decision-making authority over investment or divestment decisions; or (ii) in the case of an Affiliate that is a private equity fund or a credit fund, investing through a portfolio company of such fund;
(b) make a tender, exchange or other public offer to acquire Common Stock and/or Common Stock Equivalents;
(c) directly or indirectly, (i) seek to have called any meeting of the stockholders of the Company or propose any matter to be voted upon by the Board:
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies stockholders of the Company, including any change in the number of directors serving on or (ii) propose or nominate for election to the Board or the filling any person whose nomination has not been approved by a majority of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require excluding the Company to waive) any of the terms of this AgreementInvestor Designee, if any);
(iid) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap encourage, accept or hedging transactions support a tender, exchange or otherwise, all other offer or substantially all, voting rights decoupled from the underlying Common Stock held proposal by a Live Party any other Person or Affiliates group (an “Offeror”) for securities of the Live Parties;
Company (xi) instituteif such offer or proposal would, solicit if consummated, result in a Change of Control of the Company, such offer or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity proposal is referred to as such (other than to enforce rights under this Agreementan “Acquisition Proposal”); provided, however, that for from and after the avoidance filing of doubta Schedule 14D-9 (or successor form of Tender Offer Solicitation/Recommendation Statement under Rule 14d-9 of the Exchange Act) by the Company recommending that stockholders accept any such offer filed after such offer has commenced, the foregoing Investor shall not prevent any Live Party be prohibited from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do taking any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement otherwise prohibited by this Section 3(c3.1(d) for so long as the Board maintains and does not withdraw such recommendation;
(e) directly or indirectly, solicit proxies or consents or propose or seek or become a participant in a solicitation (as such terms are defined in Regulation 14A under the Exchange Act), or make seek to advise or influence any investment in or enter into Person, with respect to voting of any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director securities of the Company;
(xvif) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make deposit any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman Company in a voting trust or subject any securities of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting arrangement or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving the voting of such securities, including the granting of any proxy;
(xg) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets propose (whether by i) any merger, consolidation, business combination, tender or exchange offer, purchase of the Company’s assets or businesses, purchase of any securities of the Company or any Derivative, or any similar transaction involving the Company or (ii) any recapitalization, restructuring, saleliquidation or other extraordinary transaction with respect to the Company, equity issuance or otherwisein each case without the prior written consent of the Board (a transaction described in clauses (i) or and (yii) the issuance that would result in a Change of securities representing or convertible into or exchangeable or exercisable forControl, is referred to as a “Business Combination”);
(h) act in concert with any Third Party to take any action in clauses (a) through (g) above, or, directly or indirectly, more than 25% form, join or in any way participate in a “partnership, limited partnership, syndicate, or other group” as such terms are used in the rules of the Common Stock, in the case of each of clause (x) and (y), SEC with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor respect to the Company or any securities of the Company;
(i) request or propose to the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a directoror any of its officers, directors, Affiliates employees, attorneys, accountants, financial advisors and other professional representatives), with respect to directly or indirectly, any amendment or waiver of the foregoing matters, so long as any such communication is provision of this Section 3.1 (xincluding this clause (i));
(j) not released publicly by the Live Parties or their Representatives or make any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would requirepublic announcement regarding, or reasonably be expected to require, the Live Parties or take any action that could require the Company to make a public announcement regarding such proposal. For regarding, a potential Business Combination or any of the avoidance of doubtmatters set forth in clauses (a) through (i) above; or
(k) enter into discussions, negotiations, arrangements or agreements with any Person relating to the foregoing actions referred to in (a) through (i) above; provided, however, that nothing contained in this Agreement Section 3.1 shall prevent prohibit the Investor or limit any of its Affiliates from making confidential, nonpublic proposals to the Live Parties or their respective Affiliates and Representatives from working Board for a transaction involving a Business Combination following the public announcement by the Company after the Closing Date that it has entered into a definitive agreement with the Live Parties a Third Party for a transaction involving a Business Combination, or the Live Parties’ other Representatives for Investor Designee from performing its duties as a member of the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the CompanyBoard.
Appears in 1 contract
Standstill. During (A) Subject to Section 4.03(B), each Purchaser agrees that, during the Cooperation Standstill Period, each Live Party will it shall not, and will shall cause each of its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notnot to, directly or indirectly, without the absent prior express written consent, invitation, invitation or authorization by the Board of Directors, in each case with respect to the Company or the BoardCompany:
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv1) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) defined under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A promulgated under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi2) knowingly encourage encourage, advise or advise influence any Third Party other Person or knowingly assist any Third Party Person in encouraging so encouraging, advising or advising influencing any other Person with respect to (A) the giving or withholding of any proxy relating toproxy, consent or other authority to vote, vote any Voting Securities, Stock or (B) in conducting any type of referendum relating to the Company referendum, binding or non-binding, of holders of Voting Stock (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than any such encouragement encouragement, advice or advice influence that is (x) consistent with the BoardCompany management’s recommendation in connection with such matter, matter or as otherwise expressly permitted (y) that is directed at such Purchaser’s Affiliate with respect to Voting Stock now or hereafter owned by this Agreementsuch Affiliate);
(vii3) form, join, knowingly encourage join or knowingly participate in or knowingly act in concert with any Group partnership, limited partnership, syndicate or other group, including a “group” as defined pursuant to Section 13(d) of the Exchange Act, with respect to any Voting SecuritiesStock, other than solely with other such Purchaser’s Affiliates of the Live Parties with respect to Voting Securities Stock now or hereafter owned by them;
(viii4) enter into acquire, or offer, seek or agree to acquire, by purchase or otherwise, or direct any voting trustthird party in the acquisition of, arrangement or agreement with respect to any Voting SecuritiesStock, or subject rights or options to acquire any Voting Securities to Stock if such acquisition would result in such Purchaser and its Affiliates having Beneficial Ownership of more than 20% of the outstanding Company Common Stock;
(5) make or in any voting trustway participate, arrangement directly or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like)indirectly, in each case any tender offer, exchange offer, merger, consolidation, acquisition, business combination, sale of a division, sale of substantially all assets, recapitalization, restructuring, liquidation, dissolution or extraordinary transaction involving the Company or any of its Subsidiaries or its or their securities or assets (each, an “Extraordinary Transaction”) (it being understood that the foregoing shall not restrict such Purchaser’s Affiliates from participating on the same basis as other than stockholders of the Company in any such transaction that has been approved by the Board of Directors); or make, directly or indirectly, any proposal, either alone or in concert with others, to the Company or the Board of Directors that would reasonably be expected to require a public announcement regarding any of the types of matters set forth above in this paragraph;
(6) (A) this Agreementseek, alone or in concert with others, election or appointment to, or representation on, the Board of Directors or nominate or propose the nomination of, or recommend the nomination of, any candidate to the Board of Directors, (B) solely between seek, alone or among in concert with others, the Live Parties and their Affiliates, removal of any member of the Board of Directors or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation conduct a referendum of the Board;
(ix) engage in any short sale or any purchase, sale, or grant stockholders of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x7) sell, offer make or agree be the proponent of any stockholder proposal (pursuant to sell, directly or indirectly, through swap or hedging transactions Rule 14a-8 under the Exchange Act or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties);
(xi8) make any request for stock list materials or other books and records of the Company under Section 220 of the DGCL or other statutory or regulatory provisions providing for shareholder access to books and records;
(9) make any public proposal with respect to (A) any change in the number or term of directors or the filling of any vacancies on the Board of Directors, (B) any material change in the capitalization of the Company, (C) any other material change in the Company’s management, business or corporate structure, (D) any waiver, amendment or modification to the Company’s certificate of incorporation or bylaws, or other actions which may impede the acquisition of control of the Company by any person, (E) causing a class of securities of the Company to be delisted from, or to cease to be authorized to be quoted on, any securities exchange or (F) causing a class of equity securities of the Company to become eligible for termination of registration pursuant to Section 12(g)(4) of the Exchange Act;
(10) institute, solicit solicit, assist or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each ) in their capacity as such (other than order to enforce rights under effect or take any of the actions expressly prohibited by this Agreement)paragraph; provided, however, that for the avoidance of doubt, doubt the foregoing shall not prevent any Live Party such Purchaser’s Affiliate from (A) bringing litigation against the Company to enforce any express provision the provisions of this Agreement instituted in accordance with and subject to Section 11Agreement, (B) making any counterclaim counterclaims with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates any other Person against any Live Partysuch Purchaser’s Affiliate, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this AgreementAgreement or the topics covered in the correspondence between the Company and such Purchaser’s Affiliates prior to the date hereof, or (D) exercising statutory appraisal rights; provided, or (E) further, that the foregoing shall also not prevent such Purchaser’s Affiliates from responding to or complying with a validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii11) enter into any negotiations negotiations, agreements or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, understandings with any Third Party to take any action or make any statement that such Purchaser’s Affiliates are prohibited by from taking pursuant to this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);4.03; or
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii12) make any request or submit any proposal proposal, directly or indirectly, to amend or waive any of the terms of this Agreement (including this subclause)Agreement, in each case publicly or that which would reasonably be expected to give rise to result in a requirement to publicly announce or disclose public announcement of such request or proposal; provided that the .
(B) The restrictions in this Section 3(c4.03(A) shall terminate automatically in upon the event earliest of a material breach of this Agreement (i) the announcement by the Company if such material breach has not been cured within five (5) Business Days following of a definitive agreement with respect to any Extraordinary Transaction that would directly or indirectly result in the Live Parties providing written notice to the Company acquisition of such material breach (provided that the Live Parties are not in material breach beneficial ownership by any person or group of this Agreement at the time such notice is given 50% or prior to the end more of the notice period); providedoutstanding Company Common Stock, further, that in 50% or more of the event that voting power of the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than outstanding Voting Stock or all or substantially all of the Company’s 2026 annual meeting assets and (ii) the commencement of stockholders any tender or exchange offer (by a person other than the “2026 Annual Meeting”Purchasers or their Affiliates), then which, if consummated, would constitute an Extraordinary Transaction that would directly or indirectly result in the restrictions and obligations set forth in Section 3 shall remain in effect until acquisition of beneficial ownership by any person or group of 50% or more of the outstanding Company Common Stock or 50% or more of the voting power of the outstanding Voting Stock, where the Company files a Schedule 14D-9 (or be reinstated any amendment thereto), other than a “stop, look and be applicable untillisten” communication by the Company pursuant to Rule 14d-9(f) promulgated under the date Exchange Act, that is thirty (30) calendar days prior to the notice deadline under does not recommend that the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement stockholders reject such tender or exchange offer.
(including the restrictions C) Nothing in this Section 3(c)4.03 shall (i) will prohibit or restrict prevent any Restricted Person Purchasers’ Affiliate from making (Ix) making any public or private proposal, negotiating, seeking financing for statement or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), announcement with respect to an Extraordinary Transaction between that is publicly announced by the Live Parties Company or a Third Party (and nothing in this Agreement shall prevent the CompanyCompany from responding to such statements), (IIy) making any factual statement to comply with any subpoena as required by applicable legal process, subpoena, or other legal process requirement or respond as part of a response to a request for information from any governmental authority with jurisdiction over such Restricted Person the party from whom information is sought (so long as such process or request did not arise as a result of any discretionary act acts by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company Purchaser or any of its Affiliates) or (z) any confidential oral communication or proposal to management or the Restricted Persons, Board of Directors or (VIIii) subject affect such Purchaser or such Purchaser’s Affiliates’ ability to Section 3(b), privately communicating with other Third Parties, including those beneficially owning hold the Notes or hold or vote any shares of Company Common Stock, about including the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Company Common Stock. Stock issuable or issued upon conversion of the Notes.
(D) Notwithstanding anything herein in this Section 4.03 to the contrary, the restrictions set forth prohibitions in this Agreement Section 4.03 shall not immediately terminate without further force or effect and such Purchaser and such Purchaser’s Affiliates shall be released from compliance therewith if the Company (i) prohibit institutes a voluntary proceeding, or becomes the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and subject of an involuntary proceeding which involuntary proceeding is not dismissed within sixty (ii60) apply to days, under any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisorbankruptcy act, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties insolvency law or any law for the relief of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Companydebtors, (ii) any financial advisorhas a receiver appointed to manage its affairs, legal counsel which appointment is not dismissed, vacated or other advisor to the Company or the Board stayed within sixty (60) days or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also executes a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives general assignment for the purpose benefit of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companycreditors.
Appears in 1 contract
Sources: Investment Agreement (Eos Energy Enterprises, Inc.)
Standstill. During (a) So long as the Cooperation PeriodCompany has not breached this Agreement, each Live Party member of the Investor Group and their Affiliates severally, and not jointly, agrees that during the period commencing on the date hereof and ending on the Termination Date, without the prior written consent of the Board specifically expressed in a written resolution adopted by a majority vote of the entire Board, he, she or it will not, and will cause each of his, her or its Affiliates officers, agents and its Representatives other Persons acting on his, her or its behalf of not to, and will use commercially reasonable efforts to cause his, her or its respective Associates (as defined in Section 11 hereof) including but not limited to those Associates identified in the Live Parties Schedule 13D not to:
(collectively with the Live Partiesi) engage, the “Restricted Persons”) to notor in any way participate, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary defined in Rule 14a-2 under 14a-1(l) promulgated by the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) SEC under the Exchange Act) of one or more proxies or consents with respect (whether or not relating to the election or removal of one directors), advise, encourage or more directors of the Company or influence any other matter or proposal relating Person (as defined in Section 11 hereof) with respect to the Company voting of any Voting Securities with respect to the 2006 Annual Meeting or become the 2007 Annual Meeting in a manner that is inconsistent with the terms of this Agreement; or otherwise “participantsolicit” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A Rule 14a-1(l) promulgated by the SEC under the Exchange Act) in stockholders of the Company for the approval of stockholder proposals whether made pursuant to Rule 14a-8 or Rule 14a-4 or exempt solicitations pursuant to Rule 14a-2(b)(1) Rule 14a-2(b)(2) under the Exchange Act or otherwise induce or encourage any other Person to initiate any such solicitation of proxies or consentsstockholder proposal;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(viiii) form, join, knowingly encourage join or knowingly in any way participate in or knowingly act in concert with any Group “group” (within the meaning of Section 13(d)(3) of the Exchange Act) with respect to any Voting Securities, other than solely with Affiliates a “group” that includes all or some lesser number of the Live Parties with respect to Voting Securities now or hereafter owned by themPersons identified as “Reporting Persons” in the Schedule 13D, but does not include any other members who are not currently identified as Reporting Persons;
(viiiiii) enter into other than as previously disclosed in the Schedule 13D, deposit any Voting Securities in any voting trust, arrangement or agreement with respect to any Voting Securities, trust or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value voting of any of the Company’s securities and wouldVoting Securities, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity except as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions expressly set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiiiiv) enter into any negotiations arrangements, understanding or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade assist or knowingly encourage, any Third Party to take other Person in connection with any action or make any statement prohibited by this Section 3(c)of the foregoing, or make any investment in or enter into any agreement with arrangement with, any other person Person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c)foregoing;
(xivv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of request the Company or nominee for director of the Company;
(xvi) except as required by applicable lawits advisers, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request directly or submit any proposal indirectly, to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision provisions of this Agreement, as long as such private communications except for amendments or requests would waivers not reasonably be expected of a material nature;
(vi) take any initiative with respect to require public disclosure of such communications or requests by the Company or any of its subsidiaries which involves making a public announcement or that could require the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties Company or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company its subsidiaries to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction initiative or any transactions involving of the activities referred to in any of these subparagraphs (i) through (vi); or
(vii) take or cause or induce others to take any action inconsistent with any of the foregoing.
(b) It is understood and agreed that the foregoing shall not be deemed to prohibit any of the members of the Investor Group who are directors of the Company from engaging in any lawful acts in the exercise of their fiduciary duties as directors of the Company.
Appears in 1 contract
Standstill. During (a) Purchaser agrees that, from and after the Cooperation Period, each Live Party will not, and will cause its Affiliates and its Representatives acting on behalf Closing until the later of (x) the first anniversary of the Live Parties Closing and (collectively with y) such time as the Live PartiesPurchaser Preferred Percentage is no longer equal to or greater than 7.5%, the “Restricted Persons”) to Purchaser shall not, directly or indirectly, without the prior written consent, invitation, or authorization do any of the following unless requested or approved in advance in writing by the Company or (acting through the Company Board:):
(i) make (A) make, or in any public announcementway participate in, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A within the meaning of Rule 14a-1 under the Exchange Act) to vote any Voting Stock of the Company or its Subsidiaries, (B) call or seek to call a meeting of the Company’s stockholders or initiate any stockholder proposal for action by the Company’s stockholders or (C) seek the removal of any director from the Company Board (other than the Series B-1 Preferred Director)), written consents ;
(ii) make any public announcement with respect to, or otherwise solicit, seek, cause, offer submit a proposal or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination offor, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under extraordinary transaction involving the Company or any provisions of federal or state bankruptcy law or consents its Subsidiaries (other than (A) any nonpublic proposal to the filing of Company Board that would not require the Company, Purchaser or any bankruptcy petition under other Person to make any similar applicable law. Notwithstanding anything herein public announcement or other disclosure with respect thereto or (B) any public disclosure in any filings by Purchaser or its Affiliates with the SEC to the contraryextent required by applicable Law or stock exchange rules);
(iii) form, nothing join or in any way participate in a “group” (as defined in Section 13(d)(3) of the Exchange Act) in connection with any Voting Stock of the Company or its Subsidiaries, including with the Viking Purchaser; provided, that taking any action contemplated by this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, not constitute a violation of this Section 6.17(a)(iii); or
(iiv) the Board or take any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner action that would require, or reasonably be expected to require, the Live Parties or require the Company to make a public announcement regarding such proposal. For the avoidance of doubtany actions prohibited by this Section 6.17(a); provided, that nothing contained in this Agreement Section 6.17(a) shall prevent limit, restrict or limit prohibit (x) any confidential, non-public discussions with or communications or proposals to management or the Live Parties Company Board by Purchaser or their respective its Affiliates and or Representatives from working related to any of the foregoing, (y) any Purchaser Party’s ability to vote, Transfer, convert, exercise its rights under Section 6.16 or otherwise exercise rights with respect to its Series B-1 Preferred Stock or Company Common Stock in accordance with the Live Parties terms and conditions of this Agreement and the Certificate of Designations or (z) the ability of the Series B-1 Preferred Director to vote or otherwise exercise his or her duties or otherwise act in his or her capacity as a member of the Company Board.
(b) Notwithstanding the foregoing, the restrictions set forth in Section 6.17(a) shall not apply if any of the following occurs:
(i) the Company enters into a definitive agreement providing for a merger, consolidation or other business combination transaction as a result of which the stockholders of the Company would own Voting Stock of the resulting corporation having 50% or less of the votes that may be cast generally in an election of directors if all outstanding Voting Stock were present and voted at a meeting held for such purpose;
(ii) a tender offer or exchange offer for a majority of the capital stock of the Company is commenced by a third person (other than Purchaser and its Affiliates), which tender offer or exchange offer, if consummated, would result in a Change of Control (as defined in the Certificate of Designations), and either the Company Board recommends that the stockholders of the Company tender their shares in response to such offer or does not recommend against the tender offer or exchange offer within ten Business Days after the commencement thereof; or
(iii) the Company solicits from one or more Persons, or enters into discussions with one or more Persons, regarding a proposal with respect to a merger of, or a business combination transaction involving, the Company without similarly soliciting a proposal from Purchaser, or the Live Parties’ other Representatives for Company makes a public announcement, with the purpose approval of evaluatingthe Company Board, negotiating the terms of and consummating the Transaction or any transactions involving the Companythat it is seeking to sell itself.
Appears in 1 contract
Sources: Series B 1 Convertible Preferred Stock Purchase Agreement (Fluidigm Corp)
Standstill. During (a) For so long as (i) an Initial Stockholder Designee is on the Cooperation Board, (ii) a Holder Designee is on the Board and the Initial Stockholder constitutes the Majority Approved Holders or (iii) the aggregate Percentage Ownership of the Initial Stockholder and its Affiliates is equal to or greater than thirty-five percent (35%), and in each case for a six (6) month period thereafter (the “Standstill Period”), each Live Party the Initial Stockholder will not, and will cause its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Partiesand their principals, the “Restricted Persons”) to notgeneral partners, directly or indirectlyofficers and employees not to, without the prior written consent, invitation, or authorization consent of a majority of the Company Non-Designated Directors, directly or the Board:
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seekindirectly, alone or in concert with one others:
(i) (A) on or more Third Partiesprior to the date that is 90 days following the consummation of the Offer, election acquire, offer or appointment topublicly announce its intention to acquire, by purchase or otherwise, additional shares of Common Stock or direct or indirect rights, warrants or options to acquire, or representation onsecurities exchangeable for or convertible into, Common Stock or (B) following the date that is 90 days following the expiration of the Offer (as may be extended), acquire, offer or publicly announce its intention to acquire, by purchase or otherwise, additional shares of Common Stock or direct or indirect rights, warrants or options to acquire, or securities exchangeable for or convertible into, Common Stock that would increase the Initial Stockholder’s and its Affiliates’ aggregate Percentage Ownership, calculated in accordance with the beneficial ownership rules set forth in Rule 13d-3 promulgated under the Exchange Act, to more than forty-five percent (45%) (any such additional shares of Common Stock acquired, the “Additional Shares”); provided that the Initial Stockholder and its Affiliates shall be permitted to make private offers to the Board to acquire additional shares of Common Stock or publicly nominate, indicate an intention to nominateConvertible Preferred Stock;
(ii) make, or propose the nomination of, or recommend the nomination ofin any way participate in, any candidate solicitation of proxies to vote or seek to advise or influence in any manner whatsoever any person with respect to the Boardvoting of any voting securities of the Company, seekother than in support of the Company’s nominees;
(iii) make, announce, disclose publicly, propose publicly or induce or attempt to induce any other person to initiate any stockholder proposal;
(iv) form, join or any way participate in a “group” within the meaning of Section 13(d)(3) of the Exchange Act with respect to any voting securities of the Company;
(v) acquire, offer to acquire or agree to acquire, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records assets of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;; or
(vi) knowingly encourage or advise seek to propose to the stockholders any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating tomerger, business combination, restructuring, recapitalization or other authority transaction to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;; or
(vii) formmake any public request or proposal to amend, join, knowingly encourage waive or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing terminate any provision of this Agreement;Section 2.4.
(xiiib) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Notwithstanding Section 3(c2.4(a), or make the Initial Stockholder and its Affiliates shall not be prohibited from making any investment in or enter into any agreement with any other person that engages, or offers or proposes non-public proposal to engage, in any of the actions prohibited by this Section 3(c);Board.
(xivc) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Notwithstanding Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause2.4(a), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that if at any time during the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); providedStandstill Period, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive any agreement with respect any third party that would result in a Change of Control, (ii) an unaffiliated third party commences a bona fide tender or exchange offer which, if consummated, would constitute a Change of Control and the Board either accepts such offer or fails to recommend that its stockholders reject such offer within ten (10) business days from the date of commencement of such offer or (iii) the Company announces a process seeking to solicit a third party to enter into a transaction involving which is likely to result in a Change of Control, then the standstill restrictions set forth in Section 2.4(a) shall terminate.
(xd) Notwithstanding Section 2.4(a), if at any time during the sale or transfer Standstill Period, an unaffiliated third party commences a bona fide proxy solicitation which, if successful, would constitute a Change of all or Control (a controlling portion “Proxy Contest”), then the restrictions set forth in Sections 2.4(a)(ii), (iii) and (iv) shall cease to apply, but only in respect of support of the Company’s equity securities or all or a substantially all of the Companynominees and opposition to such third party’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner nominees for that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the CompanyProxy Contest.
Appears in 1 contract
Standstill. 6.1.1 The standstill obligation, as set out in this Article 6.1, will take effect as of the Date of this Agreement and will terminate on the earlier of (x) the date that is ten (10) years following the date on which the Closing occurs and (y) the termination of this Agreement if the Closing does not occur (the “Standstill Period”).
6.1.2 During the Cooperation Standstill Period, each Live Party will not, and will cause its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live PartiesInvestor, the “Restricted Persons”) to Parent Investor or any of their Affiliates, shall not, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A without the express written consent of the Exchange Act))Issuer, written consents with respect todirectly or indirectly acquire any additional Equity Securities (other than the Warrants) of the Issuer, or otherwise solicit, seek, cause, offer or offer if after giving effect to effect, (A) any proposal to seek representation on such acquisition the Board or otherwise seek to control or influence the managementInvestor, the Board or the policies of the CompanyParent Investor, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms Affiliates of this Agreementthe Investor or the Parent Investor, or any other party Acting in Concert with the Investor, the Parent Investor or any of the Affiliates of the Investor or the Parent Investor would (without taking into account the Warrants or the shares issuable (but not yet issued) thereunder owned by them at that time) together in the aggregate directly or indirectly own or have the right to acquire more than 29.9% of the then issued and outstanding voting securities of the Issuer (assuming the exercise, conversion or exchange of any Equity Securities held by any of them at any time (other than the Warrants) that are exercisable, convertible or exchangeable into or for shares of the Issuer at such time) (the resulting number of securities rounded down) (the “Standstill Limit”);
(ii) seek, alone directly or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, indirectly encourage or participate in any “withhold” support a tender, exchange or similar campaign with respect to any meeting of stockholdersother offer or proposal by a third party;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
propose (iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services fora) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, purchase of the Issuer’s assets or businesses, or similar transaction involving the Issuer or (b) any recapitalization, restructuring, sale, equity issuance liquidation or otherwiseother extraordinary transaction with respect to the Issuer (it being understood that the Investor’s Chief Executive Officer may contact the Issuer’s Chief Executive Officer on a non-public and non-committal basis to gauge the Issuer’s Chief Executive Officer’s views on the Issuer’s potential interest in any such matter described in clause (a) or (yb)); or
(iv) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectlyindirectly (a) submit matters to, more than 25% request that matters be submitted to, or request the convening of, a general meeting of the Common Stockshareholders of the Issuer, or (b) solicit proxies or consents, or become a participant in a solicitation in relation to matters submitted to a general meeting of the shareholders of the Issuer, in the each case of each of clause (xa) and (y), b) without or against the recommendation or support by the Board of Directors except that Investor may solicit proxies or consents and may become a participant in a solicitation in connection with any Person other than proposal that would adversely affect its rights under this Agreement, the Warrants, or the Option, License and Collaboration Agreement or as a Live Party or an Affiliate shareholder of the Live Parties or (ii) Issuer, and may also make a proposal pursuant to Article 7.3.1, provided that the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents this Article 6.1.2(iv) shall automatically cease to apply when the filing Investor ceases to have the right to appoint Investor Board Designees pursuant to Article 7.3;
(a) make public statements with respect to (save if legally obliged to) or, (b) with the actual knowledge of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contraryParent Investor’s executive officers, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals provide assistance to, commit to, or otherwise communicating withdiscuss or enter into any agreement or arrangement with any party to do, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing mattersprohibited actions provided that in relation to prohibited actions in subsection (ii) that have been committed without the actual knowledge of the Parent Investor’s executive officers, so long as any the Investor and Parent Investor shall promptly terminate and unwind such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect actions upon written request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the CompanyIssuer.
Appears in 1 contract
Standstill. During (a) Each Sponsor agrees that, until the Cooperation PeriodStandstill Termination Date, without the prior consent of the Board of Directors (excluding any Board Designee), such Sponsor shall not and such Sponsor shall cause each Live Party will not, and will cause of its Affiliates not to, directly or indirectly:
(i) acquire or Beneficially Own Voting Stock or authorize or make any offer to acquire Voting Stock, if the effect of such acquisition or offer (if consummated) would be to increase the percentage of the Voting Stock represented by all shares of Voting Stock Beneficially Owned by such Sponsor and its Representatives acting on behalf Affiliates to more than 1% of the Live Parties Voting Stock outstanding (collectively with the Live Partiesnot including any Common Stock received by a Purchaser upon conversion of any Note);
(ii) authorize, the “Restricted Persons”commence, encourage, support or endorse any tender offer or exchange offer for shares of Voting Stock;
(iii) to notmake, or in any way participate, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) make any public announcement, proposal or offer (including in any “solicitation” of “proxies” to vote (as such terms are defined or used in Regulation 14A the rules of the SEC), or seek to advise or influence any Person with respect to the voting of any Voting Stock;
(iv) publicly announce or submit to the Company a proposal or offer concerning (with or without conditions) any extraordinary transaction involving the Company or any successor thereto, any Subsidiary or division thereof, or any of their securities or assets;
(v) form, join or in any way participate in a “group” as defined in Section 13(d)(3) of the Exchange Act)), written consents with respect tofor the purpose of acquiring, holding, voting or otherwise solicit, seek, cause, offer or offer to effect, (A) disposing of any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies securities of the CompanyCompany (provided that nothing herein shall prohibit the Purchasers and their Affiliates from coordinating, including among themselves and transferees, disposition of Securities held by them);
(vi) take any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement action that is directly contrary could reasonably be expected to (or may require the Company or any successor thereto to waive) make a public announcement regarding the possibility of any of the terms of this Agreementevents described in clauses (i) through (v) above;
(iivii) seek, alone or in concert enter into any arrangements with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of third party concerning any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;foregoing; or
(iiiviii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Representatives, directly or indirectly, to amend or waive any provision of this Section 220 5.6.
(b) The restrictions set forth in Section 5.6(a) will not apply as to a Sponsor and its Affiliates if any of the Delaware General Corporation Law following occurs (provided that if any event described in this Section 5.6(b) occurs and, during the twelve-month period following such event, none of the transactions described in clauses (ii), (iii) or (iv) of the definition of Designee Termination Date has occurred, then the restrictions set forth in Section 5.6(a) will thereafter resume and continue to apply to KKR if a Board Designee is then serving as a member of the Board of Directors, provided, further, at the time of any such resumption of the restrictions set forth in Section 5.6(a), if the number of shares of Voting Stock then Beneficially Owned by KKR and its Affiliates exceeds 1% of the Voting Stock outstanding (not including any Common Stock received by a Purchaser upon conversion of any Notes), neither KKR nor any of its Affiliates shall be required to dispose of any shares of Voting Stock Beneficially Owned by them but, in such event, neither KKR nor any of its Affiliates may then acquire Beneficial Ownership of additional Voting Stock (other statutory than Common Stock received by a Purchaser upon conversion of any Notes) unless the Beneficial Ownership percentage of KKR and its Affiliates would, following such acquisition, be an amount below 1% of the Voting Stock then outstanding (not including any Common Stock received by a Purchaser upon conversion of any Notes)):
(i) a third party who is not an Affiliate of such Sponsor (a “Third Party”) acquires beneficial ownership of 50% of the outstanding Voting Stock; or
(ii) the Company enters into an agreement pursuant to which a Third Party would acquire all or regulatory provisions providing for stockholder access to books and records substantially all of the stock or assets of the Company or its Affiliates;the Company would be merged or consolidated with another Person, unless immediately following the consummation of such transaction the stockholders of the Company immediately prior to the consummation of such transaction would continue to hold (in substantially the same proportion as their ownership of the Company’s voting stock immediately prior to the transaction) more than 50% of all of the outstanding common stock or other securities entitled to vote for the election of directors of the surviving or resulting entity in such transaction or any direct or indirect parent thereof.
(ivc) engage Nothing in any “solicitation” clause (as such term is used ii) or clause (v) of Section 5.6(a) shall be construed to prohibit the Board Designee, in good faith and in the proxy rules performance of his or her duties as a member of the SECBoard of Directors, but includingor the Board Observer, notwithstanding anything to in each case, from confidentially discussing a proposal made by the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) Company or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of a Third Party concerning any extraordinary transaction involving the Company or any other matter successor thereto, any Subsidiary or division thereof, or any of their securities or assets, with the Board of Directors and representatives of the Company and its advisors who are involved in the evaluation or execution of any such proposal relating on behalf of the Company.
(d) Notwithstanding Section 5.6(a), upon an increase in the Beneficial Ownership percentage of a Sponsor and its Affiliates to an amount in excess of 1% of the Voting Stock outstanding (not including any Common Stock received by a Purchaser upon conversion of any Notes) resulting solely from a repurchase or redemption of Voting Stock by the Company or become any similar transaction that reduces the number of outstanding shares of Voting Stock of the Company, neither such Sponsor nor any of its Affiliates shall be required to dispose of any Securities Beneficially Owned by them; provided, however, that in such event, neither such Sponsor nor any of its Affiliates may acquire Beneficial Ownership of additional Voting Stock (other than Common Stock received by a “participant” Purchaser upon conversion of any Notes) unless the Beneficial Ownership percentage of such Sponsor and its Affiliates would, following such acquisition, be an amount below 1% of the Voting Stock then outstanding (as such term is defined in Instruction 3 to Item 4 not including any Common Stock received by a Purchaser upon conversion of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;Notes).
(ve) disclose to Each Sponsor agrees that, until the Standstill Termination Date, such Sponsor shall promptly notify the Company of any Third Partynew acquisition or disposition, either publicly or in a manner that would entry into any agreement or arrangement which could reasonably be expected to result in any new acquisition or require public disclosuredisposition, its voting of Beneficial Ownership of Voting Stock or consent intentions Securities by such Sponsor or any vote as of its Affiliates, including the material details thereof.
(f) Notwithstanding anything to any matter submitted to the contrary provided elsewhere herein, (i) Affiliates of a stockholder vote during Sponsor that are not engaged in the Cooperation Period private equity business (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would “Non-Investor Affiliates”) shall not be a violation considered “Affiliates” of such Sponsor for purposes of this provision)Section 5.6 if any actions taken by them are not taken under the direction of such Sponsor or any of its Affiliates (other than Non-Investor Affiliates) or any officer or general partner of such Sponsor or any of its Affiliates (other than Non-Investor Affiliates) and if Confidential Information is not made available to such Non-Investor Affiliates or their Representatives, except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
and (viii) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) none of the giving or withholding provisions of this Section 5.6 of this Agreement shall in any proxy relating toway limit the activities of G▇▇▇▇▇▇, or S▇▇▇▇ & Co. and its Affiliates (other authority to votethan the PIA Funds), any Voting Securities, or and (B) conducting G▇▇▇▇▇▇, Sachs & Co. and its Affiliates (other than the PIA Funds) may engage in any type of referendum relating to the Company (includingbrokerage, for the avoidance of doubtinvestment advisory, financial advisory, anti-raid advisory, merger advisory, financing, asset management, trading, market making, arbitrage, investment activity and other similar activities with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 1 contract
Sources: Note Purchase Agreement (Harman International Industries Inc /De/)
Standstill. During (a) Except as otherwise provided in this Agreement, from the Cooperation Period, each Live Party will not, and will cause its Affiliates and its Representatives acting on behalf date hereof until the earlier of (x) the fifth anniversary of the Live Parties date of the Purchase Agreement and (collectively with y) the Live Partiesdate the Total Ownership Amount is less than the Release Share Total (the "Standstill Period"), without the “Restricted Persons”) to notprior approval of a majority of the Non-Investor Directors, no Investor-Related Party shall, directly or indirectly, without the prior written consent, invitation, or authorization (i) acquire voting securities of the Company or that would result in the Board:
(i) make any public announcementInvestor Group Beneficially Owning, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A the aggregate, a percentage of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, Outstanding Shares in excess of the sum of (A) the Closing Ownership Percentage plus (B) 1% (excluding any proposal changes to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies ownership resulting solely as a result of the Company, including any change a reduction in the number of directors serving on shares of Common Stock outstanding due to the Board or repurchase of shares of Common Stock by the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
Company), (ii) seekmake, alone or in concert with one or more Third Partiessolicit, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter offer or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in a Change of Control or, if made by a Person other than an Investor-Related Party or require public disclosurea group of which an Investor-Related Party is a member, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing constitute a Third Party to implement Bid, (iii) engage in any "solicitation" of "proxies" (as such vote or consent terms are used in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted the proxy rules promulgated by the prior written consent of SEC under the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the BoardExchange Act), other than such encouragement or advice that for the benefit of the Investor Directors, if and to the extent the Investor Group is consistent with the Board’s recommendation in connection with such matterentitled to designate any Investor Directors hereunder, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, the other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation Director nominees of the Board;
, (ixiv) engage in any short sale or any purchase, sale, or grant become part of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security a "group" (other than any index fund, exchange-traded fund, benchmark fund or broad basket a group that includes only members of securitiesthe Investor Group) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing would be required to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;SEC disclosing an intention to change or influence the control of the Company, or (v) grant any proxies, transfer shares to any voting trust or enter into any voting agreement (other than (x) among the members of the Investor Group, (y) pursuant to this Agreement or (z) in respect of proxies voting in favor of a slate of Directors nominated by the Board). Notwithstanding the foregoing, any member of the Investor Group may propose, or engage in discussions with the Board regarding, (I) a possible Change of Control transaction involving the Investor Group or (II) a possible acquisition involving members of the Investor Group of the securities or assets of the Company or its subsidiaries, provided that such discussions are not, and shall not be, publicly disclosed by any member of the Investor Group or any other Investor-Related Party or any of their respective respresentatives and would not in the written opinion of counsel to the Company reasonably satisfactory to the Investor Group (it being agreed and acknowledged that Testa, Hurwitz & Thibeault, LLP is satisfactory counsel) be required ▇▇ ▇pp▇▇▇▇▇▇▇ la▇ ▇▇ ▇▇ ▇ublicly disclosed.
(xviib) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions Nothing in this Section 3(c3.01 shall (i) prohibit or restrict any member of the Investor Group from responding to any inquiries from any stockholders of the Company as to such Person's intention with respect to the voting of any Common Stock Beneficially Owned by such Person, (ii) restrict the right of each Investor Director on the Board or any committee thereof to vote on any matter as such individual believes appropriate or the manner in which an Investor Director may participate in his or her capacity as a director in deliberations or discussions at meetings of the Board or as a member of any committee thereof, (iii) prohibit any member of the Investor Group from acquiring securities of the Company issued by way of conversion, dividend, stock split or other distribution or exchange, recapitalization or reclassification or similar transaction in respect of securities which such member of the Investor Group is permitted to Beneficially Own under this Agreement, or (iv) except as provided in Section 2.04, restrict the ability of the members of the Investor Group from voting for or against or abstaining from any vote in connection with any Change in Control transaction or Third Party Bid, (v) prevent the members of the Investor Group from selling their Acquisition Shares or (vi) prohibit any member of the Investor Group from complying with applicable law.
(c) Each member of the Investor Group shall terminate automatically in be fully released from the event of a material breach provisions of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that Section 3.01 in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board fails to appoint Mr. LD as Chairman of the Board at any time that Mr. LD has the right to, and has exercised his right to, be so appointed by the Board in accordance with Section 2.07 and such appointment is not prohibited by the applicable listing or corporate governance standards of the NYSE or any director of the Companyapplicable law, rule or regulation, (ii) at any financial advisortime during the two-year period after the date hereof, legal counsel an Investor Director then serving on the Board dies, resigns (other than as required by Section 2.03) or other advisor is removed or disqualified and the Board fails to appoint to the Company or Board any Investor Director designated by the Investor Group to be so appointed by the Board in accordance with Section 2.01(c)(ii) as successor to such Investor Director and such appointment is not prohibited by the applicable listing or corporate governance standards of the NYSE or any applicable law, rule or regulation, or (iii) solely the Board fails to appoint Mr. LD to the extent directed Board as an Investor Director in accordance with Section 2.01(b) and maintain Mr. LD on the Board as an Investor Director in accordance with the applicable provisions of Sections 2.01 and 2.03 at any time during the three-year period after the date hereof (other than as a result of Mr. LD's death or permitted resignation or the prohibition, by the Board, any officer applicable listing or corporate governance standards of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives NYSE or any Third Party (at applicable law, rule or regulation, of Mr. LD's appointment to or continuation of service on the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the CompanyBoard as an Investor Director).
Appears in 1 contract
Sources: Purchase Agreement (Ionics Inc)
Standstill. During the Cooperation PeriodThe C▇▇▇▇▇▇▇▇ Parties each agree that, each Live Party will not, and will cause its Affiliates and its Representatives acting on behalf beginning as of the Live Parties date hereof and continuing for a period of two years from the date of this Agreement, (collectively with the Live Parties"Standstill Period"), they and their affiliates or associates (as defined in Rule 12b-2 promulgated pursuant to the “Restricted Persons”Securities Exchange Act of 1934, as amended (the "Exchange Act")) to notwill not (and they will not assist or encourage others to), directly or indirectly, in any manner, without the prior written consent, invitation, or authorization approval of the Company or the Board:
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect tomake, or otherwise solicit, seek, cause, offer or offer to effect, (A) in any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seekway participate in, alone or in concert with others, the removal any "solicitation" of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect "proxies" to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” vote (as such term is terms are used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Securities and Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” Commission promulgated pursuant to Rule 14a-2(b)(2) under Section 14 of the Exchange Act) of one or more proxies seek to advise or consents influence in any manner whatsoever any person with respect to the election or removal voting of one or more directors any voting securities of the Company or any other matter or proposal relating PVF, except pursuant to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 PVF's publication of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consentsits proxy statement;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(viiii) form, join, knowingly encourage join or knowingly in any way participate in or knowingly act in concert with any Group a "group" within the meaning of Section 13(d)(3) of the Exchange Act with respect to any Voting Securities, other than solely with Affiliates voting securities of the Live Parties with respect to Voting Securities now or hereafter owned by themPVF;
(viiiiii) enter into any voting trustacquire, arrangement offer to acquire or agreement agree to acquire, alone or in concert with respect to any Voting Securitiesothers, by purchase, exchange or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreementotherwise, (Ba) solely between or among any of the Live Parties assets, tangible and their Affiliatesintangible, of PVF or (Cb) granting direct or indirect rights, warrants or options to acquire any proxy in any solicitation approved by the Board and consistent with the recommendation assets of the BoardPVF;
(ixiv) engage otherwise act, alone or in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right concert with others (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from except in his expressing views as a decline in the market price or value of any director at meetings of the Company’s securities and would, in the aggregate board of directors or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates committee of the Live Parties;
(xi) instituteboard of directors of PVF or the Bank), solicit or join any litigation, arbitration or other proceeding against or involving the Company to seek to offer to PVF or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent stockholders any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganizationsimilar transaction to or with PVF or otherwise seek, files alone or in concert with others to control or change the management, Board or policies of PVF or nominate any person as a petition in bankruptcy under any provisions director of federal PVF or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to Bank who is not nominated by the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals tothen incumbent directors, or otherwise communicating withpropose any matter to be voted upon by the stockholders of PVF;
(v) make or cause to be made a proposal for consideration by the stockholders of PVF; or
(vi) announce an intention to do, or enter into any arrangement or understanding with others to do, any of the actions restricted or prohibited under clauses (i) the Board through (v) of this Section 2, or publicly announce or disclose any director of the Company, (ii) any financial advisor, legal counsel or other advisor request to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to be excused from any of the foregoing mattersobligations of this Section 2. At the 2008 PVF annual meeting of stockholders, so long the C▇▇▇▇▇▇▇▇ Parties agree to vote all the shares they collectively beneficially own, including shares owned by M▇. ▇▇▇▇▇▇▇▇▇'▇ wife or minor children, in favor of the nominees for election or reelection as any such communication is (x) not released publicly director of PVF selected by the Live Board and otherwise to support such director candidates. Thereafter, during the Standstill Period, the C▇▇▇▇▇▇▇▇ Parties or their Representatives agree to vote all shares of PVF they or any Third Party (at the direct of them beneficially own, including shares owned by M▇. ▇▇▇▇▇▇▇▇▇'▇ wife or indirect request minor children, in favor of the Live Parties) nominees for election or reelection as director of PVF selected by the Board and (y) not made in a manner that would require, or reasonably be expected agree otherwise to require, the Live Parties or the Company to make a public announcement regarding support such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companydirector candidates.
Appears in 1 contract
Standstill. During the Cooperation Period, each Live Party will not, and will cause its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to not, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by Without the prior written consent of Placement Agent, from the Company;
date hereof until forty five (vi45) knowingly encourage days after the Closing Date, neither the Company nor any subsidiary shall (i) issue, enter into any agreement to issue or advise any Third Party announce the issuance or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding proposed issuance of any proxy relating to, Ordinary Shares or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board)Ordinary Share Equivalents, other than such encouragement an Exempt Issuance or advice that is consistent with the Board’s recommendation in connection with such matter, (ii) file any registration statement or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage any amendment or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, supplement thereto other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter Prospectus Supplement. For purposes of this Agreement, “Exempt Issuance” means the issuance of (Da) exercising statutory appraisal rightsOrdinary Shares or options to employees, officers or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director directors of the Company pursuant to any share or nominee option plan duly adopted for director such purpose, by a majority of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any non-employee members of the terms Board of this Agreement (including this subclause), in each case publicly Directors or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that majority of the restrictions in this Section 3(c) shall terminate automatically in the event members of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination committee of non-proxy access director candidates employee directors established for election such purpose for services rendered to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (IIb) making any factual statement to comply with any subpoena securities upon the exercise or other legal process exchange of or respond to a request conversion of securities exercisable or exchangeable for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result convertible into Ordinary Shares issued and outstanding on the date of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); this Agreement, provided that such Restricted Person will notify securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities (other than in connection with stock splits or combinations) or to extend the term of such securities, (c) the securities of the Company promptly in writing issued pursuant to the Purchase Agreements and (unless prohibited d) securities issued pursuant to acquisitions or strategic transactions approved by law or contract) a majority of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities disinterested directors of the Company, provided that such securities are issued as “restricted securities” (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation as defined in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (xRule 144) and (y), with any Person other than a Live Party carry no registration rights that require or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to permit the filing of any bankruptcy petition under registration statement in connection therewith during the prohibition period in Section 14 herein and provided that any similar applicable law. Notwithstanding anything herein such issuance shall only be to a Person (or to the contraryequityholders of a Person) which is, nothing itself or through its subsidiaries, an operating company or an owner of an asset in this Agreement shall prohibit a business synergistic with the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director business of the Company, (ii) any financial advisor, legal counsel or other advisor Company and shall provide to the Company or the Board or (iii) solely additional benefits in addition to the extent directed or permitted by the Boardinvestment of funds, any officer of but shall not include a transaction in which the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives issuing securities primarily for the purpose of evaluatingraising capital or to an entity whose primary business is investing in securities. Please confirm that the foregoing correctly sets forth our agreement by signing and returning to the Placement Agents the enclosed copy of this Agreement. By: /s/ ▇▇▇▇ ▇▇▇▇▇ Name: ▇▇▇▇ ▇▇▇▇▇ Title: Authorized Representative Titan Partners Group LLC, negotiating a division of American Capital Partners, LLC ▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ New York, NY 10007 Attention: ▇▇▇▇ ▇▇▇▇▇ Email: **** Accepted and Agreed to as of the date first written above: By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Title: CEO & Chairman Address for notice: Gorilla Technology Group Inc. Meridien House ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Marble Arch ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Email: **** THIS PLACEMENT AGENT ORDINARY SHARE PURCHASE WARRANT (the “Warrant”) certifies that, for value received, _____________ or its assigns (the “Holder”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after the date hereof (the “Initial Exercise Date”) and on or prior to 5:00 p.m. (New York City time) on ____, 20301 (the “Termination Date”) but not thereafter, to subscribe for and purchase from Gorilla Technology Group Inc., a company organized under the laws of and consummating the Transaction or any transactions involving Cayman Islands (the “Company”), up to ______ Ordinary Shares (as subject to adjustment hereunder, the “Warrant Shares”). The purchase price of one Ordinary Share under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).
Appears in 1 contract
Sources: Placement Agency Agreement (Gorilla Technology Group Inc.)
Standstill. During the Cooperation PeriodThe Investors and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ Corporation each, each Live Party on behalf of themselves, hereby agree that they will not, and nor will cause its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notthey permit any Affiliate to, directly or indirectly, without (unless in any such case specifically approved in advance to do so by the prior written consentBoard of Directors, invitation, or authorization of the Company or the Board:
and (i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number case of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ Corporation, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation unless approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchaseGreenwood, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have in the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director case of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties Investors or any of their Affiliates, by a director not appointed by or affiliated in any way with the Investors) acquire, offer to acquire, or agree to acquire any Common Stock or other securities of the Company in an open-market transaction (“Company Securities”). Notwithstanding anything herein to Without limiting the contrarygenerality of the foregoing, the restrictions set forth in Section 3 following shall automatically terminate not be considered “open-market transactions” and be nothing contained herein shall prohibit any member of no further force and effect if the Investor Group or ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ or ▇▇▇▇▇▇▇ Corporation from acquiring any such Company Securities (i) upon conversion of the Notes, (ii) as a result of a stock split, stock dividend or similar recapitalization by the Company, (iii) pursuant to the exercise of any warrant, option or other right to acquire such securities that it receives directly from the Company enters into a definitive agreement with respect to a transaction involving (xincluding equity awards granted as compensation and approved by the Board of Directors), or (iv) in the sale or transfer of all or a controlling portion case of the Company’s equity securities Investor Group, pursuant to the preemptive rights provided in Section 4.6. In addition, nothing in this Section 4.5 shall preclude any Investor or all its Affiliates or a substantially all ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ or ▇▇▇▇▇▇▇ Corporation (a) from exercising the voting and other rights granted to the Investors pursuant to this Agreement or any of the Company’s assets Transaction Documents or (whether by b) in the case of any proposed merger, consolidationsale of assets or similar transaction that has been approved or recommended by the Board of Directors, business combination, or in the case of a tender or exchange offer made without encouragement by or the participation of the Investors or any of their Affiliates (if the Board of Directors shall send to stockholders a statement that the Board of Directors that (i) recommends approval of such tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete is neutral with respect to such tender or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents exchange offer) from making an offer to the filing Board of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contraryDirectors, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals torespect of such transaction, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor upon terms more favorable to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer its stockholders than those of the Company (who is not also a director)other transaction, with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companyproposed.
Appears in 1 contract
Sources: Investor Agreement (Riedman Corp)
Standstill. During the Cooperation PeriodStandstill Term, each Live Party will notneither the Investor nor any of its Affiliates (collectively, the “Standstill Parties”) shall (and will the Investor shall cause its Affiliates and its Representatives acting on behalf of not to), except as expressly approved or invited in writing by the Live Parties Company:
(collectively with the Live Parties, the “Restricted Persons”a) to not, directly or indirectly, without the prior written consent, invitationacquire beneficial ownership of Shares of Then Outstanding Common Stock and/or Common Stock Equivalents, or authorization make a tender, exchange or other offer to acquire Shares of Then Outstanding Common Stock and/or Common Stock Equivalents; provided, however, that notwithstanding the provisions of this Section 8.1(a), if the number of shares constituting Shares of Then Outstanding Common Stock is reduced or if the aggregate ownership of the Standstill Parties is increased as a result of a repurchase by the Company of Shares of Then Outstanding Common Stock, stock split, stock dividend or a recapitalization of the Board:Company, the Standstill Parties shall not be required to dispose of any of their holdings of Shares of Then Outstanding Common Stock even though such action resulted in the Standstill Parties’ beneficial ownership increasing;
(ib) make directly or indirectly, seek to have called any public announcementmeeting of the stockholders of the Company, propose or nominate for election to the Company’s Board of Directors any person whose nomination has not been approved by a majority of the Company’s Board of Directors or cause to be voted in favor of such person for election to the Company’s Board of Directors any Shares of Then Outstanding Common Stock;
(c) directly or indirectly, encourage or support a tender, exchange or other offer or proposal by any Third Party with respect to Shares of Then Outstanding Common Stock or Common Stock Equivalents; provided, however, that from and after the filing of a Schedule 14D-9 (or successor form of Tender Offer Solicitation/Recommendation Statement under Rule 14d-9 under the ▇▇▇▇ ▇▇▇) by the Company recommending that stockholders accept any such offer or proposal, Investor shall not be prohibited from taking any of the actions otherwise prohibited by this Section 8.1(c) only for so long as the Company maintains and does not withdraw such recommendation;
(including any “solicitation” of “proxies” d) directly or indirectly, solicit proxies or consents or become a participant in a solicitation (as such terms are defined or used in Regulation 14A under the ▇▇▇▇ ▇▇▇) in opposition to the recommendation of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies a majority of the Company, including any change in the number ’s Board of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign Directors with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating tomatter, or other authority seek to vote, advise or influence any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubtPerson, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreementvoting of any Shares of Then Outstanding Common Stock;
(viie) form, join, knowingly encourage deposit any Shares of Then Outstanding Common Stock in a voting trust or knowingly participate in or knowingly act in concert with subject any Group with respect Shares of Then Outstanding Common Stock to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any the voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Boardsuch Shares of Then Outstanding Common Stock;
(ixf) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to propose (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, purchase of the Company’s assets or businesses, or similar transaction involving the Company or (ii) any recapitalization, restructuring, saleliquidation or other extraordinary transaction with respect to the Company;
(g) act in concert with any Third Party to take any action in clauses (a) through (e) above, equity issuance or otherwiseform, join or in any way participate in a “partnership, limited partnership, syndicate, or other group” within the meaning of Section 13(d)(3) of the 1934 Act;
(h) enter into discussions, negotiations, arrangements or agreements with any Person relating to the foregoing actions referred to in (ya) through (e) above; provided, however, that (A) nothing in the foregoing clause (b) shall prohibit the Investor from proposing to the Company’s Nominating and Corporate Governance Committee (and not pursuant to the advance notice provisions set forth in the Company’s bylaws), in a confidential, nonpublic manner, potential director candidates for consideration by the Company’s Nominating and Corporate Governance Committee, which candidates the Investor believes would be in the best interest of the Company and its stockholders; and (B) nothing contained in this Section 8.1 prohibits the Investor or its Affiliates from acquiring a company or business that owns Shares of Then Outstanding Common Stock and/or Common Stock Equivalents provided that any such securities of the Company so acquired will be subject to the provisions of this Section 8.1; or
(i) request or propose to the Company’s Board of Directors (or any committee thereof), any member(s) thereof or any officer of the Company that the Company amend, waive, or consider the amendment or waiver of, any provisions set forth in this Section 8.1 (including this clause (i)); provided, however, that (A) nothing contained in this Section 8.1 shall prohibit the Investor from making proposals to the Company’s Chairman or Chief Executive Officer on a confidential, nonpublic basis for a proposed transaction between the parties of the type described in the foregoing clauses (a) and (f), so long as the Investor reasonably believes in good faith, based on the written advice of its outside counsel, that neither it nor the Company would reasonably be expected to be required by applicable Law or stock exchange requirement to disclose publicly any such proposal and (B) nothing in the foregoing clause (b) shall prohibit the Investor from proposing to the Company’s Nominating and Corporate Governance Committee (and not pursuant to the advance notice provisions set forth in the Company’s bylaws), on a confidential, non-public basis, potential director candidates for consideration by the Company’s Nominating and Corporate Governance Committee, which candidates the Investor believes would be in the best interest of the Company and its stockholders, so long as the Investor reasonably believes in good faith, based on the written advice of its outside counsel, that neither it nor the Company would reasonably be expected to be required by applicable Law or stock exchange requirement to disclose publicly any such proposal. None of (x) the issuance ownership nor purchase by an employee benefit plan of securities representing the Investor or convertible into the Investor’s Affiliates in any diversified index, mutual or exchangeable or exercisable forpension fund managed by an independent advisor, which fund in-turn holds, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director securities of the Company, (iiy) transfers or resales of the Shares by the Investor to any financial advisor, legal counsel or other advisor to the Company or the Board person in compliance with Section 7.5 or (iiiz) solely to the extent directed or permitted by the Board, any officer mere voting of the Company (who is not also Shares, will be deemed to be a director), with respect to any breach of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in Investor’s standstill obligations under this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the CompanySection 8.1.
Appears in 1 contract
Sources: Securities Purchase Agreement (Translate Bio, Inc.)
Standstill. During (a) Unless approved in advance in writing by at least two-thirds of the Cooperation Perioddirectors of the Board of Directors of Red Lion, each Live Party will notNavy agrees that neither it nor any of its controlled affiliates will, and that it will use its reasonable best efforts to cause its Affiliates directors and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notofficers not to, directly or indirectly, without except as otherwise provided in this Agreement, until the prior written consent, invitation, or authorization end of the Company or the BoardStandstill Period:
(i) make any public announcementacquire, proposal directly or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act))indirectly, written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling beneficial ownership of any vacancy on the Board or (B) any public proposal additional Red Lion Common Shares or other statement that is directly contrary equity securities of Red Lion, other than (i) by exercising any preemptive rights available to (Navy or may require the Company to waive) any of the terms of this Agreement;
its affiliates or (ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, as the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal result of any member of the Board or initiatestock split, encourage or participate in any “withhold” stock dividend, bonus issue, share subdivision, reverse stock split or similar campaign with respect to any meeting of stockholders;
transaction (iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SECprovided, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (includinghowever, for the avoidance of doubt, with respect to that notwithstanding the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts foregoing Navy and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any its controlled affiliates may purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate aggregate, a number of Red Lion Common Shares equal to the number they have sold from after Closing (as adjusted for any stock split, stock dividend, bonus issue, share subdivision, reverse stock split or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreementsimilar transaction); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations arrangements, understandings or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade finance or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with assist any other person that engages, or offers or proposes to engage, in connection with any of the actions prohibited by this Section 3(c);foregoing; or
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into arrangements, understandings or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding agreements (whether written or oral) with, or advise, finance or assist any other person in connection with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement foregoing; or
(including this subclause)iii) request, propose or otherwise seek, in each case publicly or in a manner that would reasonably be expected to give rise to a requirement to publicly announce require public disclosure, any amendment or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end waiver of the notice period); provided, further, that provisions contained in clauses (i)-(ii) above.
(b) Unless approved in advance in writing by at least two-thirds of the event that directors of the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”)Directors of Red Lion, then the restrictions and obligations set forth in Section 3 shall remain in effect until (Navy agrees that neither it nor any of its directors, officers or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or tradingcontrolled affiliates will, directly or indirectly, except as otherwise provided in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by until the Company or any end of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not Standstill Period:
(i) prohibit the Live Parties from privately identifying potential candidates seek, make or take any action to be nominated solicit or encourage any offer or proposal for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, amalgamation consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance sale or otherwise) purchase of assets or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolutionbusiness combination, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, transaction involving Red Lion;
(ii) “solicit” or become a “participant” in any financial advisor, legal counsel “solicitation” of any “proxy” (as such terms are defined in Regulation 14A under the Exchange Act) from any holder of Red Lion Common Shares in connection with any vote on any matter (whether or other advisor not relating to the Company election or the Board removal of directors), or agree or announce its intention to vote with any person undertaking a “solicitation”;
(iii) solely to the extent directed form or permitted by the Board, join in or in any officer way participate in a “group” as defined under Section 13(d)(3) of the Company (who is not also a director), Exchange Act or the rules promulgated thereunder with respect to any Red Lion Common Shares or other equity securities of Red Lion;
(iv) grant any proxies to any third party with respect to any Red Lion equity securities (other than as recommended by the Board of Directors of Red Lion) or deposit any Red Lion equity securities in a voting trust or enter into any other arrangement, understanding or agreement (whether written or oral) with a third party with respect to the voting thereof;
(v) seek, alone or in concert with other persons, additional representation on, or propose any changes to the size of, the board of directors of Red Lion;
(vi) enter into arrangements, understandings or agreements (whether written or oral) with, or advise, finance or assist any other person in connection with any of the foregoing mattersforegoing; or
(vii) request, so long as any such communication is (x) not released publicly by the Live Parties propose or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made otherwise seek, in each case in a manner that would requirerequire public disclosure, any amendment or reasonably be expected to require, waiver of the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing provisions contained in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companyclauses (i)-(vi) above.
Appears in 1 contract
Standstill. During Prior to the Cooperation PeriodTermination Date, each Live Party will except as otherwise provided in this Agreement (including Section 11(a)(i)), without the prior consent of the Board, Privet shall not, and will cause shall instruct its Affiliates and its Representatives acting on behalf not to, directly or indirectly (in each case, except as permitted by this Agreement):
(i) subject to Section 1(e), acquire, offer to acquire, agree to acquire or acquire rights to acquire (except by way of stock dividends or other distributions or offerings made available to holders of voting securities of the Live Parties (collectively with Company generally on a pro rata basis including, for the Live Partiesavoidance of doubt, the “Restricted Persons”) exercise of any subscription rights granted to notPrivet), directly or indirectly, without whether by purchase, tender or exchange offer, through the prior written consentacquisition of control of another person, invitationby joining a group, through swap or authorization hedging transactions or otherwise, any voting securities of the Company or any voting rights decoupled from the underlying voting securities which would result in the ownership or control of, or other beneficial ownership interest in, 10.0% or more than of the then-outstanding shares of the Common Stock in the aggregate (the “Ownership Cap”); provided, however, that the Board may increase the Ownership Cap by an affirmative vote of a majority of the Board:; or (ii) sell its shares of Common Stock other than in open market sale transactions where the identity of the purchaser is not known;
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer other than pursuant to effect, (ASection 1(i) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
, nominate, give notice of an intent to nominate or recommend for nomination a person for election at any Stockholder Meeting at which the Company’s directors are to be elected; (ii) seekknowingly initiate, alone encourage or participate in concert any solicitation of proxies in respect of any election contest or removal contest with one or more Third Parties, election or appointment torespect to the Company’s directors; (iii) submit any stockholder proposal for consideration at, or representation onbring any other business before, the Board any Stockholder Meeting; (iv) knowingly initiate, encourage or publicly nominate, indicate an intention to nominateparticipate in any solicitation of proxies in respect of any stockholder proposal for consideration at, or propose the nomination of, or recommend the nomination ofother business brought before, any candidate to the Board, seek, alone Stockholder Meeting; or in concert with others, the removal of any member of the Board or (v) knowingly initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholdersStockholder Meeting;
(iiic) make form, join or in any request for way knowingly participate in any group or agreement of any kind with respect to any voting securities of the Company in connection with any election or removal contest with respect to the Company’s directors or any stockholder list materials proposal or other business brought before any Stockholder Meeting (other than with Privet or one or more of its Affiliates and Associates that agree to be bound by the terms and conditions of this Agreement);
(d) deposit any voting securities of the Company in any voting trust or subject any Company voting securities to any arrangement or agreement with respect to the voting thereof (other than any such voting trust, arrangement or agreement solely among Privet and its Affiliates and otherwise in accordance with this Agreement);
(e) seek publicly, alone or in concert with others, to amend any provision of the Company’s charter or bylaws;
(f) demand an inspection of the Company’s books and records records;
(g) engage or continue to engage or use any private investigations firm or other person to investigate any of the Company’s directors, officers or employees or any of the Company’s Representatives;
(h) effect or seek to effect, offer or propose to effect, cause or participate in, or in any way assist or facilitate any other person to effect or seek, offer or propose (other than directly to the Board provided that such proposal does not require Privet to amend its Schedule 13D) to effect or participate in, any (i) material acquisition of any assets or businesses of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law subsidiaries; (ii) tender offer or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SECexchange offer, but includingmerger, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Actacquisition, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, share exchange or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of business combination involving any of the Company’s voting securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates any of the Live Parties;
(xi) institute, solicit material assets or join any litigation, arbitration or other proceeding against or involving businesses of the Company or any of its subsidiaries; or (iii) recapitalization, its current restructuring, liquidation, dissolution or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim material transaction with respect to any proceeding initiated by, or on behalf of, the Company or any of its Affiliates against subsidiaries or any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter material portion of this Agreement, (D) exercising statutory appraisal rights, its or (E) responding to or complying with validly issued legal processtheir businesses;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiiii) enter into any negotiations negotiations, agreements or agreements (whether written or oral) withunderstandings with any Third Party with respect to the foregoing, or advise, finance, assist, encourage or seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes respect to engage, in any of the actions prohibited by this Section 3(c)foregoing, or otherwise take or cause any action inconsistent with any of the foregoing;
(xivj) take publicly make or in any action way advance publicly any request or proposal that would reasonably be expected to (i) require any Live Party the Company or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) Board amend, modify or (ii) have the purpose or effect of circumventing waive any provision of this Agreement;; or
(xvk) enter into take any action challenging the validity or maintain any economic, compensatory enforceability of this Section 3 or pecuniary agreement, arrangement or understanding (written or oral) with any director of this Agreement unless the Company is challenging the validity or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms enforceability of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions Agreement. Nothing in this Section 3(c3 shall be deemed to (i) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given prohibit Privet or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than its Affiliates from communicating privately with the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”)directors, then the restrictions officers, shareholders and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, Representatives so long as such private communications would not be reasonably be expected determined, after consultation with outside counsel, to require trigger public disclosure of such communications, obligations for any party or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall would not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to circumvent any of the Live Parties’ Representatives effecting or recommending transactions in securities (xPrivet’s obligations under Sections 3(a) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (ythrough 3(k) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Companyhereof, (ii) impose any financial advisor, legal counsel restriction on a Privet Designee discharging her or other advisor to his fiduciary duties as a director of the Company or the Board or (iii) solely to prohibit Privet from making any disclosure required by rule, law, regulation or legal process or as requested by regulatory or judicial authority provided that (A) any such disclosures by Privet or its Affiliates complies with all existing confidentiality obligations of Privet and the extent directed or permitted by the Board, any officer of the Company (who is not also a director), Privet Designee with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) Company and (yB) this clause (iii) would not made in a manner that would require, or reasonably be expected used to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companycircumvent Privet’s obligations under Sections 3(a) through 3(k) hereof.
Appears in 1 contract
Sources: Settlement Agreement (Potbelly Corp)
Standstill. During 1. Abgenix agrees that for a period of [_________] from the Cooperation Perioddate hereof, each Live Party Abgenix will not, nor will it permit any of its affiliates or associates to, from and will cause its Affiliates and its Representatives acting on behalf after the date that such person becomes an affiliate or associate, unless in any such case specifically invited to do so by the Board of Directors of ImmunoGen (1) acquire, announce an intention to acquire, offer or propose to acquire, solicit an offer to sell or agree to acquire by purchase, by gift, by joining a partnership, limited partnership, syndicate or other "group," as such term is used in Section 13(d)(3) of the Live Parties Exchange Act (collectively with the Live Partiessuch term to have such meaning throughout this Section D) or otherwise, the “Restricted Persons”) to not, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
any (i) make material assets, businesses or properties of ImmunoGen other than in the ordinary course of business, or (ii) shares of ImmunoGen common stock, or any public announcementother ImmunoGen securities convertible into, proposal exchangeable for or offer exercisable for ImmunoGen common stock (including all such securities, collectively, "Voting Securities"), except that the foregoing shall not apply to the purchase of the Shares pursuant to this Letter Agreement, (2) solicit, or participate in any “"solicitation” " of “"proxies” " or become a "participant" in any "election contest" (as such terms are defined or used in Regulation 14A of under the Exchange Act)), written consents these terms to have such meaning throughout this Agreement) with respect toto ImmunoGen, (3) initiate, publicly propose or otherwise solicit stockholders for the approval of, one or more stockholder proposals with respect to ImmunoGen, or otherwise solicit, seek, cause, offer or offer induce any other person to effectinitiate any stockholder proposal, (A4) seek to place any proposal to seek representation representative on the Board of Directors of ImmunoGen, or otherwise seek to control or influence the management, the Board or the policies have called any meeting of the Company, including stockholders of ImmunoGen; (5) deposit any change Voting Securities in the number of directors serving on the Board a voting trust or the filling of any vacancy on the Board or (B) any public proposal subject them to a voting agreement or other statement that is directly contrary agreement or arrangement with respect to (or may require the Company to waive) any voting of the terms of such Voting Securities, other than this Agreement;
, (ii6) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seekotherwise act, alone or in concert with others, to seek to control the removal management, Board of Directors, policies or affairs of ImmunoGen or solicit, publicly propose, seek to effect or negotiate with any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign other person with respect to any meeting form of stockholders;
(iii) make any request for stockholder list materials business combination or other books and records of the Company extraordinary transaction with ImmunoGen or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), transaction with respect to any ImmunoGen, or solicit, make or publicly Portions of this Exhibit were omitted and have been filed separately with the Secretary of the foregoing matters, so long as any such communication is (x) not released publicly by Commission pursuant to the Live Parties or their Representatives or any Third Party (at the direct or indirect request Company's application requesting confidential treatment under Rule 24b-2 of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance Securities Exchange Act of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company1934.
Appears in 1 contract
Standstill. During (a) JCP agrees that, from the Cooperation Perioddate of this Agreement until the expiration of the Standstill Period (as defined below), each Live Party will notneither it nor any of its Affiliates or Associates will, and it will cause each of its Affiliates and its Representatives acting on behalf of the Live Parties Associates (collectively with the Live Parties, the “Restricted Persons”as defined below) to notnot to, directly or indirectly, without the prior written consentin any manner, invitation, acting alone or authorization of the Company or the Boardin concert with others:
(i) make submit any public announcementstockholder proposal (pursuant to Rule 14a-8 promulgated by the Securities and Exchange Commission (the “SEC”) under the Securities Exchange Act of 1934, proposal as amended (the “Exchange Act”) or offer otherwise) or any notice of nomination or other business for consideration, or nominate any candidate for election to the Board (including any “solicitation” by way of “proxies” (as such terms are defined or used in Rule 14a-11 of Regulation 14A of the Exchange Act)14A), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of than as expressly permitted by this Agreement;
(ii) seekengage in, alone directly or in concert with one or more Third Partiesindirectly, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary defined in Rule 14a-2 under the Exchange Act, solicitations 14a-1 of ten Regulation 14A) of proxies (10or written consents) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participantparticipant in a solicitation” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A of Regulation 14A under the Exchange Act) in opposition to the recommendation or proposal of the Board, or recommend or request or induce or attempt to induce any other person to take any such solicitation actions, or seek to advise, encourage or influence any other person with respect to the voting of the Common Stock (including any withholding from voting) or grant a proxy with respect to the voting of the Common Stock or other voting securities to any person other than to the Board or persons appointed as proxies or consentsby the Board;
(viii) disclose seek to call, or to request the call of, a special meeting of the Company’s stockholders, or make a request for a list of the Company’s stockholders or for any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent books and records of the Company;
(viiv) knowingly encourage form, join in or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating toway participate in a “partnership, limited partnership, syndicate or other authority to vote, any Voting Securities, or (Bgroup” within the meaning of Section 13(d)(3) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, Exchange Act with respect to the Company’s management Common Stock or the Board)deposit any shares of Common Stock in a voting trust or similar arrangement or subject any shares of Common Stock to any voting agreement or pooling arrangement, other than to the extent such encouragement or advice that is consistent a group may be deemed to result with the Board’s recommendation in connection with such matter, Company or any of its Affiliates or Associates as otherwise expressly permitted by a result of this Agreement;
(viiv) form, join, knowingly encourage vote for any nominee or knowingly participate in or knowingly act in concert with any Group with respect nominees for election to any Voting Securitiesthe Board, other than solely with Affiliates of those nominated or supported by the Live Parties with respect to Voting Securities now or hereafter owned by themBoard;
(viiivi) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts except as specifically provided in Section 1 and the like), in each case other than (A) Section 2 of this Agreement, (B) solely between seek to place a representative or among the Live Parties and their Affiliatesother Affiliate, Associate or (C) granting any proxy in any solicitation approved by nominee on the Board and consistent with or seek the recommendation removal of any member of the Board or a change in the size or composition of the Board;
(ixvii) engage in any short sale acquire or any purchaseagree, saleoffer, seek or propose to acquire, or grant of any optioncause to be acquired, warrant, convertible security, share appreciation right, or other similar right ownership (including any put or call option or “swap” transactionbeneficial ownership) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate assets or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates business of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current rights or former directors options to acquire any such assets or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent business from any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal processperson;
(xiiviii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any than at the direction of the actions set forth Board or any committee thereof and except in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
connection with an Opposition Matter (xiii) enter into any negotiations or agreements (whether written or oral) withas defined below), or adviseseek, financepropose, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c)with respect to, or make any investment in or enter into any agreement with any other person that engagessolicit, negotiate with, or offers or proposes provide any information to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), person with respect to an Extraordinary Transaction between the Live Parties and the Companyto, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, acquisition of control or other business combination, tender or exchange offer, purchase, sale or transfer of assets or securities, dissolution, liquidation, reorganization, change in structure or composition of the Board, change in the executive officers of the Company, change in capital structure, recapitalization, restructuringdividend, saleshare repurchase or similar transaction involving the Company, equity issuance its subsidiaries or otherwiseits business, whether or not any such transaction involves a change of control of the Company;
(ix) acquire, announce an intention to acquire, offer or (y) the issuance of securities representing propose to acquire, or convertible into or exchangeable or exercisable foragree to acquire, directly or indirectly, more than 25by purchase or otherwise, beneficial ownership of any (A) interests in any of the Company’s indebtedness or (B) Common Stock of the Company representing in the aggregate (amongst JCP and its Affiliates and Associates) in excess of 9.9% of the Company’s outstanding Common Stock; provided, however, nothing herein shall prevent JCP from confidentially seeking a waiver to acquire in excess of 9.9% of the case of each of clause Company’s outstanding Common Stock;
(x) and disclose publicly, or privately in a manner that could reasonably be expected to become public, any intention, plan or arrangement inconsistent with the foregoing;
(y), with xi) take any Person other than a Live Party action challenging the validity or an Affiliate enforceability of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal this Section 3; or
(xii) enter into any agreement, arrangement or state bankruptcy law understanding concerning any of the foregoing (other than this Agreement) or consents encourage or solicit any person to undertake any of the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing foregoing activities.
(b) As used in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, Agreement:
(i) the Board or any director of terms “Affiliate” and “Associate” shall have the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted respective meanings set forth in Rule 12b-2 promulgated by the BoardSEC under the Securities Exchange Act of 1934, any officer of as amended (the Company (who is not also a director“Exchange Act”), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.;
Appears in 1 contract
Sources: Settlement Agreement (Jamba, Inc.)
Standstill. During The ▇▇▇▇▇▇▇ Group agrees that, for the Cooperation period commencing on the date of this Agreement and ending on the earlier of (i) the 30th calendar day preceding the opening of the nomination window for submission of director nominees at the Company’s 2016 Annual Meeting and (ii) a material breach by the Company of its obligations under this Agreement which is not cured within 5 business days after written notice from the ▇▇▇▇▇▇▇ Group (the "Standstill Period"), each Live Party will notneither it nor any of its Affiliates will, and it will cause each of its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notnot to, directly or indirectly, without the prior written consentin any manner other than pursuant to Section 6(c), invitation, acting alone or authorization of the Company or the Boardin concert with others:
(i) make submit any public announcementstockholder proposal (pursuant to Rule 14a-8 promulgated by the Securities and Exchange Commission (the "SEC") under the Exchange Act or otherwise) or any notice of nomination or other business for consideration, proposal or offer nominate any candidate for election to the Board (including any “solicitation” by way of “proxies” (as such terms are defined or used in Rule 14a-11 of Regulation 14A of the Exchange Act)14A), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of than as expressly permitted by this Agreement;
(ii) seekengage in, alone directly or indirectly, any "solicitation" (as defined in concert with one Rule 14a-1 of Regulation 14A) of proxies (or more Third Parties, election written consents) or appointment tootherwise become a "participant in a solicitation" (as such term is defined in Instruction 3 of Schedule 14A of Regulation 14A under the Exchange Act) in opposition to the recommendation or proposal of the Board, or representation onrecommend or request or induce or attempt to induce any other person to take any such actions, or seek to advise, encourage or influence any other person with respect to the voting of the Common Stock (including any withholding from voting) or grant a proxy with respect to the voting of the Common Stock or other voting securities to any person other than to the Board or publicly nominate, indicate an intention persons appointed as proxies by the Board;
(iii) seek to nominatecall, or propose to request the nomination call of, a special meeting of the Company’s stockholders, or recommend make a request for a list of the nomination ofCompany’s stockholders or for any books and records of the Company;
(iv) form, join in or in any candidate other way participate in a "partnership, limited partnership, syndicate or other group" within the meaning of Section 13(d)(3) of the Exchange Act with respect to the Common Stock or deposit any shares of Common Stock in a voting trust or similar arrangement or subject any shares of Common Stock to any voting agreement or pooling arrangement, other than a group consisting only of some or all of the Investors and their Affiliates;
(v) vote for any nominee or nominees for election to the Board, seekother than those nominated or supported by the Board;
(vi) except as specifically provided in Section 1 and Section 2 of this Agreement, alone seek to place a representative or in concert with others, other Affiliate or nominee on the Board or seek the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used a change in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) size or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation composition of the Board;
(ixvii) engage in any short sale acquire or any purchaseagree, saleoffer, seek or propose to acquire, or grant of any optioncause to be acquired, warrant, convertible security, share appreciation right, or other similar right ownership (including any put or call option or “swap” transactionbeneficial ownership) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate assets or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates business of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any rights or options to acquire any such assets or business from any person;
(viii) other than at the direction of its subsidiariesthe Board, its current seek, propose, or former directors or its officers (including derivative actions), each in their capacity as such make any statement (other than to enforce rights under this Agreementone or more members of the Board or management or its advisors or agents (including, without limitation, any firm engaged by the CDC); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated byto, or on behalf ofsolicit, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) negotiate with, or advise, finance, assist, seek provide any information to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Companyto, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, acquisition of control or other business combination, tender or exchange offer, purchase, sale or transfer of assets or securities, dissolution, liquidation, reorganization, change in structure or composition of the Board, change in the executive officers of the Company, change in capital structure, recapitalization, restructuringdividend, saleshare repurchase or similar transaction involving the Company, equity issuance its subsidiaries or otherwiseits business, whether or not any such transaction involves a change of control of the Company;
(ix) acquire, announce an intention to acquire, offer or (y) the issuance of securities representing propose to acquire, or convertible into or exchangeable or exercisable foragree to acquire, directly or indirectly, more than 25by purchase or otherwise, beneficial ownership of any (A) interests in any of the Company’s indebtedness or (B) Common Stock of the Company representing in the aggregate (amongst the ▇▇▇▇▇▇▇ Group and its Affiliates) in excess of 9.9% of the Company’s outstanding Common Stock; provided, however, nothing herein shall prevent the ▇▇▇▇▇▇▇ Group from confidentially seeking a waiver to acquire in excess of 9.9% of the case of each of clause Company’s outstanding Common Stock;
(x) and disclose publicly, or privately in a manner that could reasonably be expected to become public, any intention, plan or arrangement inconsistent with the foregoing;
(y), with xi) take any Person other than a Live Party action challenging the validity or an Affiliate enforceability of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal this Section 3; or
(xii) enter into any agreement, arrangement or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to understanding concerning any of the foregoing matters, so long as (other than this Agreement) or encourage or solicit any such communication is (x) not released publicly by the Live Parties or their Representatives or person to undertake any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companyforegoing activities.
Appears in 1 contract
Sources: Settlement Agreement (Sandell Asset Management Corp)
Standstill. During the Cooperation Period, each Live Party will not, and will cause its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to not, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by Without the prior written consent of Placement Agent, from the Company;
date hereof until thirty (vi30) knowingly encourage days after the Placement Securities are registered, neither the Company nor any subsidiary shall (i) issue, enter into any agreement to issue or advise any Third Party announce the issuance or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding proposed issuance of any proxy relating to, Ordinary Shares or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board)Ordinary Shares equivalents, other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, an Exempt Issuance or (Cii) granting file any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale registration statement or any purchase, sale, amendment or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter supplement thereto. For purposes of this Agreement, “Exempt Issuance” means the issuance of (Da) exercising statutory appraisal rightsshares of Ordinary Shares or options to employees, officers or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director directors of the Company pursuant to any share or nominee option plan duly adopted for director such purpose, by a majority of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any non-employee members of the terms Board of this Agreement (including this subclause), in each case publicly Directors or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that majority of the restrictions in this Section 3(c) shall terminate automatically in the event members of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination committee of non-proxy access director candidates employee directors established for election such purpose for services rendered to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (IIb) making any factual statement to comply with any subpoena securities upon the exercise or other legal process exchange of or respond to a request conversion of securities exercisable or exchangeable for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result convertible into Ordinary Shares issued and outstanding on the date of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); this Agreement, provided that such Restricted Person will notify securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities (other than in connection with stock splits or combinations) or to extend the term of such securities, (c) the securities of the Company promptly in writing issued pursuant to the Purchase Agreements and (unless prohibited d) securities issued pursuant to acquisitions or strategic transactions approved by law or contract) a majority of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities disinterested directors of the Company, provided that such securities are issued as “restricted securities” (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation as defined in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (xRule 144) and (y), with any Person other than a Live Party carry no registration rights that require or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to permit the filing of any bankruptcy petition under registration statement in connection therewith during the prohibition period in Section 14 herein and provided that any similar applicable law. Notwithstanding anything herein such issuance shall only be to a Person (or to the contraryequity holders of a Person) which is, nothing itself or through its subsidiaries, an operating company or an owner of an asset in this Agreement shall prohibit a business synergistic with the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director business of the Company, (ii) any financial advisor, legal counsel or other advisor Company and shall provide to the Company or the Board or (iii) solely additional benefits in addition to the extent directed or permitted by the Boardinvestment of funds, any officer of but shall not include a transaction in which the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives issuing securities primarily for the purpose of evaluating, negotiating raising capital or to an entity whose primary business is investing in securities. Please confirm that the terms foregoing correctly sets forth our agreement by signing and returning to the Placement Agents the enclosed copy of and consummating the Transaction or any transactions involving the Company.this Agreement. By: Name: Title:
Appears in 1 contract
Standstill. During From and after the Cooperation PeriodClosing and until the date on which Parent, Member and their Affiliates, in the aggregate, no longer are the Beneficial Owners of more than 1% of the outstanding Voting Securities, unless an exemption or waiver is otherwise approved by the Board of Directors, each Live Party will of Parent and Member shall not, and will shall cause its their Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notnot to, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(ia) make nominate, give notice of an intent to nominate, or recommend for nomination a person for election to the Board of Directors at any public announcementmeeting of Acquiror’s stockholders at which directors are to be elected;
(b) solicit proxies in respect of any election contest with respect to the Company’s directors;
(c) initiate, proposal encourage or offer (including participate in any “solicitation” of “proxies” (as such terms are defined under Regulation 14A under Exchange Act) or used consents relating to the election of directors with respect to Acquiror, become a “participant” (as such term is defined in Regulation 14A of under the Exchange Act))) in any solicitation seeking to elect directors not nominated by the Board of Directors, written consents or publicly announce an intention to vote with any Person undertaking a “solicitation”, or seek to advise or influence any Person or 13D Group with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) the voting of any proposal to seek representation on Voting Securities in favor of election of directors not nominated by the Board of Directors;
(d) deposit any Voting Securities in any voting trust or otherwise seek similar arrangement that would prevent or materially interfere with Parent or Member’s right or ability to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of satisfy its obligations under this Agreement;
(e) submit any matter to (or propose any matter for submission to) a vote of stockholders of Acquiror (pursuant to Rule 14a-8 under the Exchange Act or otherwise) or bring any other business before a meeting of the stockholders of Acquiror;
(f) initiate, encourage or participate in any solicitation of proxies in respect of any stockholder proposal for consideration at, or bring any other business before, any meeting of the Company’s stockholders; grant any proxies with respect to Voting Securities to any Person (other than to (i) an officer or other representative of Member or Parent, or (ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention a designated representative of Acquiror pursuant to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal a proxy statement of any member of the Board or Acquiror);
(g) initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholdersthe stockholders of Acquiror or any solicitation of written consents of the stockholders of Acquiror;
(iiih) make request, or initiate, encourage or participate in, any request for stockholder list materials or other books and records to call a special meeting of the Company or any stockholders of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its AffiliatesAcquiror;
(ivi) engage seek, alone or in concert with others, to amend any “solicitation” (as such term is used in the proxy rules provision of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations Acquiror’s certificate of ten (10) incorporation or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consentsbylaws;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(viij) form, join, knowingly encourage the formation of or knowingly engage in discussions relating to the formation of, or participate in or knowingly act in concert with any a 13D Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viiik) enter into take any voting trustaction, arrangement alone or agreement in concert with respect to any Voting Securitiesothers, or subject make any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation public statement not approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and wouldDirectors, in each case, seeking to control or influence the aggregate management or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates policies of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company Acquiror or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such Subsidiaries (other than to enforce rights under this Agreement); providedconsultations with, howevernotifications to, that for the avoidance of doubtor other communications with, the foregoing shall management of Acquiror in the ordinary course of business regarding business relationships between Parent or its Affiliates and Acquiror and its Affiliates) and not prevent relating to the ownership or control of Acquiror;
(l) offer or propose to acquire or agree to acquire (or request permission to do so), whether by joining or participating in a 13D Group or otherwise, Beneficial Ownership of Voting Securities in excess of the Cap;
(m) enter into discussions, negotiations, arrangements or understandings advise, assist or encourage any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim Person with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by Section 3.1 or this Section 3(c)3.2;
(xivn) take enter into any action that transaction the effect of which would reasonably be expected to “short” any securities of Acquiror;
(io) require any Live Party publicly seek or the Company publicly request permission to make a public announcement regarding do any of the actions set forth in this Section 3(c) foregoing, publicly request to amend or (ii) have the purpose or effect of circumventing waive any provision of this AgreementSection 3.2 (including this clause (n)), or publicly make any public announcement with respect to any of the foregoing;
(xvp) advise, assist or encourage any third party to do any of the foregoing;
(q) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal respect to amend or waive any of the terms foregoing; or
(r) contest the validity or enforceability of this Agreement (including this subclause), the agreements contained in each case publicly Section 3.1 or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c3.2. provided, however, this Section 3.2 shall not prevent (i) shall terminate automatically in the event Member, Parent or any of a material their Affiliates from voting as stockholders of Acquiror so long as there is no breach of this Agreement Section 3.2, (ii) Parent or Member from taking any other actions expressly permitted by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing (iii) Member, Parent or any of their Affiliates from selling Acquiror Common Stock in this Agreement (including the restrictions in this Section 3(c)) will prohibit connection with a tender or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing exchange offer for or taking other actions (subject to the terms at least 50.1% of the Confidentiality Agreement Acquiror Common Stock commenced by a third party (as defined herein))and not involving any breach by Parent or Member of Section 3.2) which tender or exchange offer, with respect to an Extraordinary Transaction between the Live Parties and the Companyif consummated, would constitute a change of control of Acquiror or (IIiv) making any factual statement to comply with any subpoena or other legal process or respond Parent, through a senior executive officer, from confidentially communicating to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as senior executive officer of Acquiror a result non-public proposal regarding the purchase of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, additional securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation Acquiror in investor meetings or conferences) regarding any matter, (VI) privately requesting such a waiver of any provision of this Agreement, manner as long as such private communications or requests would not reasonably be expected to require public disclosure (including by requiring a filing with the Securities Exchange Commission, Department of such communications Justice or requests Federal Trade Commission) by the Company either party. Member and Parent hereby confirm that there are no arrangements or any understandings to which it is a party concerning stock of the Restricted PersonsAcquiror, (VII) subject except agreements to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all which Acquiror or a controlling portion of the Company’s equity securities or all or subsidiary is a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companyparty.
Appears in 1 contract
Sources: Stockholders Agreement (Sunnova Energy International Inc.)
Standstill. During the Cooperation Period, each Live Party Azurite will not, and will cause its controlling and controlled Affiliates and its and their respective Representatives acting on its behalf of the Live Parties (collectively with the Live PartiesAzurite, the “Restricted Persons”) to not, directly or indirectly, without the prior written consent, invitation, or authorization of or by the Company or the Board, in each case, in writing:
(i) offer to acquire, agree to acquire or acquire rights to acquire (except by way of stock dividends or other distributions or offerings made available to holders of Common Shares generally on a pro rata basis), directly or indirectly, whether by purchase, tender or exchange offer, through the acquisition of control of another person, by joining a “group” (within the meaning of Section 13(d)(3) of the Exchange Act), through swap or hedging transactions or otherwise, any voting securities of the Company (other than through a broad-based market basket or index) or any voting rights decoupled from the underlying voting securities which would result in the ownership or control of, or other beneficial ownership interest in excess of 19.9% of the then-outstanding Common Shares (the “Ownership Threshold”), provided that if Azurite commences a tender offer for Common Shares, at a price equal to or higher than the 10-Day VWAP immediately before the commencement date, which if consummated, would result in Azurite holding no more than the Ownership Threshold, the Company shall not make any public announcement, proposal whether by filing a Schedule 14D-9 (or offer (including any “solicitation” of “proxies” (as amendment thereto) or otherwise, recommending that the Company’s stockholders reject such terms are defined or used in Regulation 14A of tender offer, subject to the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies fiduciary duties of the Company, including any change in ’s directors under the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this AgreementOGCL;
(ii) (A) call or seek to call (publicly or otherwise), alone or in concert with others, a meeting of the Company’s shareholders (or the setting of a record date therefor), (B) seek, alone or in concert with one or more Third Partiesothers, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, nominate 4 or propose the nomination of, or recommend the nomination of, any candidate to the Board, except as expressly set forth in Section 1, (C) seek, alone or in concert with othersothers (including through any “withhold” or similar campaign), the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting (D) conduct a referendum of stockholdersshareholders of the Company;
(iii) make any a request for stockholder any shareholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 subsidiaries;
(iv) make any public proposal, public announcement or public request with respect to, (A) any change in the number, terms or identity of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records directors of the Company or its Affiliatesthe filling of any vacancies on the Board other than as provided under Section 1 of this Agreement, (B) any change in the business, capitalization, capital allocation policy or dividend policy of the Company or sale, spinoff, splitoff or other similar separation of one or more business units, (C) any other change to the Board or the Company’s management or corporate or governance structure, (D) any waiver, amendment or modification to the Organizational Documents, (E) causing the Common Shares to be delisted from, or to cease to be authorized to be quoted on, any securities exchange, or (F) causing the Common Shares to become eligible for termination of registration pursuant to Section 12(g)(4) of the Exchange Act;
(ivv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 promulgated under the Exchange Act, solicitations of ten Act (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Actas defined below)) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A promulgated under the Exchange Act) in any such solicitation of proxies or consentsproxies;
(vvi) disclose make or submit to the Company or any Third Partyof its Affiliates any proposal for, or offer of (with or without conditions), either alone or in concert with others, any tender offer, exchange offer, merger, consolidation, acquisition, sale of all or substantially all assets or sale, spinoff, splitoff or other similar separation of one or more business units, business combination, recapitalization, restructuring, liquidation, dissolution or similar extraordinary transaction involving the Company (including its subsidiaries and joint ventures or any of their respective securities or assets) (each, an “Extraordinary Transaction”) either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions disclosure by the Company or any vote as to any matter submitted to a stockholder vote during of the Cooperation Period Restricted Persons (it being understood that instructing a Third Party to implement the foregoing shall not restrict the Restricted Persons from tendering shares, receiving payment for shares or otherwise participating in any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by Extraordinary Transaction on the prior written consent same basis as other shareholders of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage join or knowingly participate in or knowingly act in concert with any Group “group” as defined in Section 13(d)(3) of the Exchange Act, with respect to any Voting Securities, other than solely with Affiliates of the Live Parties Azurite with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any a voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, Agreement (B) solely between or among the Live Parties and their Affiliates, with Affiliates of Azurite or (C) granting any proxy proxies in any solicitation solicitations approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-exchange traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities of the Company and would, in the aggregate or individually, result in the Live Parties Azurite ceasing to have a Net Long Position “net long position” in the Company equivalent to its percentage beneficial ownership of the voting power of the then issued and outstanding Common Shares of the Company;
(x) sell, offer offer, or agree to sell, all or substantially all, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock Shares held by a Live Party or Affiliates of the Live PartiesRestricted Person to any Third Party;
(xi) institute, solicit or join as a party any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, subsidiaries or any of its or their respective current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party Restricted Person from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 1110, (B) making any counterclaim counterclaims with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Partya Restricted Person, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, rights or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations negotiations, agreements, arrangements, or agreements understandings (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, with any Third Party to take any action or make any statement that the Restricted Persons are prohibited by from taking pursuant to this Section 3(c2(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);; or
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xviixiii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that which would reasonably be expected to give rise to result in a requirement to publicly announce public announcement or disclose disclosure of such request or proposal; provided provided, that the restrictions in this Section 3(c2(c) shall terminate automatically in upon the event earliest of the following: (i) the delivery of notice by Azurite at any time after the one year anniversary date of this Agreement, that the New Directors have resigned from the Board and all of their other respective positions with the Company and that Azurite is terminating the Cooperation Period (a “Cooperation Period Termination”), (ii) any material breach of Sections 1(a), (b), (c), (d) (other than the third sentence of clause (d)) or (i) of this Agreement by the Company (including, without limitation, a failure to appoint the New Directors to the Board and, with respect to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, to the Audit Committee, in accordance with Section 1) upon ten (10) business days’ written notice by Azurite to the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written such notice to the Company of such material breach (period, provided that the Live Parties are Azurite is not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a(iii) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting entry into (x) a definitive written agreement with respect to any Extraordinary Transaction that, if consummated, would result in the acquisition by any person or group of stockholders more than 50% of the Voting Securities or assets having an aggregate value exceeding 50% of the aggregate enterprise value of the Company or (y) one or more definitive written agreements providing for a transaction or series of related transactions which would in the “2026 Annual Meeting”), then aggregate result in the restrictions and obligations set forth in Section 3 shall remain in effect until Company issuing to one or more Third Parties at least 19.9% of the Common Shares (including on an as-converted basis) outstanding immediately prior to such issuance(s) during the Cooperation Period (provided that securities issued as consideration for (or be reinstated and be applicable untilin connection with) the date acquisition of the assets, securities and/or business(es) of another person by the Company or one or more of its subsidiaries or upon exercise or conversion of currently outstanding options or convertible securities of the Company shall not be counted toward this clause (y)); (iv) the commencement of any tender or exchange offer (by any person or group other than Azurite or their Affiliates) which, if consummated, would constitute an Extraordinary Transaction that is thirty would result in the acquisition by any person or group of more than 50% of the Voting Securities, where the Company files with the SEC a Schedule 14D-9 (30or amendment thereto) calendar days prior that does not recommend that its shareholders reject such tender or exchange offer (it being understood that nothing herein will prevent the Company from issuing a “stop, look and listen” communication pursuant to Rule 14d-9(f) promulgated under the Exchange Act in response to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination commencement of non-proxy access director candidates for election to the Board at the 2026 Annual Meetingany tender or exchange offer). Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including but not limited to the restrictions in this Section 3(c2(c)) will prohibit or restrict any of the Restricted Person Persons from (IA) making any public or private proposal, negotiating, seeking financing for statement or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), announcement with respect to an any Extraordinary Transaction between that is publicly announced by the Live Parties and the CompanyCompany or a Third Party, (IIB) making (after consultation with the Company to the extent legally permitted and practicable) any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person person from whom information is sought (so long as such process or request did not arise as a result of any discretionary act acts by any Restricted Person intending to cause or otherwise provoke such process or requestPerson); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (IIIC) granting any lien liens or encumbrance encumbrances on any claim claims or interest interests in favor of a bank or broker-dealer or prime broker holding such claim claims or interest interests in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim claims or interest interests in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IVD) negotiating, evaluating or investing and/or trading, directly or indirectly, in any index fund, exchange-exchange traded fund, benchmark fund or broad basket of securities that which may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, Company or (VE) providing its views privately to the Chairman of the Board, Board or the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) Officer regarding any matter, (VI) or privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 1 contract
Standstill. During The Investor Parties agree that until the Cooperation Period, each Live Party will not, later of (i) 90 days after the first day on which no Investor Designee serves on the Board and will cause the Investor has no rights (or has irrevocably waived its Affiliates right) under Section 5.10 (except for Section 5.10(f)) and its Representatives acting on behalf (ii) the expiration of the Live Parties Lock-Up Period (collectively with the Live Parties“Standstill Expiration Date”), without the prior written approval of the Board, the “Restricted Persons”) to Investor Parties will not, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Boardand will cause their Affiliates not to:
(ia) acquire, offer or seek to acquire, agree to acquire or make a proposal to acquire, by purchase or otherwise, any equity securities or direct or indirect rights to acquire any equity securities of the Company, any securities convertible into or exchangeable for any such equity securities, any options or other derivative securities or contracts or instruments in any way related to the price of shares of Common Stock (solely to the extent that, after giving effect to such acquisition, the Investor Parties and their Affiliates would beneficially own, in the aggregate, greater than 15% of the then outstanding Common Stock (which calculation shall, for the avoidance of doubt, include the notional or other number of shares of Common Stock specified in the documentation for any Contract to which any of the Investor Parties are party which is designed to produce economic benefits and risks to any of the Investor Parties that correspond substantially to the ownership by the Investor Parties of shares of Common Stock, except in the case of any such Contract which is settled only in cash));
(b) make or in any public announcement, proposal way encourage or offer (including participate in any “solicitation” of “proxies” (whether or not relating to the election or removal of directors), as such terms are defined or used in Regulation 14A the rules of the Exchange Act))SEC, written consents to vote, or knowingly seek to advise or influence any Person with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination voting of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records voting securities of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law Subsidiaries, or any other statutory call or regulatory provisions providing for stockholder access seek to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become call a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent meeting of the Company;
(vi) knowingly encourage ’s stockholders or advise initiate any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, stockholder proposal for the avoidance of doubt, with respect to action by the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matterstockholders, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage seek election to or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by place a representative on the Board and consistent with or seek the recommendation removal of any director from the Board;
(ixc) engage in make any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) public announcement with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline offer, seek, propose or indicate an interest in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly with or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”without conditions), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance reorganization or otherwise) or (y) the issuance purchase of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 2550% of the Common Stockassets, in the case of each of clause (x) and (y), with any Person other than a Live Party properties or an Affiliate securities of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director Subsidiary of the Company, (ii) or any financial advisor, legal counsel or other advisor to extraordinary transaction involving the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer Subsidiary of the Company or any of their respective securities, or enter into any discussions, negotiations, arrangements, understandings or agreements (who is not also a director), whether written or oral) with respect to any other Person regarding any of the foregoing mattersforegoing;
(d) otherwise act, so long as alone or in concert with others, to seek to control or influence, in any such communication is (x) not released publicly by manner, the Live Parties management, board of directors or their Representatives policies of the Company or any Third Party of its Subsidiaries;
(at the direct e) make any proposal or indirect request statement of inquiry or disclose any intention, plan or arrangement inconsistent with any of the Live Partiesforegoing;
(f) and advise, assist, knowingly encourage or direct any Person to do, or to advise, assist, knowingly encourage or direct any other Person to do, any of the foregoing;
(yg) not made in a manner take any action that would require, or reasonably be expected to require, the Live Parties or require the Company to make a public announcement regarding such proposal. For the possibility of a transaction or any of the events described in this Section 5.07;
(h) enter into any agreements, arrangements or understandings with any third party (including security holders of the Company, but excluding, for the avoidance of doubt, any Investor Parties) with respect to any of the foregoing, including forming, joining or in any way participating in a “group” (as defined in Section 13(d)(3) of the Exchange Act) with any third party in connection with any of the foregoing;
(i) request the Company or any of its Representatives, directly or indirectly, to amend or waive any provision of this Section 5.07; provided that this clause shall not prohibit the Investor Parties from making a confidential request to the Company seeking an amendment or waiver of the provisions of this Section 5.07, which the Company may accept or reject in its sole discretion, so long as any such request is made in a manner that does not require public disclosure thereof by any Person; or
(j) contest the validity of this Section 5.07 or make, initiate, take or participate in any demand, Action (legal or otherwise) or proposal to amend, waive or terminate any provision of this Section 5.07; provided, however, that nothing in this Agreement shall prevent or Section 5.07 will (1) limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Investor Parties’ other Representatives for ability to vote, Transfer or Hedge (subject to Section 5.08), convert shares of Series B Preferred Stock into Common Stock (subject to Section 6 of the purpose Series B Certificate of evaluatingDesignations), negotiating the terms of and consummating the Transaction limit or restrict any transfer pursuant to a Permitted Loan or any transactions involving foreclosure thereunder or transfer in lieu of a foreclosure thereunder, privately make and submit to the CompanyCompany and/or the Board any proposal that is intended by the Investor Parties to be made and submitted on a non-publicly disclosed or announced basis (and would not reasonably be expect to require public disclosure by any Person), participate in rights offerings made by the Company to all holders of its Common Stock, receive any dividends or similar distributions with respect to any securities of the Company held by the Investor Parties, tender shares of Common Stock or Series B Preferred Stock into any tender or exchange offer (subject to Section 5.08), effect an adjustment to the Conversion Rate pursuant to the Series B Certificate of Designations or otherwise exercise rights under its Common Stock or Series B Preferred Stock that are not the subject of this Section 5.07, (2) limit the ability of the Investor Director to vote or otherwise exercise his or her legal duties or otherwise act in his or her capacity as a member of the Board or (3) apply to or otherwise restrict the Wella Sale.
Appears in 1 contract
Sources: Investment Agreement (Coty Inc.)
Standstill. During the Cooperation Period, each Live Party will not, Each Purchaser shall not (and will shall cause its Affiliates and its Representatives acting on behalf not to), without the prior written consent of the Live Parties Company's Board of Directors:
(collectively with the Live Partiesa) acquire, the “Restricted Persons”) announce an intention to notacquire, offer or propose to acquire or agree to acquire, directly or indirectly, without any voting securities of the prior written consentCompany as a result of which acquisition the Purchasers (and their Affiliates), invitationcollectively, would beneficially own more than 32.5% of the outstanding capital stock of the Company on a fully diluted basis, other than acquisitions by way of share dividends or authorization other distributions pro rata to holders of voting securities;
(b) propose that the Purchasers or any Affiliates of the Purchasers enter into, directly or indirectly, any merger or other business combination involving the Company or propose to purchase, directly or indirectly, a material portion of the assets of the Company or the Board:any of its Subsidiaries;
(ic) make make, or in any public announcementway participate in, proposal directly or offer (including indirectly, any “"solicitation” " of “"proxies” " (as such terms are defined or used in Regulation 14A promulgated under the Exchange Act) to vote or consent with respect to any voting securities of the Company (whether or not such solicitation is subject to regulation under Regulation 14A promulgated under the Exchange Act);
(d) form, join or participate in or encourage the, formation of a "group" with any person (within the meaning of Section 13(d)(3) of the Exchange Act)), written consents other than with the Purchaser's Affiliates, any other Purchaser and such other Purchaser's Affiliates;
(e) deposit any voting securities of the Company into a voting trust or subject any such voting securities to any arrangement or agreement with respect toto the voting or disposition thereof (other than any that may be effected among the Purchasers and their Affiliates);
(f) initiate, propose or otherwise solicit stockholders of the Company for the approval of one or more stockholder proposals with respect to the Company as described in Rule 14a-8 under the Exchange Act, or otherwise solicit, seek, cause, offer induce or offer attempt to effect, (A) induce any other person to initiate any such stockholder proposal with respect to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change ;
(g) except in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms accordance with Section 3 of this Agreement;
(ii) seek, alone seek election to or in concert with one seek to place a representative on the Company's Board of Directors or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, seek the removal of any member of the Company's Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholdersDirectors;
(iiii) solicit, seek to effect, negotiate with or provide non-public information to any other person with respect to, (ii) make any request for stockholder list materials statement or other books and records proposal, whether written or oral, to the Company's Board of Directors or any director or officer of the Company with respect to, or (iii) otherwise make any public announcement or proposal whatsoever with respect to, any form of business combination transaction (with any person) involving a change of control of the Company or the acquisition of a substantial portion of the equity securities or assets of the Company or any of its subsidiaries under Section 220 Subsidiaries, including a merger, consolidation, tender offer, exchange offer or liquidation of the Delaware General Corporation Law Company's assets, or any other statutory restructuring, recapitalization or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents similar transaction with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiariesSubsidiaries; PROVIDED, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, howeverHOWEVER, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against apply to discussions between or among the Company to enforce Purchasers, their Affiliates or any express provision of this Agreement instituted in accordance with and subject to Section 11their employees, agents or representatives or (B) making in the case of clause (ii) above, limit the ability of any counterclaim designee of the Purchasers on the Company's Board of Directors to make any such statement or proposal or to discuss any such proposal with respect any officer or director of or advisor to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate advisor to the subject matter Company's Board of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engageDirectors unless, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that either case, it would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such discussion, statement or proposal. For ;
(i) otherwise act, alone or in concert with others, to seek to control or influence the avoidance management or policies of doubtthe Company (except for (A) voting in its full discretion as a holder of voting securities in accordance with the terms of such voting securities and, nothing in this Agreement shall prevent or limit if applicable, together with the Live Parties or their respective other Purchasers and the Purchasers' Affiliates and Representatives from working with (B) actions taken as a director of the Live Parties Company);
(j) request, or take any action to obtain, any list of holders of voting securities of the Live Parties’ other Representatives Company for the purpose of evaluatingaccomplishing any of the actions in Sections 4(a)-(i) hereof;
(k) publicly disclose any intention, negotiating plan or arrangement inconsistent with the terms foregoing, or make any such disclosure privately if it would reasonably be expected to require the Company to make a public announcement regarding such intention, plan or arrangement; or
(l) advise, assist (including by knowingly providing or arranging financing for that purpose) or knowingly encourage any other person in connection with any of and consummating the Transaction or any transactions involving the Companyforegoing.
Appears in 1 contract
Standstill. During the Cooperation Standstill Period, each Live Party will notthe Investor, and will cause or any of its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live PartiesAffiliates, the “Restricted Persons”) to not, shall not directly or indirectly, except as expressly invited in writing by the Company:
i. subject to Section 5.16, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies express consent of the Company, acquire any additional equity securities (including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (BOrdinary Shares, American Depositary Shares and Ordinary Share Equivalents) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any instrument that gives the Investor or any of its subsidiaries under Section 220 Affiliates the economic equivalent of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records ownership of an amount of securities of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” Derivative”) if, after such acquisition, the Investor would beneficially own more than twenty one percent (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act21.0%) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Companyoutstanding share capital;
(x) sellii. knowingly encourage or support a tender, exchange or other offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held proposal by a Live Party or Affiliates of the Live Parties;
(xi) instituteThird Party, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for from and after the avoidance filing of doubta Schedule 14D-9 (or successor form of Tender Offer Solicitation/Recommendation Statement under Rule 14d-9 of the Exchange Act) by the Company recommending that stockholders accept any such offer filed after such offer has commenced, the foregoing Investor shall not prevent any Live Party be prohibited from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do taking any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement otherwise prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or clause (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, maintains and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as withdraw such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stockrecommendation;
iii. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities propose (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, purchase of the Company’s assets or businesses, or similar transaction involving the Company or (y) any recapitalization, restructuring, saleliquidation or other extraordinary transaction with respect to the Company;
iv. seek to have called any meeting of the shareholders of the Company, equity issuance propose or otherwisenominate for election to the Company’s board of directors any person whose nomination has not been approved by a majority of the Company’s board of directors (excluding the Designated Director, if any) or cause to be voted in favor of such person for election to the Company’s board of directors any Ordinary Shares or American Depositary Shares of the then outstanding share capital of the Company or Ordinary Share Equivalents (yincluding any Derivatives) other than as contemplated by Section 5.3 hereof;
v. solicit proxies or consents or become a participant in a solicitation (as such terms are defined in Regulation 14A under the Exchange Act) in opposition to the recommendation of a majority of the Company’s board of directors with respect to any matter, or seek to advise or influence any Third Party, with respect to voting of any Ordinary Shares or American Depositary Shares of the then outstanding share capital of the Company or Ordinary Share Equivalents (including any Derivatives);
vi. deposit any Ordinary Shares or American Depositary Shares of the then outstanding share capital of the Company or Ordinary Share Equivalents in a voting trust or subject any Ordinary Shares or American Depositary Shares of the then outstanding share capital of the Company or Ordinary Share Equivalents to any arrangement or agreement with respect to the voting of such Ordinary Shares or American Depositary Shares of the then outstanding share capital of the Company or Ordinary Share Equivalents other than as contemplated by Section 5.3 hereof; or
vii. act in concert with any Third Party to take any action in clauses (i) through (vi) above, or form or join in a “partnership, limited partnership, syndicate, or other group” with any Third Party within the meaning of Section 13(d)(3) of the Exchange Act with respect to the equity securities (including any Derivatives) of the Company. Notwithstanding the foregoing, (A) the issuance mere voting in accordance with Section 5.3 hereof of any voting securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in Company held by the case of each of clause (x) and (y), with any Person other than Investor or its Affiliates shall not constitute a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing violation of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contraryof clauses (i) through (vii) above, (B) nothing in this Agreement shall prohibit the Live Parties Investor or their Representatives any of its Affiliates from making non-public proposals tosubmitting to the board of directors of the Company or to management of the Company a confidential proposal for a transaction involving a Change of Control or other proposed action, provided that neither the Company nor the Investor or otherwise communicating withany of its Affiliates is required to publicly disclose the fact that such proposal or request to consider such a proposal was made, (C) if any executive officer or director of the Investor serves as a member of the Company’s board of directors, any action he or she takes in the performance of his or her duties as a member of the Company’s board of directors shall not be deemed to violate this Section 5.1, and (D) the provisions of this Section 5.1 shall terminate and be of no further force or effect if (i) the Board Company publicly announces the entry into a definitive agreement for the acquisition of the Company or more than fifty percent (50%) of its consolidated assets by a third party, or (ii) any director person commences a tender or exchange offer with respect to the securities representing fifty percent (50%) or more of the voting power of the Company, unless the Company files a recommendation statement under Rule 14d-9 of the Exchange Act (or such successor provision) with the SEC within 10 business days following commencement of such offer advising the Company’s stockholders to reject such offer (provided that if any transaction referred to in the foregoing clauses (i) and (ii) any financial advisoris terminated or abandoned, legal counsel or other advisor to then the provisions of this Section 5.1 shall again become effective). In the event that the Company engages in discussions or the Board or (iii) solely to the extent directed or permitted by the Board, any officer negotiations involving a possible Change of Control of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to requireCompany, the Live Parties or Investor will be given notice thereof and the Company right to make a public announcement regarding such proposal. For participate in any process on substantially the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ same terms as other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companyparticipants.
Appears in 1 contract
Standstill. 6.1.1 The standstill obligation, as set out in this Article 6.1, will take effect as of the Date of this Agreement and will terminate on the earlier of (x) the date that is ten (10) years following the date on which the Closing occurs and (y) the termination of this Agreement if the Closing does not occur (the “Standstill Period”).
6.1.2 During the Cooperation Standstill Period, each Live Party will not, and will cause its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live PartiesInvestor, the “Restricted Persons”) to Parent Investor or any of their Affiliates, shall not, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A without the express written consent of the Exchange Act))Issuer, written consents with respect todirectly or indirectly acquire any additional Equity Securities (other than the Warrants) of the Issuer, or otherwise solicit, seek, cause, offer or offer if after giving effect to effect, (A) any proposal to seek representation on such acquisition the Board or otherwise seek to control or influence the managementInvestor, the Board or the policies of the CompanyParent Investor, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms Affiliates of this Agreementthe Investor or the Parent Investor, or any other party Acting in Concert with the Investor, the Parent Investor or any of the Affiliates of the Investor or the Parent Investor would (without taking into account the Warrants or the shares issuable (but not yet issued) thereunder owned by them at that time) together in the aggregate directly or indirectly own or have the right to acquire more than 29.9% of the then issued and outstanding voting securities of the Issuer (assuming the exercise, conversion or exchange of any Equity Securities held by any of them at any time (other than the Warrants) that are exercisable, convertible or exchangeable into or for shares of the Issuer at such time) (the resulting number of securities rounded down) (the “Standstill Limit”);
(ii) seek, alone directly or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, indirectly encourage or participate in any “withhold” support a tender, exchange or similar campaign with respect to any meeting of stockholdersother offer or proposal by a third party;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
propose (iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services fora) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, purchase of the Issuer’s assets or businesses, or similar transaction involving the Issuer or (b) any recapitalization, restructuring, sale, equity issuance liquidation or otherwiseother extraordinary transaction with respect to the Issuer (it being understood that the Investor’s Chief Executive Officer may contact the Issuer’s Chief Executive Officer on a non-public and non-committal basis to gauge the Issuer’s Chief Executive Officer’s views on the Issuer’s potential interest in any such matter described in clause (a) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (yb), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.; or
Appears in 1 contract
Standstill. During the Cooperation Period, each Live Investor Party will not, and will cause its respective Affiliates and its Representatives acting on its behalf of the Live Parties (collectively with the Live Investor Parties, the “Restricted Persons”) to not, directly or indirectly, without the prior written consent, invitation, consent or authorization of the Company or the Board:
(i) make (A) acquire, by purchase or otherwise, alone or in concert with any public announcementThird Party, proposal or offer any Company Interests if such acquisition would result in the Investor Parties (including any “solicitation” together with their Affiliates) having Beneficial Ownership of “proxies” (as such terms are defined or used in Regulation 14A more than 14.9% of the Exchange ActCommon Stock outstanding at such time; (B) acquire, by purchase or otherwise, alone or in concert with any Third Party, indebtedness (or shares of preferred stock) outstanding under Debt Instruments if such acquisition would result in the Investor Parties (together with their Affiliates) holding in excess of 25% of the total aggregate principal amount of indebtedness (and liquidation preference) then outstanding under Debt Instruments (including, for the purposes of this clause, the outstanding amount of any debt drawn under the revolving credit facility as of the most recently filed Form 10-Q or 10-K by the Company, and excluding, any amounts drawn under securitization facilities)); (C) Transfer any Company Interests to a Restricted Transferee in one or a series of related (x) private transactions and/or (y) other transactions where the purchaser in the Transfer is actually known to the Restricted Persons to be a Restricted Transferee; (D) Transfer all or substantially all, written consents with respect todirectly or indirectly, of the voting rights of the underlying Common Stock held by the Restricted Persons to any Third Party decoupled from such underlying Common Stock, or (E) effect, cause or knowingly participate in, or in any way knowingly assist, facilitate or encourage any Third Party to effect or seek, offer or propose to effect or participate in, an Extraordinary Transaction (it being understood that the foregoing shall not restrict the Restricted Persons from tendering (or failing to tender) shares, receiving consideration or other payment for shares, voting its Voting Securities “for” or “against” any Extraordinary Transaction, or otherwise solicit, seek, cause, offer or offer to effect, (A) participating in any proposal to seek representation Extraordinary Transaction on the Board or otherwise seek to control or influence the management, the Board or the policies same basis as other stockholders of the Company, including or from directing any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary contact from a Third Party which may contemplate such an Extraordinary Transaction to (or may require the Company to waive) any of the terms of this Agreementor its Representatives);
(ii) (A) call or seek to call (publicly or otherwise), alone or in concert with others, a meeting of the Company’s stockholders or act or seek to act by written consent in lieu of a meeting (or the setting of a record date therefor), (B) seek, alone or in concert with one or more Third Partiesothers, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, nominate or propose the nomination of, or recommend the nomination of, any candidate to the Board, except as expressly set forth in Section 1, (C) make or be the proponent of any stockholder proposal to the Company or the Board or any committee thereof to be voted on by the stockholders of the Company, (D) seek, alone or in concert with othersothers (including through any “withhold” or similar campaign), the removal of any member of the Board other than the New Director or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting (E) conduct a referendum of stockholdersstockholders of the Company;
(iii) make any request for stockholder stock list materials or other books and records of the Company or any of its subsidiaries under pursuant to Section 220 of the Delaware General Corporation Law of the State of Delaware or any other statutory or regulatory provisions providing for stockholder access to books and records records, except, for the avoidance of the Company doubt, in connection with any matter as to which any litigation, arbitration or its Affiliatesother proceeding would be permitted pursuant to Section 2(c)(x);
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) promulgated under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A promulgated under the Exchange Act) in any such solicitation of proxies or consentsconsents (other than with respect to the New Director in connection with the actions contemplated by Section 1(a));
(v) disclose make any public proposal concerning the Company seeking to change the number or identity of directors of the Company or the filling of any Third Partyvacancies or newly created directorships on the Board, either publicly or any change in a manner that would reasonably be expected to result in or require public disclosurethe capital allocation policy, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent dividend policy of the Company, any other change to the Board or the Company’s management or corporate governance structure or policy, or any waiver, amendment or modification to the Charter or the Bylaws or any Company Policies;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum of stockholders relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly specifically permitted by under this Agreement;
(vii) form, join, knowingly encourage join or knowingly participate in or knowingly act in concert with any Group Group, with respect to any Voting Securities, other than a Group consisting solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by themInvestor Parties;
(viii) enter into any a voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between with Investor Parties or among Affiliates of the Live Investor Parties and their Affiliates, or (C) granting any proxy proxies in any solicitation solicitations approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any equity security (other than any index fund, exchange-exchange traded fund, benchmark fund or broad basket of securities) that (A) includes, relates to, or derives any significant part of its value from a decline in the market price or value of any the equity securities of the Company’s securities Company and (B) would, in the aggregate or individually, result in the Live Investor Parties ceasing to have a Net Long Position “net long position” in equity securities of the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, knowingly solicit or join as a party any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, subsidiaries or any of its or their respective current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party Restricted Person from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 118, (B) making any counterclaim counterclaims with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Partya Restricted Person, (C) bringing bona fide commercial disputes and/or enforcing contractual rights that do not relate to the subject matter of this AgreementAgreement (including for the avoidance of doubt proceedings with respect to Debt Instruments held by the Investor Parties or their Affiliates), (D) exercising statutory appraisal rights, rights or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xviixi) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that in a manner which would reasonably be expected to give rise to result in a requirement to publicly announce public announcement or disclose disclosure of such request or proposal; provided that the restrictions in this Section 3(cor
(xii) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); providedenter into any negotiations, furtheragreements, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officerarrangements, or General Counsel understandings (whether written or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferencesoral) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communicationswith, or (VIII) purchasing orknowingly encourage, subject to Section 2 hereofassist, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals tosolicit, or otherwise communicating withseek to cause, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at to take any action that the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected Restricted Persons are prohibited from taking pursuant to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the CompanySection 2(c).
Appears in 1 contract
Sources: Cooperation Agreement (Anywhere Real Estate Group LLC)
Standstill. During (a) Unless approved in advance in writing by at least two-thirds of the Cooperation Perioddirectors of the Board of Directors of Red Lion, each Live Party will notNavy agrees that neither it nor any of its controlled affiliates will, and that it will use its reasonable best efforts to cause its Affiliates directors and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notofficers not to, directly or indirectly, without except as otherwise provided in this Agreement, until the prior written consent, invitation, or authorization end of the Company or the BoardStandstill Period:
(i) make any public announcementacquire, proposal directly or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act))indirectly, written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling beneficial ownership of any vacancy on the Board or (B) any public proposal additional Red Lion Common Shares or other statement that is directly contrary equity securities of Red Lion, other than (i) by exercising any preemptive rights available to (Navy or may require the Company to waive) any of the terms of this Agreement;
its affiliates or (ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, as the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal result of any member of the Board or initiatestock split, encourage or participate in any “withhold” stock dividend, bonus issue, share subdivision, reverse stock split or similar campaign with respect to any meeting of stockholders;
transaction (iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SECprovided, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (includinghowever, for the avoidance of doubt, with respect to that notwithstanding the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts foregoing Navy and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any its controlled affiliates may purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate aggregate, a number of Red Lion Common Shares equal to the number they have sold from after Closing (as adjusted for any stock split, stock dividend, bonus issue, share subdivision, reverse stock split or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreementsimilar transaction); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations arrangements, understandings or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade finance or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with assist any other person that engages, or offers or proposes to engage, in connection with any of the actions prohibited by this Section 3(c);foregoing; or
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into arrangements, understandings or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding agreements (whether written or oral) with, or advise, finance or assist any other person in connection with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement foregoing; or
(including this subclause)iii) request, propose or otherwise seek, in each case publicly or in a manner that would reasonably be expected to give rise to a requirement to publicly announce require public disclosure, any amendment or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end waiver of the notice period); provided, further, that provisions contained in clauses (i)-(ii) above.
(b) Unless approved in advance in writing by at least two-thirds of the event that directors of the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”)Directors of Red Lion, then the restrictions and obligations set forth in Section 3 shall remain in effect until (Navy agrees that neither it nor any of its directors, officers or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or tradingcontrolled affiliates will, directly or indirectly, except as otherwise provided in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by until the Company or any end of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not Standstill Period:
(i) prohibit the Live Parties from privately identifying potential candidates seek, make or take any action to be nominated solicit or encourage any offer or proposal for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, amalgamation consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance sale or otherwise) purchase of assets or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolutionbusiness combination, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions transaction involving the Company.Red Lion;
Appears in 1 contract
Standstill. During the Cooperation Period, each Live Party will not, and will cause its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to not, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of Neither any member of the Board Purchaser Group nor any Purchaser Successor shall enter into any transaction or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting series of stockholders;
(iii) make any request for stockholder list materials or other books and records transactions as a result of which the members of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SECPurchaser Group, but includingtogether with all Purchaser Successors, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that collectively would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” have beneficial ownership (as such term is defined in Instruction 3 to Item 4 Section 13(d) of Schedule 14A under the Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder, as amended (the "Exchange Act")) in any such solicitation the aggregate of proxies 50% or consents;more of the outstanding voting securities of the Corporation, unless:
(vi) disclose in connection therewith, such member of the Purchaser Group or Purchaser Successor commences a tender or exchange offer for all of the outstanding voting securities of the Corporation (at a price at least equal to any Third Partythe market price thereof immediately prior to the earlier of the public announcement or commencement thereof) or acquires, either publicly or in a manner that would reasonably be expected enters into an agreement to result in or require public disclosureacquire, its all of such voting or consent intentions or any vote as to any matter submitted securities pursuant to a stockholder vote during merger or other business combination transaction with the Cooperation Period Corporation (it being understood that instructing a Third Party the prohibitions set forth in the first sentence of this Section 6 of this Article V shall not apply (A) to implement any such offer, merger or transaction or (B) from and after the consummation of such offer, merger or transaction if, but only if, as a result of the consummation thereof the members of the Purchaser Group, together with any Purchaser Successor, have beneficial ownership in the aggregate of 50% or more of the outstanding voting securities of the Corporation);
(ii) such transaction or series of transactions is approved by an affirmative vote of a majority of the independent directors of the Board of Directors of the Corporation; or
(iii) a party that is not an Affiliate of any member of the Purchaser Group or consent of any Purchaser Successor acquires (and continues to hold), or has announced its intention (and is currently seeking) to acquire, through any transaction or series of transactions, including through any tender or exchange offer, beneficial ownership in the aggregate of 25% or more of the outstanding voting securities of the Corporation or has announced its intention (and is currently seeking) to effect a ministerial manner merger or other business combination transaction with the Corporation as a result of which such party would become the beneficial owner of 25% or more of the outstanding voting securities of the surviving corporation of the merger or business combination, which merger or other business combination has been approved by the Board of Directors of the Corporation; provided, however, in the event that any member of the Purchaser Group or any Purchaser Successor makes any such acquisition pursuant to the exception provided in this clause (iii) then, unless such acquisition was also in accordance with clause (i) or (ii) above or unless either of the following paragraphs is also applicable, a majority of the Board of Directors of the Corporation shall continue to consist of independent directors. The requirements set forth in Section 5 and Section 6 of this Article V shall cease to apply from and after the first to occur of (x) such time as a majority of the independent directors so determines, (y) the acquisition of beneficial ownership of 50% or more of the outstanding voting securities of the Corporation under the circumstances described in clauses (i) or (ii) above or (z) the members of the Purchaser Group and the Purchaser Successors acquire aggregate beneficial ownership of 80% or more of the outstanding voting securities of the Corporation. In determining whether Section 5 and Section 6 of this Article V shall have ceased to apply at any time in accordance with this Agreement would not paragraph, the percentage beneficial ownership of the outstanding voting securities of the Purchaser Group and Purchaser Successors at any time shall be a violation determined as follows: First, the number of this provision)shares of voting securities beneficially owned at such time by the Purchaser Group, except that together with the number of shares of voting securities beneficially owned by all Purchaser Successors, shall be the numerator. Second, the number of issued and outstanding voting securities of the Corporation at such disclosure may time shall be determined and there shall be added to such number an amount of voting securities equal to the number of shares of Common Stock purchased by the Corporation from and after May 6, 2008. This number shall be the denominator. Third, the numerator, determined as provided above, shall be divided by the denominator, determined as provided above, and the resulting percentage shall be considered the percentage beneficial ownership of the Purchaser Group and all Purchaser Successors at such time. The foregoing determination, or any other calculation as to the beneficial ownership of the outstanding voting securities of any Person, shall be made if required by law or if permitted by the prior written consent “independent directors”, based on such information, opinions, reports or statements presented by such Persons as the “independent directors” reasonably believe are within such Persons’ professional or expert competence and selected with reasonable care by or on behalf of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party Corporation. Any such determination by the “independent directors” shall be conclusive and binding, absent manifest error. As used in encouraging or advising any other Person with respect to (A) these Articles, the giving or withholding following terms shall have the meanings set forth below: An “Affiliate” of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice Person shall mean another Person that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap one or hedging transactions or otherwisemore intermediaries, all or substantially allControls, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated is Controlled by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) is under common Control with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) first Person. Liberty Media Corporation and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement Corporation shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any deemed Affiliates of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companyone another.
Appears in 1 contract
Sources: Letter Agreement (Directv Group Inc)
Standstill. (a) During the Cooperation Standstill Period, each Live Party will the Investor Stockholders shall not, and will cause its Affiliates and its Representatives acting on behalf the Investor Stockholders shall ensure that none of the Live Parties (collectively with the Live PartiesElevation Entities or their respective Affiliates shall, the “Restricted Persons”) to not, directly or indirectly, without the prior written consent, invitation, or authorization nor shall any of the Company or the Boardforegoing Persons act in concert with any other Person to:
(i) make any public announcement, proposal or offer except (including any “solicitation” of “proxies” (x) as such terms are defined or used in Regulation 14A a result of the Exchange Act))Beneficial Ownership of or exercise of any Rights, written consents with respect to(y) the receipt of any Capital Stock, rights or otherwise solicitother securities from the Company pursuant to the terms of the Series B Preferred Stock (or the exercise or conversion of any such Capital Stock rights or other securities) and (z) Equity Securities issued to Series B Directors or Investor Directors in their capacities as such, seek, cause, offer or offer to effectif any, (A) acquire or hold any proposal to seek representation on the Board Economic Right or otherwise seek to control or influence the management, the Board or the policies Beneficial Ownership of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board Equity Securities or (B) any public proposal authorize or make a tender offer, exchange offer or other statement offer or proposal, whether oral or written, to acquire Equity Securities, in each case, if the effect of such acquisition or holding would be that the Common Stock Beneficially Owned in the aggregate by the Investor Stockholders and their Affiliates (including, without limitation, any 13D Group of which any Investor Stockholder or any Affiliate thereof is directly contrary to (or may require a member) would exceed the Company to waive) any Standstill Limit, provided that for purposes of calculating the number of shares of Common Stock Beneficially Owned by the Investor Stockholders and their Affiliates, there shall be excluded from such calculation shares of Common Stock Beneficially Owned by Affiliates of the terms Investor Stockholders that are not also Beneficially Owned by the Investor Stockholders up to the maximum number of shares of Common Stock that will be excluded pursuant to this Agreementclause equal one percent (1%) of the Diluted Common Shares Outstanding;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage (A) solicit or participate in any “withhold” or similar campaign solicitation of proxies with respect to any meeting Voting Stock, or (B) seek to advise or influence any Person with respect to the voting of stockholdersany Voting Stock (other than (x) the Investor Stockholders or any Affiliate or (y) other than in accordance with and consistent with the recommendation of the Board); provided, that the limitation contained in this clause (ii) shall not apply to any proposal recommended by the Board relating to a Change in Control of the Company to be voted on by the Company’s stockholders that is not instituted or proposed by any Investor Stockholder or any Affiliate of any Investor Stockholder or any 13D Group of which any Investor Stockholder or any Affiliate of an Investor Stockholder is a member;
(iii) make deposit any request for stockholder list materials Voting Stock in a voting trust or, except as otherwise provided or other books and records contemplated herein, subject any Voting Stock to any arrangement or agreement with any Person with respect to the voting of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliatessuch Voting Stock;
(iv) engage in any “solicitation” join a 13D Group (as such term is used in the proxy rules other than a group comprising solely of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10Investor Stockholders and their Permitted Transferees) or fewer stockholders that would other group, or otherwise be excluded from act in concert with any third Person for the definition purpose of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) acquiring, holding, voting or disposing of one Voting Stock or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consentsNon-Voting Convertible Securities;
(v) disclose to any Third Partyeffect or seek, either offer or propose (whether publicly or otherwise) to effect any Change in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent Control of the Company;
(vi) knowingly encourage effect or advise seek, offer or propose (whether publicly or otherwise) to effect any Third Party or knowingly assist any Third Party in encouraging or advising any recapitalization (other Person with respect to (A) than the giving or withholding of any proxy relating toMerger), restructuring, liquidation, dissolution or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, transaction with respect to the Company’s management Company or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreementany of its Subsidiaries;
(vii) form, join, knowingly encourage authorize or knowingly participate in take any action to permit any Affiliate of Elevation to be named as a director candidate on a proxy or knowingly act in concert with ballot of any Group with respect to any Voting Securities, other Person other than solely with Affiliates the proxy or ballot of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent Company with the recommendation of the Board;
(ixviii) engage otherwise act, alone or in any short sale concert with others, to effect or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sellseek, offer or agree to sell, directly or indirectly, through swap or hedging transactions propose (whether publicly or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates ) to effect control of the Live Parties;
(xi) institutemanagement, solicit Board or join any litigation, arbitration or other proceeding against or involving policies of the Company or to seek a waiver of any provision of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing no action by a Series B Director or Investor Director (solely in their capacities as such) shall not prevent any Live Party from (A) bringing litigation against the Company be deemed to enforce any express provision of violate this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process4.2(a)(viii);
(xiiix) knowingly instigatetake any action that results in the Investor Stockholders having to file or amend a Schedule 13D indicating an intention, cooperate with plan or assist (including by providing or arranging financing or other services for) any Third Party proposal to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;foregoing; or
(xiiix) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) otherwise take any action that would or could reasonably be expected to (i) require any Live Party or compel the Company to make a public announcement regarding any of the actions matters set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;4.2.
(xvb) enter into or maintain If, at any economictime during the Standstill Period, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters has entered into a definitive agreement with respect agreement, the consummation of which would result in a Fundamental Change, or (ii) any Person shall have commenced and not withdrawn a bona fide public tender or exchange offer which if consummated would result in a Fundamental Change and the Board has not recommended that its stockholders reject such offer within the time period contemplated by Rule 14d-9, for so long as such condition continues to apply, the limitation on the actions described in clauses (a)(ii), (a)(iii), (a)(iv) (and any related acquisition of Beneficial Ownership solely by being part of a transaction involving group shall be exempt from (xa)(i)), (a)(v), (a)(vi), (a)(ix) and (a)(x) above shall not be applicable to the sale Investor Stockholders (but all other provisions of this Agreement will, subject to Section 4.2(c), continue to apply).
(c) Anything in this Section 4.2 to the contrary notwithstanding, this Section 4.2 shall not prohibit or transfer of all restrict any actions taken by the Investor Stockholders’ designee or designees on the Board in their capacities as a controlling portion member of the Company’s equity securities Board and in compliance with and subject to his or all or her fiduciary duties as a substantially all member of the Company’s assets Board.
(whether d) The Investor Stockholders agree that during the Standstill Period they will not directly or indirectly propose, effect or agree to any transaction which if consummated would result in a Change of Control of the Company in which the acquiring counterparty is (i) an Investor Stockholder or an Affiliate of an Investor Stockholder or (ii) a member of a 13D Group of which an Investor Stockholder or an Affiliate of an Investor Stockholder is also a member, in each case unless such transaction is approved by merger, consolidation, business combination, (or in the case of a tender or exchange offer, recapitalizationis conditioned on the receipt of tenders from), restructuring, sale, equity issuance or otherwise) or (y) the issuance holders of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% a majority of the outstanding shares of Common Stock, Stock not Beneficially Owned by the Investor Stockholders or any of their affiliates (as defined in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate Section 12b-2 of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a directorExchange Act), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 1 contract
Sources: Stockholders' Agreement (Palm Inc)
Standstill. During The Investors agree that, until the Cooperation Periodone year anniversary following the Voting Right Expiration Date (or, each Live Party will in the event of a Standstill Termination Event, January 1, 2022), the Investors shall not, and will shall cause its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notentities controlled by them not to, directly or indirectly, without the prior written consentconsent of a majority of the disinterested directors serving on the Company’s Board of Directors or as required pursuant to the terms of the Voting Agreement:
(a) other than pursuant to clause (b) below, invitationacquire, offer or seek to acquire, agree to acquire or make a proposal to acquire, whether by private or open market purchase, a block trade, or authorization a tender or exchange offer, beneficial ownership of, or any economic interest in, any right to direct the voting or disposition of, or any other right with respect to any equity securities or direct or indirect rights to acquire any equity securities of the Company Company, any securities convertible into or exchangeable for any such equity securities, in each case solely to the extent that, after giving effect to such acquisition or transaction, either (i) the Magnetar Investors, taken together with their respective Affiliates, would beneficially own (as determined in accordance with Rule 13d-3 under the Exchange Act), in the aggregate, greater than 15.0% of the then outstanding Common Stock or (ii) the White Hat Investor, taken together with its respective Affiliates, would beneficially own (as determined in accordance with Rule 13d-3 under the Exchange Act), in the aggregate, greater than 5.0% of the then outstanding Common Stock;
(b) enter into any options, puts, calls, swaps or other derivative or convertible instruments, hedging contracts or other derivative securities or similar contracts or instruments in any way related to the purchase or sale of Common Stock and/or price of shares of the Common Stock, provided that, from and after the one-year anniversary of the Initial Closing Date, each of the Magnetar Investors and the White Hat Investor, respectively, shall be entitled to enter into any such transactions so long as the aggregate number of shares of Common Stock (or the Board:value thereof based on the last reported trading price of the Common Stock on the immediately preceding trading day) subject to all such transactions engaged in by the Magnetar Investors or the White Hat Investor, respectively, on any given trading day does not exceed more than 45% of the sum of the number of Conversion Shares (or the value thereof based on the last reported trading price of the Common Stock on the immediately preceding trading day) then owned by the Magnetar Investors and their Permitted Transferees or the White Hat Investor and its Permitted Transferees, as applicable, plus the number of Conversion Shares (or the value thereof based on the last reported trading price of the Common Stock on the immediately preceding trading day) underlying the shares of Series A Preferred Stock then owned by the Magnetar Investors and their Permitted Transferees or the White Hat Investor and its Permitted Transferees, as applicable, on as-converted basis (without giving effect to any limitation on conversion set forth in Section 10(h) of the Certificate of Designations), plus the number of any shares of Common Stock owned by the Magnetar Investors or the White Hat Investor, as applicable, as of the date hereof, in the aggregate; and provided further that, in the event of any breach by the Investors of this Section 4.5(b), the rights of the Investors under Section 9(a) and Section 9(b) of the Certificate of Designations shall immediately terminate;
(i) make or in any public announcement, proposal way encourage or offer (including participate in any “solicitation” of “proxies” or consents (whether or not relating to the election or removal of directors), as such terms are defined or used in Regulation 14A the rules of the SEC (but without regard to the exclusion set forth in Rule 14a-1(l)(2)(iv) promulgated under the Exchange Act)), written consents to vote, or knowingly seek to advise, encourage or influence any Person with respect toto voting of, any voting securities of the Company or otherwise solicit, seek, cause, offer any securities convertible or offer to effectexchangeable into or exercisable for any such voting securities, (Aii) any proposal to seek representation on the Board request, call or otherwise seek to control call (or, for the avoidance of doubt, publicly support another Person’s request or influence the management, the Board or the policies call for) a meeting of the Company, including any change in the number of directors serving on the Board ’s stockholders or action by written consent (or the filling setting of a record date therefor), other than of or by the holders of the Series A Preferred Stock voting as a separate class for the purpose of voting or consenting to the matters on which the holders of Series A Preferred Stock have the right to vote or consent to under Section 9 of the Certificate of Designations, (iii) initiate or be the proponent of any vacancy on stockholder proposal for action by the Board or Company’s stockholders, (Biv) any public proposal or other statement that is directly contrary to (or may require except as contemplated by this Agreement and the Company to waive) any Certificate of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the BoardDesignations, seek, alone or in concert with others, representation on the Board of Directors or the removal of any member of director from the Board or initiate, encourage or participate in of Directors (including through any “withhold” or similar campaign with respect to any meeting of stockholders;
campaign), or (iiiv) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage become a “participant” in any contested “solicitation” (as such term is terms are defined or used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to for the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement Voting Agreements, nothing in this paragraph (as defined herein)), with respect to an Extraordinary Transaction between b) shall restrict the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act voting by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage proxy in the ordinary course of business;
(d) make any public announcement with respect to, which lien or encumbrance is released upon the transfer of such claim offer, seek, propose or indicate an interest in accordance (in each case with the terms of the custody or prime brokerage agreement(swithout conditions), as applicableeither alone or in concert with others, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance reorganization or otherwise) or (y) the issuance purchase of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 2550% of the Common Stockassets, properties or securities of the Company or any Subsidiary of the Company, or any other extraordinary transaction involving the Company or any Subsidiary of the Company or any of their respective securities, or enter into any discussions, negotiations, arrangements, understandings or agreements (whether written or oral) with any other Person regarding any of the foregoing (it being understood that the foregoing shall not restrict a Person from tendering shares, receiving payment for shares or otherwise participating in any such transaction on the same basis as other stockholders of the Company);
(e) except as contemplated by this Agreement and the Certificate of Designations, otherwise act, alone or in concert with others, to seek to control or influence, in any manner, the case management, Board of each of clause (x) and (y), with any Person other than a Live Party Directors or an Affiliate business of the Live Parties Company or (ii) the Company adopts any plan of complete or partial liquidationits Subsidiaries, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, including (i) changing the Board of Directors or any director management of the Company, including any plans or proposals to declassify the Board of Directors or to change the number or term of directors or to fill any vacancies on the Board of Directors, (ii) any financial advisormaterial change in the capitalization, legal counsel capital allocation policy or other advisor to dividend policy of the Company or the Board Company, or (iii) solely seeking to have the Company waive or make amendments or modifications to the extent directed Certificate of Incorporation or permitted by Bylaws, or other actions that may impede or facilitate the Board, any officer acquisition of control of the Company by any Person;
(who is not also a director)f) advise, with respect assist, knowingly encourage or direct any Person to do, or to advise, assist, knowingly encourage or direct any other Person to do, any of the foregoing matters, so long as foregoing;
(g) take any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner action that would require, or reasonably be expected to require, the Live Parties or require the Company to make a public announcement regarding any of the foregoing;
(h) enter into any agreements, arrangements or understandings with any third party (including security holders of the Company) with respect to any of the foregoing, including forming, joining or in any way participating in a “group” (as defined in Section 13(d)(3) of the Exchange Act) with any third party in connection with any of the foregoing (it being understood that each Investor and its Affiliates, or the Investors collectively, shall not be considered a “group” for purposes of this clause (g)); or
(i) except as contemplated by this Agreement and the Certificate of Designations, request the Company or any of its Representatives, directly or indirectly, to amend or waive any provision of this Section 4.5; provided that this clause shall not prohibit the making of a confidential request to the Company seeking an amendment or waiver of the provisions of this Section 4.5, which the Company may accept or reject in its sole discretion, so long as any such proposal. For request is made in a manner that does not require public disclosure thereof by any Person; provided, however, that subject to the avoidance terms of doubtSection 4.3 and the Voting Agreements, nothing in this Agreement Section 4.5 will (i) prevent the Investors’ designee serving on the board of directors of the Company from taking any action while acting in such designee’s capacity as a director of the Company in accordance with his or her fiduciary duties as a director or (ii) limit the ability to vote or transfer shares of Common Stock, privately make and submit to the Board of Directors any proposal that is intended to be made and submitted on a non-publicly disclosed or announced basis (and would not reasonably be expected to require public disclosure by any Person), participate in rights offerings made by the Company to all holders of Common Stock, receive any dividends or similar distributions with respect to any securities of the Company, or tender shares of Common Stock into any tender or exchange offer. Notwithstanding the foregoing and excluding any purchase of debt or equity securities that may occur in connection with the transactions contemplated by this Agreement, nothing herein shall prevent either Investor from purchasing, selling or limit otherwise trading debt securities of the Live Parties Company if as a result of such purchase, sale or their respective Affiliates and Representatives from working with the Live Parties trade such Investor beneficially owns 9.9% or the Live Parties’ other Representatives for the purpose less of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company’s outstanding debt securities. This Section 4.5 shall supersede and replace Section 7 of the Confidentiality Agreements, dated September 3, 2021, between the Company and each respective Investor or its Affiliate in its entirety, and such provisions of Section 7 shall, upon execution of this Agreement, automatically terminate and be of no further force or effect.
Appears in 1 contract
Sources: Subscription Agreement (Comtech Telecommunications Corp /De/)
Standstill. During (a) As of the Cooperation date of this Agreement, except as previously disclosed in writing to Acquiror, THL represents that neither it nor any of its Affiliates beneficially owns any shares of Acquiror Common Stock or other securities entitled to be voted generally in the election of the board of directors of Acquiror or any direct or indirect options or other rights to acquire, or securities or other instruments that are convertible into, any such securities (collectively, “Securities”).
(b) Other than as set forth herein, during the period commencing on the date hereof and ending on the second anniversary of the Closing (the “Standstill Period”), each Live Party THL will not, and will cause its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notnot to, directly or indirectly, without singly or with any other person, unless invited in writing by the prior written consent, invitation, or authorization board of the Company or the Board:
directors of Acquiror to take such action: (i) acquire beneficial ownership of any Securities, or make a tender, exchange or other offer to acquire any public announcementSecurities that would result in THL owning, proposal controlling or offer (including otherwise having any “solicitation” beneficial or other ownership interest of “proxies” (as such terms are defined or used in Regulation 14A more than 9.9% of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies then-outstanding Securities of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
Acquiror; (ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company Acquiror or its Affiliates;
(iv) Securities, make, engage or in any way participate in, directly or indirectly, any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect (whether or not relating to the election or removal of one directors), or more seek to advise or influence any third Person with respect to the voting of any Securities; (iii) call or seek to have called any meeting of the stockholders of Acquiror, propose or nominate for election to the board of directors of Acquiror any Person or cause any of its Securities to be voted in favor of any Person whose nomination has not been approved by the Company board of directors of Acquiror; (iv) initiate, propose or any other matter or proposal relating to the Company or become a otherwise “participantsolicit” (as such term is defined used in Instruction 3 the proxy rules of the SEC) stockholders of Acquiror for the approval of shareholder proposals made to Item 4 of Schedule 14A Acquiror, whether made pursuant to Rule 14a-8 or Rule 14a-4 under the Exchange Act) in Act or otherwise, or cause or encourage or attempt to cause or encourage any other person to initiate any such solicitation shareholder proposal, regardless of proxies or consents;
its purpose; (v) disclose deposit any Securities in a voting trust or subject any Securities to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting the voting of such Securities, ; (vi) propose or subject any Voting Securities publicly announce or otherwise publicly disclose an intent to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale form of business combination, acquisition, Change of Control transaction or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect transaction relating to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company Acquiror or any of its subsidiaries, its current or former directors or its officers ; (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from vii) (A) bringing litigation against the Company act in concert with others (including any of its Affiliates) to enforce take any express provision of this Agreement instituted action in accordance clauses (i) through (vi) above or to form a group with and subject to Section 11, (B) making any counterclaim others with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, Securities or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiiiB) enter into any negotiations discussions, negotiations, arrangements or agreements with others (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in including any of its Affiliates) relating to the actions prohibited by this Section 3(c);
referred to in clauses (xivi) through (vi) above; or (viii) take any action that which would reasonably be expected to (i) require any Live Party or the Company Acquiror to make a public announcement regarding in respect of any of the actions set forth in matter contemplated by this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;12(b).
(xvc) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth Notwithstanding anything in Section 3 shall remain in effect until (or be reinstated and be applicable until12(b) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be 12(a) will not apply, solely to the extent necessary to facilitate a public or private offer by THL to enter into a Change of no further force and effect if Control transaction, upon the earlier to occur of (i) the Company enters public announcement by Acquiror of its entry into a definitive agreement providing for a Change of Control and (ii) as long as THL has not violated Section 12(b) with respect to such third Person, the public announcement by a transaction involving third Person of any tender, exchange or other offer or proposal the consummation of which would result in a Change of Control (x) the sale or transfer of all or a controlling portion an “Acquisition Proposal”); provided, however, that if any of the Company’s equity securities or all or a substantially all of the Company’s assets transactions referred to in clauses (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwisei) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) terminates and Acquiror has not made a public announcement of its intent to solicit or engage in a transaction (or has announced its decision to discontinue pursuing such a transaction) the Company adopts any plan consummation of complete or partial liquidationwhich would result in a Change of Control, dissolution, restructuring, recapitalization or other reorganization, files a petition then the restrictions contained in bankruptcy under any provisions Section 12(b) will again be applicable (for the avoidance of federal or state bankruptcy law or consents doubt prior to the filing second anniversary of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein the Closing and subject to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, foregoing clauses (i) and (ii)). Nothing in this Section 12 will preclude THL from submitting a confidential proposal to the Board or any director Chairman of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer board of the Company (who is not also directors of Acquiror for a director), with respect to any potential Change of the foregoing matters, so Control transaction as long as any such communication confidential proposal is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or not reasonably be expected to require, the Live Parties or the Company require Acquiror to make a public announcement regarding such confidential proposal. For .
(d) Notwithstanding anything in this Section 12 to the avoidance of doubtcontrary, nothing herein will preclude or restrict the Holder from entering into any hedging, derivative or other similar transactions with respect to the Registrable Securities held by the Holder, provided that such transaction does not result in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose violation of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the CompanySection 12(b).
Appears in 1 contract
Sources: Registration Rights Agreement (Lattice Semiconductor Corp)
Standstill. During You hereby agree that, from and after the Cooperation Period, each Live Party will not, date of this Agreement and will cause its Affiliates and its Representatives acting until the earliest of (i) two years after the date on behalf which discussions concerning the possibility of the Live Parties Possible Transaction have terminated, (collectively ii) the date on which the Seller or any of its subsidiaries approves or enters into an agreement with a third party that contemplates a merger, consolidation, tender offer, exchange offer or similar business combination, (each, a “Merger”), unless it can be determined based on publicly available information at the Live Partiestime of announcement of such agreement that such Merger would result in the Seller’s stockholders immediately prior to the Merger holding, the “Restricted Persons”) to notimmediately following such Merger, directly or indirectly, without at least 50% of the prior written consentvoting equity securities of either the entity resulting from such Merger or, invitationif applicable, the ultimate parent entity that directly or indirectly has beneficial ownership of all of the outstanding voting equity securities of such entity surviving the Merger, (iii) the date on which the Seller or any of its subsidiaries approves or enters into an agreement with a third party that contemplates the sale of greater than 50% of the assets of Seller or the acquisition of greater than 50% of any shares of any class of securities by Seller by tender offer, exchange offer or otherwise (each of the events listed in clauses (ii) and (iii), a “Change of Control Event”), (iv) the date on which the Seller publicly announces that it is conducting a process contemplating a Change of Control Event and (v) the date on which the parties enter into any definitive agreement contemplating a Change of Control Event, neither you nor any of your Representatives will in any manner, directly or indirectly, (a) effect, seek, offer or propose (whether publicly or otherwise), or authorization cause or participate in or in any way assist any other person to effect, seek, offer or propose (whether publicly or otherwise) to effect or participate in, (1) any acquisition of beneficial ownership of any securities or assets of the Company Seller (other than with respect to any acquisitions in the ordinary course for passive investment purposes of up to an aggregate of 1% of the outstanding securities of any class of the securities of the Seller); (2) any tender or exchange offer, merger or other business combination involving the Board:
Seller; (i3) make any public announcementrecapitalization, proposal restructuring, liquidation, dissolution or offer other extraordinary transaction with respect to the Seller; or (including 4) any “solicitation” - solicitation- of “proxies” proxies- (as such those terms are defined or used in Regulation 14A the proxy rules of the Securities and Exchange Commission) or consents to vote any voting securities of the Seller; (b) form, join or in any way participate in a “group- (as defined under the Exchange Act)), written consents ) with respect to, to any securities of the Seller or otherwise solicitact, seekalone or in concert with others, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board of Directors or the policies of the Company, including Seller; (c) take any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that action which would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company Seller to make a public announcement regarding any of the actions types of matters set forth in this Section 3(c(a) or (iib) have the purpose above; or effect of circumventing any provision of this Agreement;
(xvd) enter into any discussions or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) arrangements with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D third party with the SEC;
(xvii) make any request or submit any proposal respect to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meetingforegoing. Notwithstanding anything to the contrary in this Agreement, following the period described in the foregoing sentence, nothing in this Agreement (including the restrictions prohibitions on use and disclosure set forth in this Section 3(c)sections 2, 3 and 4 hereof) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or tradingshall, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain prevent or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, limit you or your Representatives from taking any actions referred to in clauses (Va)-(d) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreementsection 7 or related thereto, as long as and in each case without notice to or consultation with the Seller. The Seller also agrees during such private communications period not to publicly request you (or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(byour Representatives), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more to amend or waive any provision of this section (including this sentence). The Seller represents and warrants that, as of the date of this Agreement, neither you nor any of your affiliates owns, of record or beneficially, any voting securities of the Seller, or any securities convertible into or exercisable for any voting securities of the Seller (other than 25such ownership by your affiliates of up to an aggregate of 1% of the Common Stock, in the case of each of clause (x) and (ysuch securities), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 1 contract
Standstill. During (a) From and after the Cooperation Period, each Live Party will not, date of this Agreement and will cause its Affiliates and its Representatives acting for a period ending on behalf the earliest to occur of (i) five years or (ii) three years in the event that five of the Live Parties individuals who, as of the date hereof, constitute the Board of Directors of the Purchaser cease for any reason to serve on the Board; neither the Seller nor any of his Affiliates shall:
(collectively with the Live Partiesi) solicit proxies or be or become a member of a group which solicits proxies (as used herein, the “Restricted Persons”term "proxy" shall have the meaning provided in Regulation 14A promulgated by the Securities and Exchange Commission under the Exchange Act) for the purpose of (i) removing from office, or nominating or voting for a candidate to run in opposition to, any person who is serving as a director of Purchaser at the date of this Agreement or any person who may hereafter be elected to the board of directors of Purchaser as a result of the nomination or recommendation by at least a majority of those persons serving as directors of Purchaser at the date of this Agreement, or (ii) vote against or otherwise opposing any matter which has been proposed or recommended by the board of directors of Purchaser which is then comprised of persons at least a majority of which are persons serving as directors of Purchaser at the date of this Agreement and any persons who may hereafter be elected to the board of directors of Purchaser based upon the nomination or recommendation by at least a majority of those persons serving as directors of Purchaser at the date of this Agreement; or
(ii) permit any entity under his, her or its control (including but not limited to subsidiaries and employee pension, profit sharing or other trusts under his, her or its investment management control) to notacquire or offer to acquire or agree to acquire, directly or indirectly, without the prior written consentby purchase or otherwise, invitation, any Purchaser Common Stock or authorization any option to purchase Purchaser Common Stock in excess of 5 % of the Company or the Board:
total shares outstanding (i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate without regard to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;Purchase Consideration); or
(iii) make any request for stockholder list materials acquire or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access offer to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer acquire or agree to sellacquire, directly or indirectly, through swap by purchase or hedging transactions otherwise shares of Purchaser Common Stock or any option to purchase Purchaser Common Stock by any Person in excess of 5 % of the total shares outstanding (without regard to the Purchase Consideration); or
(iv) finance or arrange the financing or participate in the financing of the acquisition of Purchaser Common Stock by any Person (excluding from this subsection d any financing provided by Bank of Oklahoma, N.A.); or
(v) join or permit any Affiliate of its to join a partnership, limited partnership, syndicate, or other group (within the meaning of Section 13(d) of the Exchange Act) for the purpose of acquiring or holding Purchaser Common Stock within the meaning of Section 13(d) of the Exchange Act; or
(vi) initiate, propose or otherwise solicit shareholders for any matter at any time, or induce or attempt to induce any other Person to initiate any stockholder proposal or a tender offer for shares of Purchaser Common Stock or any change of control of Purchaser, or for the purpose of convening a stockholders' meeting of Purchaser; or
(vii) other than in connection with this Agreement, acquire or permit any entity under his, her or its control (including but not limited to subsidiaries and employee pension, profit sharing or other trusts under his, her or its investment management control) to acquire, by purchase or otherwise, all more than 5% of any class of equity securities of any entity which, prior to the time such entity acquires more than 5% of such class, is the beneficial owner of, or substantially all, voting rights decoupled from the underlying intends to acquire more than 5% of Purchaser Common Stock held by a Live Party or Affiliates of the Live Parties;Stock; or
(xiviii) institute, solicit seek or join any litigation, arbitration propose to influence or other proceeding against control Purchaser's management or involving the Company policies (or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party request information to do any of the actions set forth so). Seller will not be in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by Section 11.1(a)(viii) if he privately discusses with Purchaser the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice Purchaser's ongoing business operations or presents commercial business opportunities to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage Purchaser in the ordinary course of business; or
(ix) enter into discussions, which lien negotiations, arrangements or encumbrance is released upon the transfer of such claim or interest in accordance understandings with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately third party with respect to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Personsforegoing; or
(x) transfer more than five percent of the Purchaser's outstanding Common Stock to a single person or group (as that term is used in Section 13 of the Securities Exchange Act of 1934, as amended) without obtaining from such transferee a commitment or agreement subjecting such persons to the restrictions set forth in this Section 11.1; or
(VIIb) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, for 2 years after the restrictions set forth in date of this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to Seller and his Affiliates will vote all their shares of Purchaser Common Stock in accordance with the recommendation made by the Board at the 2025 Annual Meeting and (ii) apply to any of Directors of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisorPurchaser, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement except with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, matters concerning compensation and rights plans in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition such manner as Seller shall determine in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companyhis sole discretion.
Appears in 1 contract
Sources: Stock Purchase Agreement (Unit Corp)
Standstill. During the Cooperation period beginning on the date hereof and ending on the earliest to occur of (A) the tenth anniversary of the Effective Date, (B) the date on which the Stockholders own, collectively, Voting Securities which would represent less than 10% of the voting power in the general election of directors of the Company, on a fully diluted basis, of all Voting Securities then outstanding or (C) a Termination Event under any subdivision of Section 5.2 (such period, the "Standstill Period"), each Live Party Stockholder will not, and will cause each of its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notnot to, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) make except with the prior approval of two-thirds of the entire Board of Directors (which approval is requested in a manner which does not require disclosure publicly or to any public announcementthird parties) acquire, proposal offer to acquire (by tender or exchange offer or otherwise), or agree to acquire, by purchase or otherwise, beneficial ownership of any Voting Securities or voting rights or direct or indirect rights or options to acquire any Voting Securities of the Company or any of its Affiliates other than (A) the exercise of convertible securities acquired in compliance with the terms of this Agreement, or an acquisition as a result of a stock split, stock dividend or similar recapitalization, (B) the acquisition of shares of Common Stock pursuant to the Merger Agreement or the GranCare Merger Agreement, (C) acquisitions of Voting Securities provided that the aggregate number of Voting Securities beneficially owned by all Stockholders and their Affiliates (including the Shares) after giving effect to such acquisitions does not exceed 49% of the Total Shares Outstanding; (D) stock options or similar rights granted by the Company to an Affiliate of such Stockholder as compensation for performance as a director or officer of the Company or its subsidiaries (and any “shares issuable upon exercise thereof), (E) transfers among Stockholders or (F) any rights which are granted to all stockholders of the Company (and any share issuable upon exercise thereof); provided, however, that if the Stockholders or any of their Affiliates in good faith inadvertently acquire not more than 100,000 shares of Common Stock in violation of these provisions and within 15 days after the first date on which the Stockholders have actual knowledge (including by way of written notice given by the Company) that a violation has occurred, the Stockholders or any of their Affiliates shall have transferred any shares of Common Stock held in violation of these provisions to unrelated third parties so that the Stockholders and their Affiliates no longer beneficially own any such shares or have any agreement or understanding relating to such shares, this Section 5.1 shall be deemed not to have been violated; and provided further, that no violation of this provision shall be deemed to have occurred by reason of the indirect acquisition of beneficial ownership of securities resulting from (aa) investments in investment funds as to which no Stockholder or Affiliate thereof has control or power to control with respect to voting or investment decisions or (bb) acquisitions of securities by a limited partner in any Stockholder or Affiliates thereof as to which limited partner no Stockholder or its Affiliates has control or power to control;
(ii) except pursuant to this Agreement or the Proxy Agreement, form, join or in any way participate in a Group with respect to any securities of the Company or its Affiliates, other than with other Stockholders or Affiliates or Associates of any Stockholder or Ares Leveraged Investment Fund, L.P., provided, however, that in the case of securities other than Voting Securities, Stockholders may participate in a Group with respect thereto with the prior approval of two-thirds of the entire Board of Directors (which approval is requested in a manner which does not require disclosure publicly or to any third party);
(iii) grant a proxy to any Person other than (I) an Affiliate or Associate of a Stockholder; provided that any such Person shall not, pursuant to the grant of such proxy or otherwise, have the right or ability to vote shares of Common Stock representing 50% or more of the Total Shares Outstanding, (II) the proxy granted to Apollo pursuant to the Proxy Agreement or (III) proxies designated by the Board of Directors of the Company in connection with any contested election, or otherwise make, or in any way cause or participate in, any "solicitation” " of “"proxies” " to vote (as such those terms are defined in Regulation 14A under the Exchange Act) with respect to the Company or its Affiliates, or communicate with, seek to advise, encourage or influence any Person, in any manner, with respect to the voting of, securities of the Company or its Affiliates, or become a "participant" in any "election contest" (as those terms are defined or used in Regulation 14A of Rule 14a-11 under the Exchange Act)), written consents ) with respect to, to the Company or otherwise solicit, seek, cause, offer or offer to effect, its Affiliates (other than (A) any proposal to seek representation on the Board nonpublic communications with other Stockholders or otherwise seek to control Affiliates or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling Associates of any vacancy on the Board Stockholder which would not require public disclosure by any Person or (B) with the prior approval of a two thirds majority of the entire Board of Directors (which approval is requested in a manner which does not require disclosure publicly or to any public third party));
(iv) initiate, propose or, except with the prior approval of two- thirds of the entire Board of Directors (which approval is requested in a manner which does not require disclosure publicly or to any third parties) otherwise solicit stockholders for the approval of one or more stockholder proposals with respect to the Company or its Affiliates or induce or attempt to induce any other Person to initiate any stockholder proposal or other statement that is directly contrary seek election to (or may require seek to place a representative on the Board of Directors of the Company (except pursuant to waive) any of the terms Section 4.1 of this Agreement;
(ii) seek, alone or in concert with one its Affiliates or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, seek the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records Directors of the Company or its Affiliates;
Affiliates (iv) engage in any “solicitation” (as such term is used in for this purpose, the proxy rules actions of the SEC, but including, notwithstanding anything Stockholder Designees in communicating (without public disclosure or disclosure to third parties) with the contrary Board of Directors in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more their capacity as directors of the Company Company, and non-public communication by a Stockholder with other Stockholders or Affiliates of any other matter or proposal relating Stockholder which would not require public disclosure by any Person, shall not be deemed to the Company or become a “participant” be in contravention of this paragraph (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;iv)); or
(v) disclose to make any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person announcement with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive for, any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and transaction involving the Company, (II) making on the one hand, and Apollo or any factual statement to comply with any subpoena or Affiliates of Apollo, on the other legal process or respond to hand, which would be deemed a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result "business combination" under the provisions of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contractSection 203(c)(3)(i)-(iv) of the existenceDGCL, terms, and circumstances surrounding whether or not such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of proposal might require public disclosure by the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as unless such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy proposal is directed and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) disclosed solely to the extent directed Board. provided, that this Section 5.1 shall not restrict or permitted by inhibit the Board, any officer rights of a Stockholder to exercise its voting rights as a stockholder of the Company (who is not also a directorsubject to Section 4.2), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 1 contract
Sources: Stockholders Agreement (Mariner Post Acute Network Inc)
Standstill. During (a) The Investor agrees that, from the Cooperation date of this Agreement until the expiration of the Standstill Period, each Live Party will notneither it nor any of its Affiliates or Associates will, and it will cause each of its Affiliates Affiliates, Associates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notrepresentatives not to, directly or indirectly, without the prior written consentin any manner, invitation, acting alone or authorization of the Company or the Boardin concert with others:
(i) make submit any public announcementstockholder proposal (pursuant to Rule 14a-8 promulgated by the SEC under the Securities Exchange Act of 1934, proposal as amended (the “Exchange Act”) or offer otherwise) or any notice of nomination or other business for consideration, or nominate any candidate for election to the Board (including any “solicitation” by way of “proxies” (as such terms are defined or used in Rule 14a-11 of Regulation 14A of the Exchange Act)14A), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of than as expressly permitted by this Agreement;
(ii) seekengage in, alone directly or in concert with one or more Third Partiesindirectly, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary defined in Rule 14a-2 under the Exchange Act, solicitations 14a-1 of ten Regulation 14A) of proxies (10or written consents) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participantparticipant in a solicitation” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A of Regulation 14A under the Exchange Act) in opposition to the recommendation or proposal of the Board, or recommend or request or induce or attempt to induce any other person to take any such solicitation actions, or seek to advise, encourage or influence any other person with respect to the voting of the Common Stock or grant a proxy with respect to the voting of the Common Stock or other voting securities to any person other than to the Board or persons appointed as proxies or consentsby the Board; provided, however, that except as set forth in Section 3 and this Section 4, nothing herein shall be interpreted to restrict the Investor’s ability to vote its shares on any proposal duly brought before the Company’s shareholders as the Investor determines in its sole discretion;
(viii) disclose seek to call, or to request the call of, a special meeting of the Company’s stockholders, or make a request for a list of the Company’s stockholders or for any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent books and records of the Company;
(viiv) knowingly encourage take any action (including making any proposal to act) by written consent;
(v) form, join in or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating toway participate in a “partnership, limited partnership, syndicate or other authority to vote, any Voting Securities, or (Bgroup” within the meaning of Section 13(d)(3) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, Exchange Act with respect to the Company’s management Common Stock or the Board)deposit any shares of Common Stock in a voting trust or similar arrangement or subject any shares of Common Stock to any voting agreement or pooling arrangement, other than to the extent such encouragement or advice that is consistent a group may be deemed to result with the Board’s recommendation in connection with such matter, Company or any of its Affiliates or Associates as otherwise expressly permitted by a result of this Agreement;
(viivi) form, join, knowingly encourage vote for any nominee or knowingly participate in or knowingly act in concert with any Group with respect nominees for election to any Voting Securitiesthe Board, other than solely with Affiliates of those nominated or supported by the Live Parties with respect to Voting Securities now or hereafter owned by themBoard;
(viiivii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts except as specifically provided in Section 2 and the like), in each case other than (A) Section 3 of this Agreement, (B) solely between seek to place a representative or among the Live Parties and their Affiliatesother Affiliate, Associate or (C) granting any proxy in any solicitation approved by nominee on the Board and consistent with or seek the recommendation removal of any member of the Board or a change in the size or composition of the Board;
(ixviii) engage in any short sale acquire or any purchaseagree, saleoffer, seek or propose to acquire, or grant of any optioncause to be acquired, warrant, convertible security, share appreciation right, or other similar right ownership (including any put or call option or “swap” transactionbeneficial ownership) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate assets or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates business of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current rights or former directors options to acquire any such assets or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent business from any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal processperson;
(xiiix) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any than at the direction of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) withBoard seek, or advisepropose, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c)with respect to, or make any investment in or enter into any agreement with any other person that engagessolicit, negotiate with, or offers or proposes provide any information to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), person with respect to an Extraordinary Transaction between the Live Parties and the Companyto, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, acquisition of control or other business combination, tender or exchange offer, recapitalizationpurchase, restructuring, sale, equity issuance sale or otherwise) transfer of assets or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidationsecurities, dissolution, restructuringliquidation, recapitalization or other reorganization, files a petition change in bankruptcy under any provisions structure or composition of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to Board, change in the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director executive officers of the Company, change in capital structure, recapitalization, dividend, share repurchase or similar transaction involving the Company, its subsidiaries or its business, whether or not any such transaction involves a change of control of the Company.
(ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iiix) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to requirean Opposition Matter, the Live Parties Investor shall have the right to solicit in opposition, and otherwise campaign publicly or the Company privately against, any Opposition Matter and shall be free to make a public announcement regarding such proposal. For the avoidance of doubt, nothing engage in this Agreement shall prevent or limit the Live Parties or their respective Affiliates communications with shareholders and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.third
Appears in 1 contract
Standstill. During Each Holder hereby agrees that, from the Cooperation PeriodClosing Date until the Standstill Termination Date, each Live Party will unless an exemption or waiver is otherwise approved in advance in writing by the Board, such Holder shall not, and will shall cause its Affiliates and its Representatives acting on behalf of the Live Parties Restricted Party not to:
(collectively with the Live Partiesa) purchase or otherwise acquire, the “Restricted Persons”) offer or propose to notacquire, or solicit an offer to sell or agree to acquire, directly or indirectly, without alone or in concert with others, Beneficial Ownership of any Capital Stock or any Derivative Securities (excluding shares and securities received by way of stock dividend, stock reclassification or other distributions or offerings made available on a pro rata basis to the prior written consentCompany’s stockholders) if, invitationafter giving effect thereto, the Holders and the Restricted Party would collectively Beneficially Own, in the aggregate, an amount of Capital Stock, including any Derivative Securities on an as-exercised, converted or exchanged basis, as applicable, in excess of the Stockholder Threshold; provided, however, that, if as a result of a reduction in the number of shares of Common Stock outstanding due to the repurchase of shares of Common Stock by the Company, the Holders and the Restricted Party collectively Beneficially Own, in the aggregate, an amount of Capital Stock, including any Derivative Securities on an as-exercised, converted or exchanged basis, as applicable, in excess of the Stockholder Threshold, the Holders and the Restricted Party shall not be in violation of this Section 3.1(a) so long as the Holders and the Restricted Party do not take any of the actions referred to in the first clause of this Section 3.1(a);
(b) make, or authorization of the Company in any way participate in, directly or the Board:
(i) make any public announcementindirectly, proposal alone or offer in concert with others (including by or through any group), any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of under the Exchange Act))) to vote Common Stock or other Capital Stock of the Company or to provide or withhold consents with respect to Common Stock or other Capital Stock of the Company, written consents whether subject to or exempt from the proxy rules, or seek to advise or influence any Person or entity with respect to the voting of, or the providing or withholding consent with respect to, any Common Stock or other Capital Stock of the Company; provided, however, that the foregoing will not be deemed to restrict or limit in any manner in which any of the Holders or the Restricted Party votes any of its respective shares of Common Stock or Capital Stock, directly or by proxy, subject to compliance with the other terms and conditions of this Agreement;
(c) except as permitted by Section 3.2, either directly or indirectly in concert with others (including by or through any group) make any offer with respect to, or otherwise solicitmake or submit a proposal with respect to, seek, cause, or ask or request any other Person to make an offer or proposal with respect to, any transaction that would, if consummated, be reasonably likely to result in a change of control of the Company, including a merger, business combination, restructuring, reorganization, recapitalization, tender or exchange offer or asset disposition involving the Company or any of its Affiliates; provided, however, that the Holders and the Restricted Party shall be permitted to effect, (i) vote on any such transaction in accordance with the terms and conditions of this Agreement and (ii) tender into any tender offer or exchange offer not commenced by a Holder or the Restricted Party if either (A) the Board recommends (by majority vote) that the stockholders of the Company tender their shares in response to such offer or does not recommend against the tender offer or exchange offer within 10 Business Days after the commencement thereof or such longer period as shall then be permitted under U.S. federal securities laws or (B) the Board later publicly recommends (by majority vote) that the stockholders of the Company tender their shares in response to such offer;
(d) except as provided in this Agreement, either directly or indirectly in concert with others (including by or through any proposal to group) seek representation on the Board or otherwise the board of directors (or equivalent governing body) of any of the Company’s controlled Affiliates, seek to control or influence the management, remove any members of the Board or expand or reduce the policies size of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, otherwise act alone or in concert with one others (including by or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention through any group) to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member seek control of the Board or initiate, encourage the board of directors (or participate in equivalent governing body) of any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Company’s controlled Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(viie) form, join, knowingly encourage the formation of or knowingly engage in discussions relating to the formation of, or participate in in, a “group” within the meaning of Section 13(d)(3) of the Exchange Act for purposes of seeking control, or knowingly act influencing the control or management of, the Company; or
(f) either directly or indirectly in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist others (including by providing or arranging financing or other services forthrough any group) publicly announce any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) withintention, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into or disclose any agreement with any other person that engages, plan or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D inconsistent with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement foregoing (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board waive, amend or (iii) solely to the extent directed or permitted by the Board, terminate any officer provisions of the Company (who is not also a directorthis Section 3.1), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 1 contract
Standstill. During (a) For a period ending on the Cooperation Period, each Live Party will not, and will cause its Affiliates and its Representatives acting date on behalf which Quicksilver ceases to hold at least 10% of the Live Parties units, Quicksilver will agree to the following standstill provisions that prohibit Quicksilver from:
(collectively i) engaging in any hostile/takeover activities (including tender offer; soliciting proxies or written consents - other than as recommended by the Board);
(ii) acquiring or proposing to acquire additional units, securities or properties of BreitBurn, except pursuant to a distribution, reclassification or reorganization involving BreitBurn or its units or other securities approved by the Board;
(iii) calling a special meeting of the unitholders; or
(iv) proposing to remove the GP or voting for removal of the GP other than in accordance with paragraph 12.
(b) Specifics. Without the Live Partiesprior written consent of BreitBurn, the “Restricted Persons”) to Quicksilver will not, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) acquire any securities or property of BreitBurn (or its affiliates), except pursuant to a distribution, reclassification or reorganization involving BreitBurn or its units or other securities approved by the Board;
(ii) propose to enter into (directly or indirectly) any merger/consolidation/recap/business combination/partnership/JV, etc. involving BreitBurn (or its affiliates), except as permitted hereby;
(iii) make or in any public announcement, proposal way participate in any solicitation of proxies (per SEC’s proxy rules) or offer written consents to vote/seek to influence/advise others with respect to the voting BreitBurn’s (including any or its affiliates’) voting securities;
(iv) form/join/participate in a “solicitation” of “proxiesgroup” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents per SEC’s Sec 13(d) rules/defs) with respect to, to any voting securities of BreitBurn (or otherwise solicit, seek, cause, offer or offer its affiliates);
(v) act to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the /Board/policies of BreitBurn except through Quicksilver’s Board designees or as provided below;
(vi) propose to remove the CompanyGP of BreitBurn or, including other than in accordance with paragraph 12, vote to remove the GP;
(vii) publicly disclose any change intent/plan/arrangement inconsistent with this agreement; or
(viii) advise/assist/encourage others in connection with the number above.
(c) Quicksilver will agree not to sell/transfer its units without the prior written consent of directors serving on the Board or the filling of any vacancy on the Board or BreitBurn, except:
(Bi) any public proposal or other statement to a party that is directly contrary to (or may require the Company to waive) any would not own more than 20% of the terms of this Agreementoutstanding units after such transfer;
(ii) seek, alone or in concert connection with one or more Third Parties, election or appointment to, or representation on, a business combination approved by the Board or publicly nominate, indicate an intention to nominate, or propose and/or the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholdersBreitBurn unitholders;
(iii) make in a pledge of any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access voting securities to books and records of the Company or its Affiliates;a financial institution/brokerage firm; or
(iv) engage in an underwritten offering where the units will be widely distributed or would not result in any “solicitation” (as purchaser in such term is used in the proxy rules offering owning more than 20% of the SECoutstanding units after the offering.
(d) The foregoing provisions shall not, but includingand are not intended to:
(i) prohibit Quicksilver from privately communicating with, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or including making any other matter offer or proposal relating to to, the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consentsBoard;
(vii) disclose restrict in any manner how Quicksilver votes its units, except as provided in paragraphs 11 and 12;
(iii) restrict the manner in which Quicksilver’s designees to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any the Board (A) may vote as to on any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote Board or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securitiesunitholders, or (B) conducting any type participate in deliberations or discussions of referendum relating the Board (including making suggestions or raising issues to the Company (including, for the avoidance Board) in their capacity as members of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved may take actions required by their exercise of legal duties and obligations as members of the Board or refrain from taking any action prohibited by their legal duties and consistent with the recommendation obligations as members of the Board;; or
(ixiv) engage in any short sale restrict Quicksilver from selling or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or transferring any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect units to any proceeding initiated by, affiliate or on behalf of, successor of Quicksilver which agrees to be bound by the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;standstill agreement.
(xiie) knowingly instigate, cooperate with The provisions contained in paragraph 9 shall immediately and automatically be suspended upon the increase or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event acceleration of a material financial obligation of BreitBurn that results from the breach of this Agreement a material provision thereof or the occurrence of a material event of default thereunder, unless such breach is caused solely by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company action or inaction of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given Quicksilver or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companydirectors.
Appears in 1 contract
Sources: Settlement Agreement (BreitBurn Energy Partners L.P.)
Standstill. During Except as otherwise provided in this Agreement, without the Cooperation Periodprior written consent of the Board, each Live Party will the Stockholders shall not, and will cause its Affiliates and its Representatives acting on behalf shall instruct their Affiliates, not to, directly or indirectly (in each case, except as permitted by this Agreement):
(a) (i) acquire, offer or agree to acquire, or acquire rights to acquire (except by way of stock dividends or other distributions or offerings made available to holders of voting securities of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notCompany generally on a pro rata basis), directly or indirectly, without whether by purchase, tender or exchange offer, through the prior written consentacquisition of control of another person, invitationby joining a group, through swap or authorization hedging transactions or otherwise, any voting securities of the Company or any voting rights decoupled from the Board:underlying voting securities which would result in the ownership or control of, or other beneficial ownership interest in, more than 17.5% of the then-outstanding shares of the Common Stock in the aggregate; or (ii) other than in open market sale transactions where the identity of the purchaser is not known or in underwritten widely dispersed public offerings, knowingly sell, offer or agree to sell, through swap or hedging transactions or otherwise, the voting securities of the Company or any voting rights decoupled from the underlying voting securities held by the Stockholders to any Third Party that has, or would have as a result of such transaction, a beneficial ownership interest of 5.0% or more of the then-outstanding shares of Common Stock;
(b) (i) make nominate or publicly recommend for nomination a person for election at any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of Stockholder Meeting at which the Company, including any change in the number of ’s directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary are to (or may require the Company to waive) any of the terms of this Agreement;
be elected; (ii) seekinitiate, alone encourage or participate in concert any solicitation of proxies in respect of any election contest or removal contest with one or more Third Parties, election or appointment torespect to the Company’s directors; (iii) submit any stockholder proposal for consideration at, or representation onbring any other business before, the Board any Stockholder Meeting; (iv) initiate, encourage or publicly nominate, indicate an intention to nominateparticipate in any solicitation of proxies in respect of any stockholder proposal for consideration at, or propose the nomination of, or recommend the nomination ofother business brought before, any candidate to the Board, seek, alone Stockholder Meeting; or in concert with others, the removal of any member of the Board or (v) initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholdersStockholder Meeting;
(iiic) make form, join or in any request for way participate in any group or agreement of any kind with respect to any voting securities of the Company in connection with any election or removal contest with respect to the Company’s directors or any stockholder list materials proposal or other business brought before any Stockholder Meeting (other than with the Stockholders or one or more of their Affiliates that agree to be bound by the terms and conditions of this Agreement);
(d) deposit any voting securities of the Company in any voting trust or subject any Company voting securities to any arrangement or agreement with respect to the voting thereof (other than any such voting trust, arrangement or agreement solely among the Stockholders and their Affiliates and otherwise in accordance with this Agreement);
(e) seek publicly, alone or in concert with others, to amend any provision of the Company’s articles of incorporation or bylaws;
(f) demand an inspection of the Company’s books and records records;
(g) effect or seek to effect, offer or propose to effect, cause or participate in, or in any way assist or facilitate any other person to effect or seek, offer or propose to effect or participate in, any (i) material acquisition of any securities, or any material assets or businesses, of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law subsidiaries; (ii) tender offer or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SECexchange offer, but includingmerger, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Actacquisition, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, share exchange or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of business combination involving any of the Company’s voting securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates any of the Live Parties;
(xi) institute, solicit material assets or join any litigation, arbitration or other proceeding against or involving businesses of the Company or any of its subsidiaries; or (iii) recapitalization, its current restructuring, liquidation, dissolution or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim extraordinary transaction with respect to any proceeding initiated by, or on behalf of, the Company or any of its Affiliates against subsidiaries or any Live Partymaterial portion of its or their businesses (each, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal processan “Extraordinary Transaction”);
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiiih) enter into any negotiations discussions, negotiations, agreements or agreements (whether written or oral) withunderstandings with any Third Party with respect to the foregoing, or advise, finance, assist, encourage or seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes respect to engage, in any of the actions prohibited by this Section 3(c)foregoing, or otherwise take or cause any action inconsistent with any of the foregoing;
(xiv) take any action that would reasonably be expected to (i) require publicly make or in any Live Party way advance publicly any request or proposal that the Company or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) Board amend, modify or (ii) have the purpose or effect of circumventing waive any provision of this Agreement;; or
(xvj) enter into take any action challenging the validity or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms enforceability of this Agreement (including Section 3 or this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth Agreement. Nothing in Section 3 shall remain in effect until be deemed to (i) prohibit the Stockholders or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under their Affiliates from communicating privately with the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreementdirectors, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, termsofficers, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, Representatives so long as such private communications would not be reasonably be expected determined to require trigger public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated obligations for election to the Board at the 2025 Annual Meeting and any party; (ii) apply to any limit the exercise in good faith by the Designee of the Live Parties’ Representatives effecting her or recommending transactions his fiduciary duties solely in securities (x) in the ordinary course of its business her or his capacity as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board ; or (iii) solely prevent the Stockholders from making any private statement to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication an Extraordinary Transaction that is (x) not released publicly announced by the Live Parties Company or their Representatives or any a Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the CompanyParty.
Appears in 1 contract
Sources: Board Representation and Standstill Agreement (Stratus Properties Inc)
Standstill. During (a) Until the Cooperation Periodlater of (x) the three (3) year anniversary of the Closing, and (y) the date on which the Majority Approved Holders are no longer entitled to designate any director for nomination pursuant to Section 1.1 (or have irrevocably waived their right), each Live Party will notStockholder agrees that, and will cause its Affiliates and its Representatives acting on behalf without the prior approval of the Live Parties Board, such Stockholder will not (collectively in its own capacity or with the Live Partiesor through any other Person), the “Restricted Persons”directly or indirectly:
(i) acquire, offer or propose to notacquire, solicit an offer to sell or agree to acquire, directly or indirectly, without alone or in concert with others, by purchase or otherwise, any direct or indirect “beneficial ownership” (as defined in Rule 13d-3 and Rule 13d-5 under the prior written consent, invitation, or authorization Exchange Act) of any securities of the Company or its Subsidiaries, including shares of Common Stock, any securities convertible or exchangeable into shares of Common Stock or direct or indirect rights, warrants or options to acquire, or securities convertible into or exchangeable for, any voting securities of the Board:Company or any of its Subsidiaries, excluding any shares of Common Stock or other securities acquired (A) pursuant to a conversion or redemption of any shares of Series A Preferred Stock, bonus issue, dividend or distribution by the Company or otherwise acquired pursuant to the Transaction Documents (as defined in the Investment Agreement), or (B) by a Person from the Company in connection with such Person’s service as a director or Board observer;
(iii) make except as otherwise expressly provided in this Agreement, make, or in any public announcementway knowingly encourage or participate in, proposal directly or offer (including indirectly, alone or in concert with others, any “solicitation” of “proxies” to vote (as such terms are defined or used in Regulation 14A the proxy rules of the SEC promulgated pursuant to Section 14 of the Exchange Act)), written consents any securities of the Company or any of its Subsidiaries (whether or not any such vote relates to the election or removal of directors) whether subject to or exempt from the federal proxy rules, seek to advise or influence in any manner whatsoever any Person with respect to, to the voting of any securities of the Company or otherwise solicit, seek, cause, offer any of its Subsidiaries or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to propose to influence, advise, change or control or influence the management, the Board board of directors (or the policies similar governing body), policies, affairs or strategy of the Company, including Company or any change in the number of directors serving on the Board or the filling its Subsidiaries by way of any vacancy on the Board or (B) any public proposal communication or other statement that is directly contrary communications to (or may require the Company to waive) any of the terms of this Agreementtheir respective equityholders intended for such purpose;
(iiiii) seekexcept as otherwise expressly provided in this Agreement or as required in connection with the consummation of the transactions contemplated by the Investment Agreement, form, join or in any way participate or act in a “group” (as such term is used in Section 13(d)(3) of the Exchange Act) with respect to any voting securities of the Company or any of its Subsidiaries;
(iv) acquire, offer to acquire or agree to acquire, directly or indirectly, alone or in concert with one others, by purchase, exchange or more Third Partiesotherwise, election (A) any of the assets (tangible or appointment tointangible) of the Company or any of its Subsidiaries, or representation on(B) any direct or indirect right, warrant or option to acquire any asset of the Board Company or publicly nominateany of its Subsidiaries, indicate an intention to nominateexcept in the event any such asset as is then being offered for sale by the Company or any of its Subsidiaries;
(v) arrange, or in any way participate, directly or indirectly, in any financing for the purchase of any securities or assets of the Company or any of its Subsidiaries or any securities convertible into or exchangeable or exercisable for any securities or assets of the Company or any of its Subsidiaries, except for such securities or assets as are then being offered for sale by the Company or any of its Subsidiaries;
(vi) act, alone or in concert with others, to make any public announcement or seek to propose (in each case, with or without any condition) to the nomination of, or recommend the nomination ofCompany, any candidate of its Subsidiaries or any of their respective equityholders any amalgamation, merger, business combination, tender or exchange offer, restructuring, recapitalization, liquidation of or other similar transaction to or with the Board, Company or any such Subsidiary (or in respect of any securities of the Company or any of its Subsidiaries) or otherwise seek, alone or in concert with others, to control, change or influence the removal management, board of any member of the Board directors or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records policies of the Company or any of its subsidiaries under Section 220 of such Subsidiary or nominate any Person as a director who is not nominated by the Delaware General Corporation Law then-incumbent Board, or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to propose any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted voted upon by the prior written consent stockholders of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) formmake any request or proposal to amend, join, knowingly encourage waive or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing terminate any provision of this Agreement;Section 2.2(a); provided that this clause shall not prohibit a Stockholder from making a confidential request or proposal to the Chief Executive Officer or Chair of the Board seeking any amendment or waiver of any provision of this Section 2.2, which the Company may accept or reject in its sole discretion, so long as any such request is made in a manner that does not require public disclosure thereof; or
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xivviii) take any action that would reasonably be expected to (i) require any Live Party or might result in the Company having to make a public announcement regarding any of the actions set forth matters referred to in clauses (i) - (vii) of this Section 3(c) 2.2(a), or (ii) have the purpose announce any intention to do, or effect of circumventing any provision of this Agreement;
(xv) enter into any arrangement, understanding or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) discussion with any director of the Company one or nominee for director of the Company;
(xvi) except as required by applicable lawmore other Persons to do, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms actions restricted or prohibited under clauses (i)—(vii) of this Agreement Section 2.2(a).
(including this subclauseb) Nothing in Section 2.2(a) will limit the Stockholders’ ability to vote (subject to Section 1.2 above), in each case publicly or that would reasonably be expected Transfer (subject to give rise Section 2.3 below), convert (subject to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c(C) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end Article VII of the notice period); provided, further, that in Series A Certificate) or otherwise exercise the event that rights of its shares of Common Stock or shares of Series A Preferred Stock or the Board nominates ability of the New Director for election Stockholders’ director designee elected to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth 1.1 to vote or otherwise exercise its legal duties or otherwise act in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise its capacity as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman member of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 1 contract
Sources: Equity Commitment and Investment Agreement (Catalent, Inc.)
Standstill. During Each Investor agrees that, for the Cooperation period commencing on the date of this Agreement and ending on the earliest of (i) the thirtieth (30th) calendar day preceding the opening of the nomination window for submission of director nominees at the Company’s 2021 Annual Meeting, (ii) a material breach by the Company of its obligations under this Agreement which is not cured within five (5) business days after written notice from any Investor, (iii) an announcement by the Company of any type of transaction involving a change of control in the Company and (iv) the adoption by the Board of any amendment to any of the organizational documents of the Company that would impair the ability of stockholders to submit director nominations in connection with stockholder meetings after the 2020 Annual Meeting (the “Standstill Period”), each Live Party will notneither it nor any of its Affiliates will, and it will cause each of its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notnot to, directly or indirectly, without the prior written consentin any manner other than pursuant to Section 6(c), invitation, acting alone or authorization of the Company or the Boardin concert with others:
(i) make submit any public announcementstockholder proposal (pursuant to Rule 14a-8 promulgated by the SEC under the Exchange Act or otherwise) or any notice of nomination or other business for consideration, proposal or offer nominate any candidate for election to the Board (including any “solicitation” by way of “proxies” (as such terms are defined or used in Rule 14a-11 of Regulation 14A of the Exchange Act)14A), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of than as expressly permitted by this Agreement;
(ii) seekengage in, alone directly or in concert with one or more Third Partiesindirectly, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary defined in Rule 14a-2 under the Exchange Act, solicitations 14a-1 of ten Regulation 14A) of proxies (10or written consents) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participantparticipant in a solicitation” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A of Regulation 14A under the Exchange Act) in opposition to the recommendation or proposal of the Board, or recommend or request or induce or attempt to induce any other person to take any such solicitation actions, or seek to advise, encourage or influence any other person with respect to the voting of the Common Stock (including any withholding from voting) or grant a proxy with respect to the voting of the Common Stock or other voting securities to any person other than to the Board or persons appointed as proxies or consentsby the Board;
(viii) disclose seek to call, or to request the call of, a special meeting of the Company’s stockholders, or make a request for a list of the Company’s stockholders or for any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent books and records of the Company;
(viiv) knowingly encourage form, join in or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating toway participate in a “partnership, limited partnership, syndicate or other authority to vote, any Voting Securities, or (Bgroup” within the meaning of Section 13(d)(3) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, Exchange Act with respect to the Company’s management Common Stock or the Board)deposit any shares of Common Stock in a voting trust or similar arrangement or subject any shares of Common Stock to any voting agreement or pooling arrangement, other than such encouragement a group consisting only of some or advice that is consistent with all of the Investors and their Affiliates;
(v) vote for any nominee or nominees for election to the Board’s recommendation , other than those nominated or supported by the Board;
(vi) except as specifically provided in connection with such matter, or as otherwise expressly permitted by Section 1 and Section 2 of this Agreement, seek to place a representative or other Affiliate or nominee on the Board or seek the removal of any member of the Board or a change in the size or composition of the Board;
(vii) formacquire or agree, joinoffer, knowingly encourage seek or knowingly participate in propose to acquire, or knowingly act in concert with cause to be acquired, ownership (including beneficial ownership) of any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect assets or business of the Company or any rights or options to Voting Securities now acquire any such assets or hereafter owned by them;
(viii) enter into business from any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like)person, in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xviviii) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement other than at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman direction of the Board, seek, propose or make any statement (other than to one or more members of the Company’s Chief Executive Officer, Chief Financial OfficerBoard or management or its advisors or agents) with respect to, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communicationssolicit, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply negotiate with or provide any information to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement person with respect to to, a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, acquisition of control or other business combination, tender or exchange offer, purchase, sale or transfer of assets or securities, dissolution, liquidation, reorganization, change in structure or composition of the Board, change in the executive officers of the Company, change in capital structure, recapitalization, restructuringdividend, saleshare repurchase or similar transaction involving the Company, equity issuance its subsidiaries or otherwiseits business, whether or not any such transaction involves a change of control of the Company (it being understood that the foregoing shall not restrict the Investors from tendering Common Stock, receiving payment for Common Stock or otherwise participating in any such transaction on the same basis as other stockholders of the Company, or from participating in any such transaction that has been approved by the Board);
(ix) acquire, announce an intention to acquire, offer or (y) the issuance of securities representing propose to acquire, or convertible into or exchangeable or exercisable foragree to acquire, directly or indirectly, by purchase or otherwise, beneficial ownership of (A) any interests in the Company’s indebtedness or (B) an aggregate amount of more than 2514.99% of the Company’s outstanding Common StockStock (which shall not include Common Stock issued in connection with a stock split, in the case of each of clause (x) and (y), with any Person other than a Live Party stock dividend or an Affiliate of the Live Parties or (ii) similar corporate action initiated by the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any securities beneficially owned by any of the foregoing mattersInvestors or their Affiliates); provided, so long as however, nothing herein shall prevent any such communication is Investor from confidentially seeking a waiver from this provision;
(x) not released publicly short sell the Company’s capital stock, or otherwise pledge, hypothecate or put any liens against the Company’s capital stock, except that an Investor may partake in customary margin transactions with a broker regulated by the Live Parties FINRA;
(xi) disclose publicly, or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made privately in a manner that would require, or could reasonably be expected to requirebecome public, the Live Parties any intention, plan or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working arrangement inconsistent with the Live Parties foregoing;
(xii) take any action challenging the validity or enforceability of any provisions of this Section 3; or
(xiii) enter into any agreement, arrangement or understanding concerning any of the Live Parties’ foregoing (other Representatives for than this Agreement) or encourage or solicit any person to undertake any of the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companyforegoing activities.
Appears in 1 contract
Standstill. During (a) The Stockholder agrees that, until the Cooperation Periodtermination of this Agreement pursuant to Section 3, each Live Party will without the prior invitation or written consent of the Board acting by a majority vote of disinterested directors that (i) are unaffiliated with the Stockholder, and (ii) were not nominated by the Stockholder ((i) and (ii), the “Unaffiliated Directors”)), the Stockholder shall not, and will shall cause its Affiliates each of his affiliates and its associates and his and their respective Representatives acting on his or their behalf of the Live Parties (collectively with the Live PartiesStockholder, the “Restricted Persons”) to notnot to, directly or indirectlyindirectly effect or seek, without the prior written consentoffer or propose (whether publicly or otherwise) to effect, invitationannounce any intention to effect, cause, or authorization of the Company or the Boardparticipate in:
(i) make any public announcement, proposal or offer (including any “solicitation” voluntary acquisition of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal securities (or beneficial ownership thereof), or rights or options to seek representation on the Board acquire any securities (or otherwise seek to control or influence the management, the Board or the policies beneficial ownership thereof) of the CompanyCompany (other than any voluntary acquisition by one Restricted Person of any securities from another Restricted Person) in each case, including any change if such acquisition would result in the number Stockholder acquiring beneficial ownership of directors serving on the Board or the filling more than an additional 4,000,000 shares of any vacancy on the Board Company’s common stock outstanding at such time, or (B) any public proposal assets, indebtedness or other statement businesses of, the Company; provided, that is directly contrary to the foregoing shall not restrict (x) the acquisition of securities received as compensation for service on the Board or may require any committee thereof, or (y) transfers of securities among the Company to waive) any of Stockholder and the terms of this AgreementStockholder’s affiliated persons which does not change the Stockholder’s beneficial ownership;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholdersExtraordinary Transaction;
(iii) make any request for stockholder list materials discussions or other books and records of the Company arrangements with, or any of its subsidiaries under Section 220 of the Delaware General Corporation Law action to advise, assist, facilitate or encourage any third party, or any other statutory action to form, join or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used way participate in the proxy rules of the SECa group, but includingin each case, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors any of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, foregoing —for the avoidance of doubt, this shall not restrict the Stockholder from discussions with respect existing or prospective investors in the Company about other topics related to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;; or
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services foriv) any Third Party to do any of the actions set forth in this Section 3(c) action which would or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require force any Live Party Restricted Person or the Company to make a public announcement regarding any of the actions types of matters set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;foregoing.
(xvb) enter into The Stockholder agrees that any proposal delivered upon invitation or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director consent of the Company or nominee for director of the Company;
(xviBoard in accordance with Section 1(a) except as may be required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make to include any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event conditions that the Board nominates considers necessary or appropriate and shall be expressly conditioned, at a minimum, on the New Director for election to the Board at the 2025 Annual Meeting fully informed, uncoerced affirmative vote of a majority of shares held by disinterested stockholders (pursuant to Section 4(a144(b)(2) and of the New Director is so elected for Delaware General Corporation Law), voting as a term expiring no earlier than the Company’s 2026 annual meeting of stockholders separate class (the “2026 Annual MeetingDisinterested Stockholder Requirement”). In assessing the Disinterested Stockholder Requirement, then the restrictions and obligations set forth in Section 3 Company shall remain in effect until (or be reinstated and be applicable until) exclude the date that is thirty (30) calendar days prior votes of shares that, to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities knowledge of the Company, are beneficially owned by any Associated Stockholder.
(Vc) providing its views privately Notwithstanding anything in this Agreement to the Chairman contrary, the foregoing provisions of this Section 1 shall not be deemed to restrict the Board, Stockholder from: (i) communicating privately with the Board or the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or Chief Legal Officer (and any member other individual authorized by any of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferencesforegoing) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as so long as such private communications or requests are not intended to, and would not reasonably be expected to to, require any public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its businessthe Stockholder, strategy or any person; (ii) communicating privately with stockholders of the Company and performanceothers in a manner that does not otherwise violate this Agreement; or (iii) making any public disclosure necessary to comply with any law or legal process, or in order to comply with the rules of any securities exchange or market, so long as such private communications would requirement did not reasonably be expected to require public disclosure result from any violation of such communications, this Agreement or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stockother voluntary action by the Stockholder. Notwithstanding anything herein to the contrary, the restrictions set forth Nothing in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates be deemed to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to restrict in any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) way G. ▇▇▇▇▇▇▇ ▇▇▇▇, III in the ordinary course exercise of its business his fiduciary duties under applicable law as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 1 contract
Sources: Cooperation Agreement (Grindr Inc.)
Standstill. During (a) Except as otherwise provided in this Agreement, from the Cooperation Period, each Live Party will not, and will cause its Affiliates and its Representatives acting on behalf date hereof until the earlier of (x) the fifth anniversary of the Live Parties date of the Purchase Agreement and (collectively with y) the Live Partiesdate the Total Ownership Amount is less than the Release Share Total (the "Standstill Period"), without the “Restricted Persons”) to notprior approval of a majority of the Non-Investor Directors, no Investor-Related Party shall, directly or indirectly, without the prior written consent, invitation, or authorization (i) acquire voting securities of the Company or that would result in the Board:
(i) make any public announcementInvestor Group Beneficially Owning, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A the aggregate, a percentage of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, Outstanding Shares in excess of the sum of (A) the Closing Ownership Percentage plus (B) 1% (excluding any proposal changes to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies ownership resulting solely as a result of the Company, including any change a reduction in the number of directors serving on shares of Common Stock outstanding due to the Board or repurchase of shares of Common Stock by the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
Company), (ii) seekmake, alone or in concert with one or more Third Partiessolicit, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter offer or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in a Change of Control or, if made by a Person other than an Investor-Related Party or require public disclosurea group of which an Investor-Related Party is a member, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing constitute a Third Party to implement Bid, (iii) engage in any "solicitation" of "proxies" (as such vote or consent terms are used in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted the proxy rules promulgated by the prior written consent of SEC under the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the BoardExchange Act), other than such encouragement or advice that for the benefit of the Investor Directors, if and to the extent the Investor Group is consistent with the Board’s recommendation in connection with such matterentitled to designate any Investor Directors hereunder, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, the other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation Director nominees of the Board;
, (ixiv) engage in any short sale or any purchase, sale, or grant become part of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security a "group" (other than any index fund, exchange-traded fund, benchmark fund or broad basket a group that includes only members of securitiesthe Investor Group) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing would be required to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;SEC disclosing an intention to change or influence the control of the Company, or (v) grant any proxies, transfer shares to any voting trust or enter into any voting agreement (other than (x) among the members of the Investor Group, (y) pursuant to this Agreement or (z) in respect of proxies voting in favor of a slate of Directors nominated by the Board). Notwithstanding the foregoing, any member of the Investor Group may propose, or engage in discussions with the Board regarding, (I) a possible Change of Control transaction involving the Investor Group or (II) a possible acquisition involving members of the Investor Group of the securities or assets of the Company or its subsidiaries, provided that such discussions are not, and shall not be, publicly disclosed by any member of the Investor Group or any other Investor-Related Party or any of their respective respresentatives and would not in the written opinion of counsel to the Company reasonably satisfactory to the Investor Group (it being agreed and acknowledged that ▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, LLP is satisfactory counsel) be required by applicable law to be publicly disclosed.
(xviib) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions Nothing in this Section 3(c3.01 shall (i) prohibit or restrict any member of the Investor Group from responding to any inquiries from any stockholders of the Company as to such Person's intention with respect to the voting of any Common Stock Beneficially Owned by such Person, (ii) restrict the right of each Investor Director on the Board or any committee thereof to vote on any matter as such individual believes appropriate or the manner in which an Investor Director may participate in his or her capacity as a director in deliberations or discussions at meetings of the Board or as a member of any committee thereof, (iii) prohibit any member of the Investor Group from acquiring securities of the Company issued by way of conversion, dividend, stock split or other distribution or exchange, recapitalization or reclassification or similar transaction in respect of securities which such member of the Investor Group is permitted to Beneficially Own under this Agreement, or (iv) except as provided in Section 2.04, restrict the ability of the members of the Investor Group from voting for or against or abstaining from any vote in connection with any Change in Control transaction or Third Party Bid, (v) prevent the members of the Investor Group from selling their Acquisition Shares or (vi) prohibit any member of the Investor Group from complying with applicable law.
(c) Each member of the Investor Group shall terminate automatically in be fully released from the event of a material breach provisions of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that Section 3.01 in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board fails to appoint Mr. LD as Chairman of the Board at any time that Mr. LD has the right to, and has exercised his right to, be so appointed by the Board in accordance with Section 2.07 and such appointment is not prohibited by the applicable listing or corporate governance standards of the NYSE or any director of the Companyapplicable law, rule or regulation, (ii) at any financial advisortime during the two-year period after the date hereof, legal counsel an Investor Director then serving on the Board dies, resigns (other than as required by Section 2.03) or other advisor is removed or disqualified and the Board fails to appoint to the Company or Board any Investor Director designated by the Investor Group to be so appointed by the Board in accordance with Section 2.01(c)(ii) as successor to such Investor Director and such appointment is not prohibited by the applicable listing or corporate governance standards of the NYSE or any applicable law, rule or regulation, or (iii) solely the Board fails to appoint Mr. LD to the extent directed Board as an Investor Director in accordance with Section 2.01(b) and maintain Mr. LD on the Board as an Investor Director in accordance with the applicable provisions of Sections 2.01 and 2.03 at any time during the three-year period after the date hereof (other than as a result of Mr. LD's death or permitted resignation or the prohibition, by the Board, any officer applicable listing or corporate governance standards of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives NYSE or any Third Party (at applicable law, rule or regulation, of Mr. LD's appointment to or continuation of service on the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the CompanyBoard as an Investor Director).
Appears in 1 contract
Sources: Stockholders Agreement (Ionics Inc)
Standstill. During the Cooperation Period, each Live Party will not, and will cause its Affiliates and its Representatives acting on behalf 30-month period after the date of the Live Parties this Agreement (collectively with the Live Partiessuch period, the “Restricted PersonsTerm”), neither the Investor nor any of its Affiliates (collectively, the “Standstill Parties”) to notshall (and the Investor shall cause its Affiliates not to), except as expressly approved or invited in writing by the Company:
(a) directly or indirectly, without acquire beneficial ownership of Then Outstanding Ordinary Shares and/or Ordinary Shares Equivalents (or any instrument that gives the prior written consent, invitationInvestor or any of its Affiliates the economic equivalent of ownership of an amount of Ordinary Shares or Ordinary Shares Equivalents), or authorization make a tender, exchange or other offer to acquire Then Outstanding Ordinary Shares and/or Ordinary Shares Equivalents;
(b) directly or indirectly, seek to have called any meeting of the shareholders of the Company, propose or nominate for election to the Company’s Board of Directors any person whose nomination has not been approved by a majority of the Company’s Board of Directors or cause to be voted in favor of such person for election to the Company’s Board of Directors any Then Outstanding Ordinary Shares; 16
(c) directly or indirectly, encourage or support a tender, exchange or other offer or proposal by any other Person (an “Offeror”) the consummation of which would result in a Change of Control of the Company (an “Acquisition Proposal”); provided, however, that from and after the filing of a Schedule 14D-9 (or successor form of Tender Offer Solicitation/Recommendation Statement under Rule 14d-9 of the Board:Exchange Act) by the Company recommending that shareholders accept any such offer, Investor shall not be prohibited from taking any of the actions with respect to such offer otherwise prohibited by this Section 3.1(c) for so long as the Company maintains and does not withdraw such recommendation;
(id) make any public announcementdirectly or indirectly, proposal solicit proxies or offer (including any “solicitation” of “proxies” consents or become a participant in a solicitation (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation opposition to the recommendation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent majority of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person ’s Board of Directors with respect to (A) the giving or withholding of any proxy relating tomatter, or other authority seek to vote, advise or influence any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubtPerson, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreementvoting of any Then Outstanding Ordinary Shares;
(viie) form, join, knowingly encourage deposit any Then Outstanding Ordinary Shares in a voting trust or knowingly participate in or knowingly act in concert with subject any Group with respect Then Outstanding Ordinary Shares to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any the voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Boardsuch Then Outstanding Ordinary Shares;
(ixf) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to propose (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, purchase of the Company’s assets or businesses, or similar transaction involving the Company or (ii) any recapitalization, restructuring, sale, equity issuance liquidation or otherwise) or other extraordinary transaction with respect to the Company (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% each of the Common Stock, foregoing actions referred to in the case of each of clause (x) and (yii), an “Extraordinary Matter”);
(g) act in concert with any Third Party to take any action in clauses (a) through (e) above, or form, join or in any way participate in a “partnership, limited partnership, syndicate, or other group” within the meaning of Section 13(d)(3) of the Exchange Act;
(h) enter into discussions, negotiations, arrangements or agreements with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents relating to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein foregoing actions referred to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (a) through (f) above; or
(i) the Board request or any director of propose to the Company’s Board of Directors, (iiany member(s) any financial advisor, legal counsel thereof or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company that the Company amend, waive, or consider the amendment or waiver of, any provisions set forth in this Section 3.1 (who is including this clause (i)); provided, however, that the Investor may make such requests or proposals privately to the Company’s directors, officers or advisors if the Company executes, or publicly announces its intention to execute, a collaboration and licensing agreement, strategic alliance or similar transaction with a third party so long as, in each case, such requests or proposals are not also intended to, and would not reasonably be expected to, require any public disclosure by the Company or the Investor of such requests or proposals, as applicable; Notwithstanding anything to the contrary in this Section 3.1, the Investor may at any time communicate privately with the Company’s directors, officers or advisors or submit to the Company’s Board of Directors one or more confidential proposals or offers for a directortransaction (including a transaction that, if consummated, would result in a Change of Control), with respect to any of the foregoing matters, so long as any as, in each case, such communication is (x) communications and submissions are not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) intended to, and (y) would not made in a manner that would require, or reasonably be expected to requireto, require any public disclosure by the Live Parties Company or the Company to make a public announcement regarding Investor of such proposal. For the avoidance of doubtcommunications or submissions, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companyas applicable.
Appears in 1 contract
Standstill. During The Investor Parties agree that until the Cooperation Period, each Live Party will not, later of (i) 90 days after the first day on which no Investor Designee serves on the Board and will cause the Investor has no rights (or has irrevocably waived its Affiliates right) under Section 5.10 (except for Section 5.10(f)) and its Representatives acting on behalf (ii) the expiration of the Live Parties Lock-Up Period (collectively with the Live Parties“Standstill Expiration Date”), without the prior written approval of the Board, the “Restricted Persons”) to Investor Parties will not, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Boardand will cause their Affiliates not to:
(ia) acquire, offer or seek to acquire, agree to acquire or make a proposal to acquire, by purchase or otherwise, any equity securities or direct or indirect rights to acquire any equity securities of the Company, any securities convertible into or exchangeable for any such equity securities, any options or other derivative securities or contracts or instruments in any way related to the price of shares of Common Stock (solely to the extent that, after giving effect to such acquisition, the Investor Parties and their Affiliates would beneficially own, in the aggregate, greater than 15% of the then outstanding Common Stock (which calculation shall, for the avoidance of doubt, include the notional or other number of shares of Common Stock specified in the documentation for any Contract to which any of the Investor Parties are party which is designed to produce economic benefits and risks to any of the Investor Parties that correspond substantially to the ownership by the Investor Parties of shares of Common Stock, except in the case of any such Contract which is settled only in cash));
(b) make or in any public announcement, proposal way encourage or offer (including participate in any “solicitation” of “proxies” (whether or not relating to the election or removal of directors), as such terms are defined or used in Regulation 14A the rules of the Exchange Act))SEC, written consents to vote, or knowingly seek to advise or influence any Person with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination voting of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records voting securities of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law Subsidiaries, or any other statutory call or regulatory provisions providing for stockholder access seek to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become call a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent meeting of the Company;
(vi) knowingly encourage ’s stockholders or advise initiate any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, stockholder proposal for the avoidance of doubt, with respect to action by the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matterstockholders, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage seek election to or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by place a representative on the Board and consistent with or seek the recommendation removal of any director from the Board;
(ixc) engage in make any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) public announcement with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline offer, seek, propose or indicate an interest in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly with or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”without conditions), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance reorganization or otherwise) or (y) the issuance purchase of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 2550% of the Common Stockassets, in the case of each of clause (x) and (y), with any Person other than a Live Party properties or an Affiliate securities of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director Subsidiary of the Company, (ii) or any financial advisor, legal counsel or other advisor to extraordinary transaction involving the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer Subsidiary of the Company or any of their respective securities, or enter into any discussions, negotiations, arrangements, understandings or agreements (who is not also a director), whether written or oral) with respect to any other Person regarding any of the foregoing mattersforegoing;
(d) otherwise act, so long as alone or in concert with others, to seek to control or influence, in any such communication is (x) not released publicly by manner, the Live Parties management, board of directors or their Representatives policies of the Company or any Third Party of its Subsidiaries;
(at the direct e) make any proposal or indirect request statement of inquiry or disclose any intention, plan or arrangement inconsistent with any of the Live Partiesforegoing;
(f) and advise, assist, knowingly encourage or direct any Person to do, or to advise, assist, knowingly encourage or direct any other Person to do, any of the foregoing;
(yg) not made in a manner take any action that would require, or reasonably be expected to require, the Live Parties or require the Company to make a public announcement regarding such proposal. For the possibility of a transaction or any of the events described in this Section 5.07;
(h) enter into any agreements, arrangements or understandings with any third party (including security holders of the Company, but excluding, for the avoidance of doubt, any Investor Parties) with respect to any of the foregoing, including forming, joining or in any way participating in a “group” (as defined in Section 13(d)(3) of the Exchange Act) with any third party in connection with any of the foregoing;
(i) request the Company or any of its Representatives, directly or indirectly, to amend or waive any provision of this Section 5.07; provided that this clause shall not prohibit the Investor Parties from making a confidential request to the Company seeking an amendment or waiver of the provisions of this Section 5.07, which the Company may accept or reject in its sole discretion, so long as any such request is made in a manner that does not require public disclosure thereof by any Person; or
(j) contest the validity of this Section 5.07 or make, initiate, take or participate in any demand, Action (legal or otherwise) or proposal to amend, waive or terminate any provision of this Section 5.07; provided, however, that nothing in this Agreement shall prevent or Section 5.07 will limit (1) the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Investor Parties’ other Representatives for ability to vote (subject to Section 5.11), Transfer or Hedge (subject to Section 5.08), convert shares of Series A Preferred Stock into Common Stock (subject to Section 6 of the purpose Certificate of evaluatingDesignations), negotiating the terms of and consummating the Transaction limit or restrict any transfer pursuant to a Permitted Loan or any transactions involving foreclosure thereunder or transfer in lieu of a foreclosure thereunder, privately make and submit to the CompanyCompany and/or the Board any proposal that is intended by the Investor Parties to be made and submitted on a non-publicly disclosed or announced basis (and would not reasonably be expect to require public disclosure by any Person), participate in rights offerings made by the Company to all holders of its Common Stock, receive any dividends or similar distributions with respect to any securities of the Company held by the Investor Parties, tender shares of Common Stock or Series A Preferred Stock into any tender or exchange offer (subject to Section 5.08), effect an adjustment to the Conversion Rate pursuant to the Certificate of Designations or otherwise exercise rights under its Common Stock or Series A Preferred Stock that are not the subject of this Section 5.07 or (2) the ability of the Investor Director to vote or otherwise exercise his or her legal duties or otherwise act in his or her capacity as a member of the Board.
Appears in 1 contract
Standstill. During Each of the Cooperation GGC Investor and the BSMH Investor agrees that, notwithstanding Section 4.6 hereof, until the later of (a) the date that is two (2) years following the Closing and (b) the date that the GGC Investor loses its right to designate a director pursuant to Section 3.1(b), in the case of the GGC Investor, or the date that the BSMH Investor loses its right to designate a director pursuant to Section 3.1(c), in the case of BSMH Investor (the “Standstill Period”), each Live Party will not, and will cause neither such Stockholder nor its Affiliates and or Representatives (acting on its Representatives acting behalf or on behalf of such Stockholder or any of its Affiliates or at its direction or the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notdirection of such Stockholder or any of its Affiliates will, directly or indirectly, without the prior written consent, invitation, or authorization consent of the Company Board or the Board:
as expressly permitted herein, (i) make any public announcementacquire, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act))agree to acquire, written consents with respect topropose, or otherwise solicit, seek, cause, offer seek or offer to effectacquire, (A) or knowingly facilitate the acquisition or ownership of, any proposal to seek representation on the Board securities or otherwise seek to control or influence the management, the Board or the policies indebtedness of the Company, including any change in the number of directors serving on the Board warrant or the filling of any vacancy on the Board option to purchase such securities or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination ofindebtedness, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in security convertible into any such solicitation of proxies securities or consents;
indebtedness (v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (includingthan, for the avoidance of doubt, the issuance of shares of Class A Common Stock upon an exchange of shares of Class B Common Stock together with respect LLC Units), or any other right to acquire such securities or indebtedness that would result in such Stockholder owning more than forty-nine percent (49%) of the Company’s management outstanding voting power of the Company or (ii) enter, agree to enter, propose, seek or offer to enter into or knowingly facilitate any merger, business combination, recapitalization, restructuring or other extraordinary transaction involving the Company on the one hand and any Principal Stockholder or one or more of their Affiliates on the other hand. Notwithstanding the foregoing, each of the GGC Investor and the BSMH Investor shall be entitled to have discussions with the Chief Executive Officer of the Company and the Chairperson of the Board of the Company (if any), or the Boardfull Board (or any committee thereof), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of regarding any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions matters set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with4.5, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (but only so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but proposal does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to such Person. This Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement 4.5 shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if upon the occurrence of any of the following events: (i) the Company enters into a definitive agreement with respect to a transaction person or “group” of persons involving (x) the sale direct or transfer indirect acquisition of all or a controlling portion majority of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or person (other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of than the Company, (iiEnsemble or their respective Subsidiaries or a Principal Stockholder or its Permitted Transferees with respect to such Principal Stockholder) any financial advisor, legal counsel commences a tender offer or other advisor exchange offer with respect to securities representing a majority of the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer voting power of the Company and the Board fails to recommend against such tender offer or exchange offer within ten (who is not also a director), with respect to any 10) Business Days of the foregoing matters, so long as commencement thereof. Nothing in this Section 4.5 shall restrict any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made Stockholder’s ability to monetize its equity investment in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working compliance with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companyapplicable securities laws.
Appears in 1 contract
Sources: Shareholder Agreements (Ensemble Health Partners, Inc.)
Standstill. During The ▇▇▇▇▇▇▇ Group agrees that, for the Cooperation period commencing on the date of this Agreement and ending on the earlier of (i) the 30th calendar day preceding the opening of the nomination window for submission of director nominees at the Company’s 2016 Annual Meeting and (ii) a material breach by the Company of its obligations under this Agreement which is not cured within 5 business days after written notice from the ▇▇▇▇▇▇▇ Group (the “Standstill Period”), each Live Party will notneither it nor any of its Affiliates will, and it will cause each of its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notnot to, directly or indirectly, without the prior written consentin any manner other than pursuant to Section 6(c), invitation, acting alone or authorization of the Company or the Boardin concert with others:
(i) make submit any public announcementstockholder proposal (pursuant to Rule 14a-8 promulgated by the Securities and Exchange Commission (the “SEC”) under the Exchange Act or otherwise) or any notice of nomination or other business for consideration, proposal or offer nominate any candidate for election to the Board (including any “solicitation” by way of “proxies” (as such terms are defined or used in Rule 14a-11 of Regulation 14A of the Exchange Act)14A), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of than as expressly permitted by this Agreement;
(ii) seekengage in, alone directly or in concert with one or more Third Partiesindirectly, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary defined in Rule 14a-2 under the Exchange Act, solicitations 14a-1 of ten Regulation 14A) of proxies (10or written consents) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participantparticipant in a solicitation” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A of Regulation 14A under the Exchange Act) in opposition to the recommendation or proposal of the Board, or recommend or request or induce or attempt to induce any other person to take any such solicitation actions, or seek to advise, encourage or influence any other person with respect to the voting of the Common Stock (including any withholding from voting) or grant a proxy with respect to the voting of the Common Stock or other voting securities to any person other than to the Board or persons appointed as proxies or consentsby the Board;
(viii) disclose seek to call, or to request the call of, a special meeting of the Company’s stockholders, or make a request for a list of the Company’s stockholders or for any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent books and records of the Company;
(viiv) knowingly encourage form, join in or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating toway participate in a “partnership, limited partnership, syndicate or other authority to vote, any Voting Securities, or (Bgroup” within the meaning of Section 13(d)(3) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, Exchange Act with respect to the Company’s management Common Stock or the Board)deposit any shares of Common Stock in a voting trust or similar arrangement or subject any shares of Common Stock to any voting agreement or pooling arrangement, other than such encouragement a group consisting only of some or advice that is consistent with all of the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this AgreementInvestors and their Affiliates;
(viiv) form, join, knowingly encourage vote for any nominee or knowingly participate in or knowingly act in concert with any Group with respect nominees for election to any Voting Securitiesthe Board, other than solely with Affiliates of those nominated or supported by the Live Parties with respect to Voting Securities now or hereafter owned by themBoard;
(viiivi) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts except as specifically provided in SECTION 1 and the like), in each case other than (A) SECTION 2 of this Agreement, (B) solely between seek to place a representative or among the Live Parties and their Affiliates, other Affiliate or (C) granting any proxy in any solicitation approved by nominee on the Board and consistent with or seek the recommendation removal of any member of the Board or a change in the size or composition of the Board;
(ixvii) engage in any short sale acquire or any purchaseagree, saleoffer, seek or propose to acquire, or grant of any optioncause to be acquired, warrant, convertible security, share appreciation right, or other similar right ownership (including any put or call option or “swap” transactionbeneficial ownership) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate assets or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates business of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any rights or options to acquire any such assets or business from any person;
(viii) other than at the direction of its subsidiariesthe Board, its current seek, propose, or former directors or its officers (including derivative actions), each in their capacity as such make any statement (other than to enforce rights under this Agreementone or more members of the Board or management or its advisors or agents (including, without limitation, any firm engaged by the CDC); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated byto, or on behalf ofsolicit, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) negotiate with, or advise, finance, assist, seek provide any information to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Companyto, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, acquisition of control or other business combination, tender or exchange offer, purchase, sale or transfer of assets or securities, dissolution, liquidation, reorganization, change in structure or composition of the Board, change in the executive officers of the Company, change in capital structure, recapitalization, restructuringdividend, saleshare repurchase or similar transaction involving the Company, equity issuance its subsidiaries or otherwiseits business, whether or not any such transaction involves a change of control of the Company;
(ix) acquire, announce an intention to acquire, offer or (y) the issuance of securities representing propose to acquire, or convertible into or exchangeable or exercisable foragree to acquire, directly or indirectly, more than 25by purchase or otherwise, beneficial ownership of any (A) interests in any of the Company’s indebtedness or (B) Common Stock of the Company representing in the aggregate (amongst the ▇▇▇▇▇▇▇ Group and its Affiliates) in excess of 9.9% of the Company’s outstanding Common Stock; provided, however, nothing herein shall prevent the ▇▇▇▇▇▇▇ Group from confidentially seeking a waiver to acquire in excess of 9.9% of the case of each of clause Company’s outstanding Common Stock;
(x) and disclose publicly, or privately in a manner that could reasonably be expected to become public, any intention, plan or arrangement inconsistent with the foregoing;
(y), with xi) take any Person other than a Live Party action challenging the validity or an Affiliate enforceability of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal this SECTION 3; or
(xii) enter into any agreement, arrangement or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to understanding concerning any of the foregoing matters, so long as (other than this Agreement) or encourage or solicit any such communication is (x) not released publicly by the Live Parties or their Representatives or person to undertake any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companyforegoing activities.
Appears in 1 contract
Standstill. During Except pursuant to the Cooperation Periodterms of this Agreement, each Live Party the Co-Sale Agreement and the Right of First Refusal Agreement, or upon conversion of the Series D Preferred Stock into Common Stock, BI agrees that until December 31, 2000, BI will not, and will cause exercise its Affiliates best efforts to not allow any of its affiliates or associates (as such terms are used in Rule 12b-2 under the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), these terms to have such meaning throughout this Section), from and its Representatives acting on behalf after the date that such person becomes an affiliate or associate unless in any such case specifically invited to do so by the Board of the Live Parties (collectively with the Live PartiesDirectors of Transcend, the “Restricted Persons”) to not, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Boardto:
(a) acquire, announce an intention to acquire, offer or propose to acquire, solicit an offer to sell or agree to acquire by purchase, by gift, by joining a partnership, limited partnership, syndicate or other "group" (as such term is used in Section 13(d)(3) of the Exchange Act, such terms to have such meaning throughout this Section) or otherwise, any (i) make material assets, businesses or properties of Transcend other than in the ordinary course of business or pursuant to the express terms of the Development Agreement, or (ii) additional shares of Common Stock, Series D Preferred Stock or any public announcementother securities of Transcend convertible into, proposal exchangeable for or offer exercisable for Common Stock (including all such securities, collectively, "VOTING SECURITIES");
(b) participate in the formation or encourage the formation of any “"person" (as such term is used in Section 13(d)(3) of the Exchange Act, such term to have such meaning throughout this Section) which owns or seeks to acquire beneficial ownership of any Voting Securities, or join or in any way participate with any such person in such action;
(c) solicit, or participate in any "solicitation” " of “"proxies” " or become a "participant" in any "election contest" (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant these terms to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as have such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with meaning throughout this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transactionSection) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the CompanyTranscend;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 1 contract
Sources: Stock Purchase Agreement (Transcend Therapeutics Inc)
Standstill. During The Executive covenants and agrees that during the Cooperation Period, each Live Party will not, Term and will cause its Affiliates and its Representatives acting on behalf thereafter through the second anniversary of the Live Parties his Date of Termination (collectively with the Live Partiessuch period, the “Restricted PersonsStandstill Period”) to not), without the prior written consent of the Company, the Executive will not at any time, directly or indirectly, acquire, make any proposal or offer to acquire, or propose or facilitate the acquisition of, directly or indirectly, by purchase or otherwise, record or Beneficial Ownership of any equity securities of the Ashford-Related Entities, or securities of any of the Ashford-Related Entities that are convertible, exchangeable, redeemable or exercisable into such equity securities except those granted to him as contemplated by this Agreement. During the Standstill Period, without the prior written consent, invitation, or authorization consent of the Company Company, the Executive covenants and agrees that he will not at any time, directly or the Boardindirectly:
(i) enter into, agree to enter into, commence or submit any merger, consolidation, tender offer, exchange offer, business combination, share exchange, recapitalization, restructuring or other extraordinary transaction involving any of the Ashford-Related Entities, or any subsidiary or division thereof, or any of their respective securities or assets or take any action that would reasonably be expected to require any of the Ashford-Related Entities to make a public announcement regarding the possibility of any public announcementsuch transaction;
(ii) tender any equity securities of the Ashford-Related Entities into a tender or exchange offer commenced by a third party other than a tender or exchange offer that the Board of Directors of one of the Ashford-Related Entities has affirmatively publicly recommended to such Ashford-Related Entity’s stockholders that such stockholders tender into such offer and has not publicly withdrawn or changed such recommendation (and in the case of such a withdrawal or change of recommendation, proposal it shall not be a breach of this clause (ii) if the tendered or offer exchanged securities are withdrawn prior to the expiration of such tender or exchange offer);
(including iii) (x) make, or in any way participate in, any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the Securities and Exchange Commission (the “SEC”) promulgated pursuant to Section 14 of the Securities Exchange Act of 1934, but includingas amended (the “Exchange Act”)) to vote any securities of any of the Ashford-Related Entities under any circumstances, notwithstanding anything or deposit any securities of any of the Ashford-Related Entities in a voting trust or subject them to a voting agreement, pooling agreement or other agreement of similar effect, (y) seek to advise or influence any person with respect to the contrary voting of any securities of any of the Ashford-Related Entities (other than to vote as recommended by Board of Directors of any of the Ashford-Related Entities), or (z) grant any proxy with respect to any equity interests of any of the Ashford-Related Entities (other than to the applicable Ashford-Related Entity or a person specified by such Ashford-Related Entity in a proxy card provided to stockholders of such Ashford-Related Entity);
(iv) form, join or in any way participate in a “group” (as that term is used for purposes of Rule 14a-2 under the Exchange Act, solicitations 13d-5 or Section 13(d)(3) of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal any equity securities of one or more directors any of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consentsAshford-Related Entities;
(v) form or publicly disclose any intention, plan or arrangement to change any Third Partyof the members of the Board of Directors or executive officers of any of the Ashford-Related Entities, either publicly or in a manner that would reasonably be expected to result in or require public disclosureany of the executive officers of any Ashford-Related Entity, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Companygoverning documents of any of the Ashford-Related Entities;
(vi) knowingly encourage call, request the calling of, or advise otherwise seek or submit a written request for the calling of a special meeting of, or initiate any Third Party stockholder proposal for the election of any director or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) action by, the giving or withholding stockholders of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this AgreementAshford-Related Entities;
(vii) form, join, knowingly encourage make a public announcement in connection with seeking to influence or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates control the management of the Live Parties with respect to Voting Securities now Board of Directors, or hereafter owned by themthe policies, affairs or strategy of any of the Ashford-Related Entities;
(viii) enter into form or disclose any voting trustintention, plan or arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent inconsistent with the recommendation of the Boardforegoing;
(ix) engage in any short sale advise, assist or any purchase, saleencourage, or grant of enter into any optionarrangements with, warrant, convertible security, share appreciation right, or any other similar right (including any put or call option or “swap” transaction) persons in connection with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions matters set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;10(c); or
(xiiix) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or publicly request the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b10(c), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 1 contract
Sources: Employment Agreement (Ashford Inc.)
Standstill. During the Cooperation Standstill Period, each Live Party will notthe Investor, and will cause or any of its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live PartiesAffiliates, the “Restricted Persons”) to not, shall not directly or indirectly, without except as expressly invited in writing by the prior written consent, invitation, or authorization of the Company or the BoardCompany:
(i) make any public announcementsubject to Section 5.16, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of without the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies express consent of the Company, acquire any additional equity securities (including any change in the number Ordinary Shares, American Depositary Shares and Ordinary Share Equivalents) of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) or any instrument that gives the Investor or any of its Affiliates the terms economic equivalent of this Agreementownership of an amount of securities of the Company (a “Derivative”) if, after such acquisition, the Investor would beneficially own more than twenty one percent (21.0%) of the Company’s outstanding share capital;
(ii) seekknowingly encourage or support a tender, alone exchange or in concert with one other offer or more proposal by a Third PartiesParty, election provided, however, that from and after the filing of a Schedule 14D-9 (or appointment to, or representation onsuccessor form of Tender Offer Solicitation/Recommendation Statement under Rule 14d-9 of the Exchange Act) by the Company recommending that stockholders accept any such offer filed after such offer has commenced, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, Investor shall not be prohibited from taking any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholdersactions otherwise prohibited by this clause (ii) for so long as the Company maintains and does not withdraw such recommendation;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
propose (x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, purchase of the Company’s assets or businesses, or similar transaction involving the Company or (y) any recapitalization, restructuring, saleliquidation or other extraordinary transaction with respect to the Company;
(iv) seek to have called any meeting of the shareholders of the Company, equity issuance propose or otherwisenominate for election to the Company’s board of directors any person whose nomination has not been approved by a majority of the Company’s board of directors (excluding the Designated Director, if any) or cause to be voted in favor of such person for election to the Company’s board of directors any Ordinary Shares or American Depositary Shares of the then outstanding share capital of the Company or Ordinary Share Equivalents (yincluding any Derivatives) other than as contemplated by Section 5.3 hereof;
(v) solicit proxies or consents or become a participant in a solicitation (as such terms are defined in Regulation 14A under the Exchange Act) in opposition to the recommendation of a majority of the Company’s board of directors with respect to any matter, or seek to advise or influence any Third Party, with respect to voting of any Ordinary Shares or American Depositary Shares of the then outstanding share capital of the Company or Ordinary Share Equivalents (including any Derivatives);
(vi) deposit any Ordinary Shares or American Depositary Shares of the then outstanding share capital of the Company or Ordinary Share Equivalents in a voting trust or subject any Ordinary Shares or American Depositary Shares of the then outstanding share capital of the Company or Ordinary Share Equivalents to any arrangement or agreement with respect to the voting of such Ordinary Shares or American Depositary Shares of the then outstanding share capital of the Company or Ordinary Share Equivalents other than as contemplated by Section 5.3 hereof; or
(vii) act in concert with any Third Party to take any action in clauses (i) through (vi) above, or form or join in a “partnership, limited partnership, syndicate, or other group” with any Third Party within the meaning of Section 13(d)(3) of the Exchange Act with respect to the equity securities (including any Derivatives) of the Company. Notwithstanding the foregoing, (A) the issuance mere voting in accordance with Section 5.3 hereof of any voting securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in Company held by the case of each of clause (x) and (y), with any Person other than Investor or its Affiliates shall not constitute a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing violation of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contraryof clauses (i) through (vii) above, (B) nothing in this Agreement shall prohibit the Live Parties Investor or their Representatives any of its Affiliates from making non-public proposals tosubmitting to the board of directors of the Company or to management of the Company a confidential proposal for a transaction involving a Change of Control or other proposed action, provided that neither the Company nor the Investor or otherwise communicating withany of its Affiliates is required to publicly disclose the fact that such proposal or request to consider such a proposal was made, (C) if any executive officer or director of the Investor serves as a member of the Company’s board of directors, any action he or she takes in the performance of his or her duties as a member of the Company’s board of directors shall not be deemed to violate this Section 5.1, and (D) the provisions of this Section 5.1 shall terminate and be of no further force or effect if (i) the Board Company publicly announces the entry into a definitive agreement for the acquisition of the Company or more than fifty percent (50%) of its consolidated assets by a third party, or (ii) any director person commences a tender or exchange offer with respect to the securities representing fifty percent (50%) or more of the voting power of the Company, unless the Company files a recommendation statement under Rule 14d-9 of the Exchange Act (or such successor provision) with the SEC within 10 business days following commencement of such offer advising the Company’s stockholders to reject such offer (provided that if any transaction referred to in the foregoing clauses (i) and (ii) any financial advisoris terminated or abandoned, legal counsel or other advisor to then the provisions of this Section 5.1 shall again become effective). In the event that the Company engages in discussions or the Board or (iii) solely to the extent directed or permitted by the Board, any officer negotiations involving a possible Change of Control of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to requireCompany, the Live Parties or Investor will be given notice thereof and the Company right to make a public announcement regarding such proposal. For participate in any process on substantially the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ same terms as other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companyparticipants.
Appears in 1 contract
Sources: Share Purchase Agreement (Amgen Inc)
Standstill. During Senvest agrees that, prior to the Cooperation date that is three (3) years from the effective date of this Agreement (the “Standstill Period”), each Live Party will it shall not:
(a) make, and will effect, initiate, cause its Affiliates and its Representatives acting on behalf or participate in, at any time without the prior written consent of the Live Parties Company, (collectively with i) any acquisition of Beneficial Ownership of the Live PartiesCommon Stock resulting in an increase in its aggregate Beneficial Ownership of the Common Stock to a number of shares representing 20% or more of the outstanding shares of the Common Stock, (ii) any acquisition of any assets of the Company or any assets of any subsidiary or other affiliate of the Company, (iii) any tender offer, exchange offer, merger, business combination, recapitalization, restructuring, liquidation, dissolution or extraordinary transaction involving the Company or any subsidiary or other affiliate of the Company, or involving any securities or assets of the Company or any securities or assets of any subsidiary or other affiliate of the Company, other than (x) any tender of shares of the Common Stock in an issuer tender offer under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or a third party tender offer under the Exchange Act that is recommended by a majority of the current directors of the Company (the “Current Directors”), directors appointed or elected upon the recommendation of the current directors (“Subsequent Directors”) and directors appointed or elected upon the recommendation of the Current Directors and Subsequent Directors (collectively, the “Restricted PersonsIncumbent Board”) to notor (y) any merger, business combination, recapitalization, restructuring, liquidation, dissolution or extraordinary transaction not proposed or initiated, directly or indirectly, without the prior written consent, invitation, or authorization by Senvest that is recommended by a majority of the Company or the Incumbent Board:
, (iiv) make any public announcement, proposal or offer (including any “solicitation” of “proxies” or stockholder consents (as such terms are defined or used in under Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records securities of the Company or any of its subsidiaries under or (v) any stockholder proposals or recommendations or nominations for election to the Board of Directors that would require disclosure in the Company’s proxy statement prepared in connection with its annual meetings of stockholders; provided that (subject to Section 220 of 2 hereof) Senvest may vote the Delaware General Corporation Law Senvest Shares on proposals or any other statutory or regulatory provisions providing nominations that Senvest did not submit for stockholder access to books and records of inclusion in the Company or its AffiliatesCompany’s proxy statement;
(ivb) engage form, join or in any way participate in a “solicitationgroup” (as such term is used in within the proxy rules meaning of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under Section 13(d)(3) of the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket securities of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries;
(c) otherwise act, its current whether alone or former directors or its officers (including derivative actions)in concert with others, each in their capacity as such (other than to enforce rights under this Agreement); providedseek to propose to the Company, however, that for the avoidance any subsidiary of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Partyof their stockholders any merger, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreementbusiness combination, (D) exercising statutory appraisal rightsrestructuring, recapitalization or (E) responding similar transaction to or complying with validly issued legal processthe Company or any of its subsidiaries or otherwise seek or propose to influence or control the Company’s management or policies;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xivd) take any action that would reasonably be expected to (i) might require any Live Party or the Company to make a public announcement regarding any of the actions types of matters set forth in clause “(a)” or “(c)” of this sentence;
(e) agree or offer to take, or encourage or propose (publicly or otherwise) the taking of, any action referred to in clause “(a)”, “(b)”, “(c)” or “(d)” of this sentence;
(f) assist, induce or encourage any other Person to take any action of the type referred to in clause “(a)”, “(b)”, “(c)”, “(d)” or “(e)” of this sentence;
(g) enter into any discussions, negotiations, arrangement or agreement with any other Person relating to any of the foregoing; or
(h) request or propose that the Company or any of the Company’s representatives amend, waive or consider the amendment or waiver of any provision set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting4. Notwithstanding anything to the contrary in Section 4 of this Agreement, Senvest may (i) tender Senvest Shares in any tender offer made to the holders of the Company’s common stock; (ii) vote any Senvest Shares other than the Excess Shares in their exclusive discretion on any matter; and (iii) communicate on a confidential basis its intention to so tender or vote the Senvest Shares and its reasons for doing so to its investors (including but not limited to any managed accounts, the securities of which all are Beneficially Owned by Senvest) as of the date of such communication who are contractually obligated to treat such information confidentially; provided that in the case of clauses (i), (ii) and (iii) Senvest has not directly or indirectly taken any other action prohibited under in this Section 4. Additionally, nothing in this Agreement (including will prevent Senvest from communicating with the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing Chief Executive Officer of the Company to make a proposal for or taking to negotiate with Senvest in respect of a tender or exchange offer, merger or other actions (subject to the terms business combination, any other of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (IItransactions described in Section 4(a)(i) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify involving the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial OfficerSenvest, or General Counsel any amendment or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would communication is made confidentially and does not reasonably be expected to require public disclosure disclosure. Following the end of such communicationsthe Standstill Period, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth nothing in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable forshall, directly or indirectly, more than 25% prevent or otherwise limit Senvest from taking any actions referred to in clauses (a)-(h) of this Section 4 or related thereto, and in each case without notice to or consultation with the Company. The expiration of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, Standstill Period will not terminate or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to affect any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request other provisions of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the CompanyAgreement.
Appears in 1 contract
Sources: Shareholder Agreement (Senomyx Inc)
Standstill. During Each member of the Cooperation Ardsley Group agrees that other than as may be required by applicable law, order or regulation, during the Standstill Period, each Live Party it or he will not, and it or he will cause each of its or his Affiliates and its Representatives or agents or other persons acting on its or his behalf of the Live Parties not to:
(collectively with the Live Parties, the “Restricted Persons”a) to not, directly or indirectly, without the prior written consent, invitation, or authorization agreement of the Company (as authorized by the Board by a majority vote, excluding the Designee Directors), acquire, offer to acquire or agree to acquire, alone or in concert with any other individual or entity, by purchase, tender offer, exchange offer, agreement or business combination or any other manner, beneficial ownership of any securities of the Company, if, after completion of such acquisition or proposed acquisition, such party would beneficially own more than 14.99% of the outstanding Common Stock (calculated based on the Company’s latest annual or quarterly report with the SEC pursuant to Section 13 or 15(d) of the Exchange Act); provided, however, that such limitation shall not apply to shares acquired in connection with stock dividends or similar distributions or offerings of Company Common Stock made available generally on a pro rata basis to holders of Company Common Stock;
(b) submit any stockholder proposal (pursuant to Rule 14a-8 under the Exchange Act or otherwise) or any notice of nomination or other business for consideration, or nominate any candidate for election to the Board or oppose the director candidates nominated by the Board:, other than as expressly permitted by this Agreement;
(ic) make form, join in or in any public announcementother way participate in a “partnership, proposal limited partnership, syndicate or offer other group” within the meaning of Section 13(d)(3) of the Exchange Act with respect to the Common Stock or deposit any shares of Common Stock in a voting trust or similar arrangement or subject any shares of Common Stock to any voting agreement or pooling arrangement, other than solely with other members of the Ardsley Group or one or more Affiliates of a member of the Ardsley Group with respect to the Common Stock currently owned as set forth in the Ardsley Group’s latest amendment to its Schedule 13D or Common Stock acquired in the future (including subject to the limitations set forth in Section 6(a) hereof) or to the extent such a group may be deemed to result with the Company or any of its Affiliates as a result of this Agreement;
(d) solicit proxies or written consents of stockholders, or engage in or conduct any binding or nonbinding referendum with respect to the Common Stock, or make, or in any way participate in, any “solicitation” of any “proxiesproxy” within the meaning of Rule 14a-1 under the Exchange Act to vote, or advise, encourage or influence any person with respect to voting, any shares of Common Stock with respect to any matter, or become a “participant” in any contested “solicitation” for the election of directors with respect to the Company (as such terms are defined or used in Regulation 14A of under the Exchange Act)), written consents other than a “solicitation” or acting as a “participant” in support of all of the nominees of the Board at any stockholder meeting, provided that the foregoing shall not be deemed to restrict such actions in connection with respect toa proposed merger or sale of the Company, change in control of the Company, recapitalization or liquidation of the Company, acquisition or disposition by the Company;
(e) call, seek to call, or otherwise solicitto request the calling of, seeka special meeting of the stockholders of the Company, causeor seek to make, offer or offer to effectmake, a stockholder proposal at any meeting of the stockholders of the Company or make a request for a list of the Company’s stockholders (A) any proposal to seek representation on the Board or otherwise induce, encourage or assist any other person to initiate or pursue such a proposal or request) or otherwise acting alone, or in concert with others, seek to control or influence the management, the Board governance or the policies of the Company, including any except as expressly permitted by this Agreement, provided that the foregoing shall not be deemed to restrict such actions in connection with a proposed merger or sale of the Company, change in control of the number Company, recapitalization or liquidation of the Company, acquisition or disposition by the Company;
(f) vote for any nominee or nominees for election as directors serving on other than those nominated by or supported by the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, seek the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholdersBoard;
(iiig) make without the prior written agreement of the Company (as authorized by the Board by a majority vote, excluding the Director Designees), effect, offer or propose (i) any request for stockholder list materials acquisition of any material assets or other books and records businesses of the Company or any of its subsidiaries under Section 220 of by the Delaware General Corporation Law Ardsley Group, (ii) any tender offer or any exchange offer, merger, acquisition or other statutory or regulatory provisions providing for stockholder access to books and records of business combination involving the Company or any of its Affiliates;
subsidiaries and the Ardsley Group, or (iviii) engage in any “solicitation” (as such term is used in the proxy rules of the SECrecapitalization, but includingrestructuring, notwithstanding anything liquidation, dissolution or other similar extraordinary transaction with respect to the contrary Company or any of its subsidiaries; provided, however, that limitations in Rule 14a-2 under this Section 6(g) shall not prohibit (A) the tender of shares of Company Common Stock in response to a bona fide tender offer made in compliance with the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type the voluntary exchange of referendum relating shares of Company Common Stock in response to a bona fide exchange offer made in compliance with the Securities Act of 1933, as amended, Exchange Act, (C) the voting of shares of Company (includingCommon Stock in connection with a bona fide merger proposal, sale of material assets, recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction for the avoidance of doubt, with respect which stockholder approval is solicited pursuant to the Company’s management certificate of incorporation and/or applicable law or (D) purchases or sales of Company Common Stock in the Boardopen market (subject to the limitations described in Section 6(a)); provided, other than such encouragement or advice further, that is consistent the limitations in this Section 6(g) shall not apply in the event that a third party unrelated to the Ardsley Group signs an agreement with the Board’s recommendation Company effectuating any of the transactions described in connection with such matterclauses (i) through (iii) above;
(h) publicly disclose, or as cause or facilitate the public disclosure (including without limitation the filing of any document or report with the SEC or any other governmental agency or any disclosure to any journalist, member of the media or securities analyst) of, any intent, purpose, plan or proposal to obtain any waiver, or consent under, or any amendment of, any of the provisions of this Section 6, or otherwise expressly permitted seek, in any manner that would require public disclosure by any of the members of the Ardsley Group or their Affiliates or Associates, to obtain any waiver, consent under, or amendment of, any provision of this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ixi) engage in any short sale or any purchase, sale, sale or grant of any option, warrant, convertible security, share stock appreciation right, or other similar right (including including, without limitation, any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchangea broad-traded fund, benchmark fund based market basket or broad basket of securitiesindex) that includes, relates to, to or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Companysecurities;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiiij) enter into any negotiations arrangements, understandings or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade assist or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period)foregoing; provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision provisions of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VIIsubsection 6(j) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) be deemed to prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement action with respect to a proposed transaction involving described in Section 6(g) above except to the extent such transaction involves a member of the Ardsley Group as a party; or
(xk) take or cause or induce or assist others to take any action inconsistent with any of the sale or transfer foregoing; provided, that the provisions of all or this subsection 6(k) shall not be deemed to prohibit any action with respect to a controlling portion proposed transaction described in Section 6(g) above except to the extent such transaction involves a member of the Ardsley Group as a party. The foregoing shall not be deemed to prohibit the Designee Directors from engaging in any lawful act in their capacities as directors of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 1 contract
Sources: Settlement and Standstill Agreement (Comverge, Inc.)
Standstill. During Except as otherwise expressly provided in this Agreement (including this Section 3.1 and Section 3.2 hereto), none of the Cooperation Period, each Live Party will not, and will cause Shareholder or any of its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notshall, directly or indirectly, without acting alone, in a Group (other than a Group consisting solely of the prior written consentShareholder, invitationJFLEI and their Affiliates) or in concert with others:
(a) by purchase or otherwise, Beneficially Own, acquire, agree or authorization offer to acquire any Voting Securities or direct or indirect rights or options to Beneficially Own Voting Securities, including any voting trust certificates representing such securities (in each case, other than (i) the Shares, (ii) rights, options or warrants distributed on a pro rata basis to all holders of the class or classes of securities of the Company pursuant to distribution that has been approved by at least a majority of the Independent Directors constituting the entire Independent Committee, (iii) securities acquired from the Company pursuant to a rights offer, exchange offer or similar transaction made by the Board:Company which has been approved by at least a majority of the Independent Directors constituting the entire Independent Committee; (iv) grants of restricted Voting Securities or options to purchase Voting Securities (and the exercise thereof) to an executive officer of the Company who may be deemed to be an Affiliate of the Shareholder or JFLEI under this Agreement, which grants have been approved by at least a majority of the Independent Directors constituting the entire Independent Committee; and (v) grants of restricted Voting Securities or options to purchase Voting Securities (and the exercise thereof) to a nonemployee director of the Company who may be deemed to be an Affiliate of the Shareholder or JFLEI under this Agreement pursuant to an equity compensation plan generally available to all nonemployee directors of the Company, which grants have been approved by at least a majority of the Independent Directors constituting the entire Independent Committee);
(b) enter, propose to enter into, or solicit any merger or business combination, tender offer, exchange offer or similar transaction involving the Company, or purchase, acquire, propose to purchase or acquire or solicit the purchase or acquisition of any portion of the business or assets of the Company if, in each case, (i) make in such transaction, all holders of Voting Securities of the Company are not treated equally in terms of the dollar value at closing of the consideration, if any, to be received by such holders or (ii) such transaction is entered into with Affiliates, members of a Group that includes the Shareholder, JFLEI or their Affiliates or other Persons that are acting in concert with the Shareholder, JFLEI or their Affiliates to circumvent the foregoing provisions;
(c) make, or in any public announcementway participate in, proposal any "solicitation" of "proxies" or offer (including become a "participant" in any “solicitation” of “proxies” "election contest" (as such terms are defined or used in Regulation 14A of the proxy rules promulgated by the Commission under the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, for the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement)Independent Committee; provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 1 contract
Sources: Stockholders Agreement (Oao Technology Solutions Inc)
Standstill. During Each of the Cooperation PeriodShareholder and Parent agrees that until the earlier of (i) fifteen (15) months following the first day on which (x) no Shareholder Designee serves on the Board and (y) the Shareholder has irrevocably waived its right, each Live Party will notor no longer has any right, to nominate the Shareholder Designees to the Board under Section 4, and will cause its Affiliates and its Representatives acting on behalf (ii) the time at which the Shareholder Parties collectively hold less than [●]3 shares of Common Stock (adjusted for any stock split or similar event), without the prior written approval of the Live Parties (collectively with the Live PartiesBoard, the “Restricted Persons”) to Shareholder and Parent will not, directly or indirectly, without and will each cause their respective controlled Affiliates (including any other Shareholder Parties) solely to the prior written consent, invitation, extent such Person is acting at the direction of or authorization on behalf of the Company Shareholder or the BoardParent (as applicable), not to:
(ia) acquire, offer or seek to acquire, agree to acquire or make a proposal to acquire, by purchase or otherwise, any equity securities or direct or indirect rights to acquire any equity securities of the Company, any securities convertible into or exchangeable for any such equity securities, any options or other derivative securities (solely to the extent that, after giving effect to such acquisition, the Shareholder and its Affiliates would beneficially own, in the aggregate, more than [●]4 shares of Common Stock (adjusted for any stock split or similar event) (which calculation shall, for the avoidance of doubt, include the notional or other number of shares of Common Stock specified in the documentation for any Contract to which the Shareholder or any of the other Shareholder Parties is a party that is designed to produce economic benefits and risks to the Shareholder or any of the Shareholder Parties that correspond substantially to the ownership by the Shareholder Parties of shares of Common Stock));
(b) make or in any public announcement, proposal way knowingly encourage or offer (including participate in any “solicitation” of “proxies” (whether or not relating to the election or removal of directors), as such terms are defined or used in Regulation 14A the rules of the Exchange Act))SEC, written consents to vote, or knowingly seek to advise or influence any Person with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination voting of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records voting securities of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating toSubsidiaries, or other authority call or seek to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any meeting of the Company’s securities and would, in the aggregate shareholders or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held initiate any shareholder proposal for action by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”)shareholders, then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for seek election to the Board at the 2026 Annual Meeting. Notwithstanding anything or to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to place a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance representative on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or seek the removal of any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by from the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.;
Appears in 1 contract
Sources: Securities Sale Agreement (Martin Marietta Materials Inc)
Standstill. During Unless earlier terminated pursuant to Section 6.2, during the Cooperation PeriodStandstill Term, each Live except as otherwise provided in this Section 3 or unless expressly approved or invited in writing by the Board of Directors, neither the Investor nor any of its controlled Affiliates or any Third Party will notthat acquires, and will cause its Affiliates and its Representatives acting on behalf by way of merger, acquisition, consolidation, share purchase, asset purchase, recapitalization, restructuring or similar transactions, all or substantially all of the Live Parties assets of the Investor or beneficial ownership of a majority of the voting securities of the Investor (or any surviving or resulting entity thereof) (such Third Parties, “Successor Affiliates” and, collectively with the Live PartiesInvestor and its controlled Affiliates, the “Restricted PersonsStandstill Parties”) shall (and the Investor shall cause its controlled Affiliates not to):
(a) directly or indirectly acquire beneficial ownership of Shares of Then Outstanding Common Stock and/or Common Stock Equivalents, or make a tender, exchange or other offer to notacquire Shares of Then Outstanding Common Stock or Common Stock Equivalents (other than, in each case, the Purchased Shares);
(b) directly or indirectly seek to have called any meeting of the stockholders of the Company or propose or nominate for election to the Board of Directors any person whose nomination has not been approved by a majority of the Board of Directors or fail to cause to be voted in accordance with the recommendation of the Board of Directors with respect to such person for election to the Board of Directors any Shares of Then Outstanding Common Stock;
(c) directly or indirectly, without knowingly encourage or support a tender, exchange or other offer or proposal by any other Person or group (an “Offeror”) the prior written consentconsummation of which would result in a Change of Control (an “Acquisition Proposal”); provided, invitationhowever, that from and after the filing of a Schedule 14D-9 (or authorization successor form of Tender Offer Solicitation/Recommendation Statement under Rule 14d-9 of the Exchange Act) by the Company or recommending that stockholders accept any such offer, the Board:Investor shall not be prohibited from taking any of the actions otherwise prohibited by this Section 3.1(c) for so long as the Company maintains and does not withdraw such recommendation;
(id) make any public announcement, proposal directly or offer (including any “solicitation” of “proxies” indirectly solicit proxies or consents or become a participant in a solicitation (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation opposition to the recommendation of proxies or consents;
(v) disclose a majority of the Board of Directors with respect to any Third Partymatter, either publicly or in a manner that would reasonably be expected seek to result in advise or require public disclosureinfluence any Person, its with respect to voting or consent intentions or of any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation Shares of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent Then Outstanding Common Stock of the Company;
(vie) knowingly encourage deposit any Shares of Then Outstanding Common Stock in a voting trust or advise subject any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding Shares of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect Then Outstanding Common Stock to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any the voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Boardsuch Shares of Then Outstanding Common Stock;
(ixf) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to propose (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, purchase of all or substantially all of the assets or businesses of the Company and its subsidiaries, considered collectively, or the Company’s shares of capital stock that, together with the Shares of Then Outstanding Common Stock of the Company, would represent more than 50% of the Company’s outstanding shares of capital stock, or similar transaction involving the Company, or (ii) any recapitalization, restructuring, saleliquidation or other extraordinary transaction with respect to the Company;
(g) act in concert with any Third Party to take any action in clauses (a) through (f) above, equity issuance or otherwiseform, join or in any way participate in a “partnership, limited partnership, syndicate, or other group” within the meaning of Section 13(d)(3) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common StockExchange Act;
(h) enter into negotiations, in the case of each of clause (x) and (y), arrangements or agreements with any Person other than a Live Party relating to the foregoing actions referred to in (a) through (g) above; or
(i) request or an Affiliate propose to the Board of Directors, any member(s) thereof or any officer of the Live Parties or (ii) Company that the Company adopts any plan of complete amend, waive, or partial liquidationconsider the amendment or waiver of, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to set forth in this Section 3.1 (including this clause (i)); Notwithstanding the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contraryforegoing, nothing in this Agreement shall prohibit restrict the Live Parties Investor’s executive officers or their Representatives directors shall be restricted from making non-public proposals topurchasing or Disposing of shares of Common Stock for his or her personal account (other than through a tender or exchange offer), tendering his or her shares into a Third Party tender or exchange offer, voting his or her shares in any way he or she determines, or otherwise communicating with, (i) the Board depositing his or her shares into a voting trust or subjecting them to any director of the Company, (ii) any financial advisor, legal counsel arrangement or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), agreement with respect to any the voting of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companyshares.
Appears in 1 contract
Standstill. During Until the Cooperation Periodearliest to occur of (A) the sixth anniversary of the Second Closing Date, (B) the date on which Shareholders own, collectively, Voting Securities which would represent (i) less than 10% of the Total Voting Power and (ii) less than 10% of the Actual Voting Power and (C) termination under SECTION 2.2 (such period, the "STANDSTILL PERIOD"), each Live Party Shareholder will not, and will cause each of its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notnot to, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) make acquire, offer to acquire, or agree to acquire, by purchase or otherwise, any public announcementVoting Securities or voting rights or direct or indirect rights or options to acquire any Voting Securities of the Company or any of its Affiliates other than (A) the exercise of convertible securities acquired in compliance with the terms of this Agreement, proposal or offer an acquisition as a result of a stock split, stock dividend or similar recapitalization, (including any “solicitation” B) the acquisition of “proxies” shares of Common Stock which are subject to the ▇▇▇▇▇▇▇ Purchase Agreement, (C) with the prior written consent of the two most senior executive officers of the Company, acquisitions by all Shareholders of up to a collective aggregate amount of 3,000,000 shares (as such number may be appropriately adjusted to reflect stock splits, reverse stock splits, stock dividends or any other recapitalization of the Company) of Common Stock, (D) stock options or similar rights granted by the Company to an Affiliate of such Shareholder as compensation for performance as a director or officer of the Company or its subsidiaries (and any shares issuable upon exercise thereof), (E) transfers between such Shareholder and Related Transferees as permitted under SECTION 4.1(F) or (F) any rights which are granted to all shareholders of the Company (and any shares issuable upon exercise thereof); PROVIDED, HOWEVER, that if the Shareholders or any of their Affiliates in good faith inadvertently acquire not more than 500,000 shares of Common Stock in violation of these provisions and within 15 days after the first date on which the Shareholders have actual knowledge (including by way of written notice given by the Company) that a violation has occurred Shareholders or any of their Affiliates shall have transferred any shares of Common Stock held in violation of these provisions to unrelated third parties so that the Shareholders and their Affiliates no longer beneficially own any such shares or have any agreement or understanding relating to such shares, this SECTION 2.1 shall be deemed to not have been violated; and PROVIDED, FURTHER, that no violation of this provision shall be deemed to have occurred by reason of the indirect acquisition of beneficial ownership of securities resulting from (x) investments in investment funds as to which no Shareholder or Affiliate thereof has control or power to control with respect to voting or investment decisions or (y) acquisitions of securities by a limited partner in any Shareholder or Affiliates thereof as to which limited partner no Shareholder or its Affiliates has control or power to control;
(ii) make or cause to be made any proposal for a Reorganization Transaction;
(iii) form, join or in any way participate in a Group with respect to any securities of the Company or its Affiliates, other than with other Shareholders or Affiliates of any Shareholder; PROVIDED, HOWEVER, that in the case of securities other than voting securities, Shareholders may participate in a Group with respect thereto with the prior approval of a majority of the entire Board of Directors (which approval is requested in a manner which does not require disclosure publicly or to any third party);
(iv) make, or in any way cause or participate in, any "solicitation" of "proxies" to vote (as those terms are defined in Regulation 14A under the Exchange Act) with respect to the Company or its Affiliates, or communicate with, seek to advise, encourage or influence any Person, in any manner, with respect to the voting of, securities of the Company or its Affiliates, or become a "participant" in any "election contest" (as those terms are defined or used in Regulation 14A of Rule 14a-11 under the Exchange Act)), written consents ) with respect toto the Company or its Affiliates (other than non-public communications with other Shareholders or Affiliates of any Shareholder which would not require public disclosure by any Person);
(v) initiate, propose or, except with the prior approval of a majority of the entire Board of Directors (which approval is requested in a manner which does not require disclosure publicly or to any third parties) otherwise solicit, seek, cause, offer solicit stockholders for the approval of one or offer more stockholder proposals with respect to effect, (A) the Company or its Affiliates or induce or attempt to induce any other Person to initiate any stockholder proposal or seek election to or seek representation to place a representative on the Board of Directors of the Company (except pursuant to SECTION 3.1 of this Agreement) or its Affiliates or seek the removal of any member of the Board of Directors of the Company or its Affiliates (for this purpose, the actions of the Shareholder Designees in communicating (without public disclosure or disclosure to third parties) with the Board of Directors in their capacity as directors of the Company, and non-public communication by a Shareholder with other Shareholders or Affiliates of any Shareholder which would not require public disclosure by any Person, shall not be deemed to be in contravention of the paragraph (v));
(vi) in any manner, agree, attempt, seek or propose (other than making any request for permission with respect thereto which would not require disclosure publicly or to any third party) to deposit any securities of the Company or its Affiliates in any voting trust or similar arrangement or to subject any securities of the Company or its Affiliates to any other voting or proxy agreement, arrangement or understanding (other than any such agreements or understandings with other Shareholders or Affiliates of any Shareholder);
(vii) offer, sell or transfer any Common Stock or rights to receive Common Stock except for Dispositions in accordance with ARTICLE 4;
(viii) disclose any intention, plan or arrangement, or make any public announcement (or request permission to make any such announcement other than making any request for permission which would not require disclosure publicly or to any third party), or induce any other Person to take any action, inconsistent with the foregoing;
(ix) enter into any negotiations, arrangements or understandings with any third party with respect to any of the foregoing;
(x) advise, assist or encourage or finance (or assist or arrange financing to or for) any other Person in connection with any of the foregoing;
(xi) otherwise act in concert with others, to seek to control or influence the management, the Board of Directors or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
Affiliates (iv) engage in any “solicitation” (as such term is used in for this purpose, the proxy rules actions of the SEC, but including, notwithstanding anything to the contrary Shareholder Designees in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more their capacity as directors of the Company or any other matter or proposal relating shall not be deemed to the Company or become a “participant” be in contravention of this paragraph (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;xi)); or
(vxii) disclose to any Third Party, either publicly or in request a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value waiver of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates provisions of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers paragraphs (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (Ai) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
through (xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
SECTION 2.1 (xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case which would not require disclosure publicly or to any third party); PROVIDED, that would reasonably be expected to give rise to a requirement to publicly announce this SECTION 2.1 shall not restrict or disclose such request or proposal; provided that inhibit the restrictions in this Section 3(c) shall terminate automatically in the event rights of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice Shareholder to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise exercise its voting rights as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer stockholder of the Company (who is not also a directorsubject to SECTION 3.2), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 1 contract
Sources: Shareholder Agreements (Blackstone Capital Partners Ii Merchant Banking Fund Et Al)
Standstill. During Except as otherwise expressly provided in this Agreement (including this Section 3.1 and Section 3.2 hereto), none of the Cooperation Period, each Live Party will not, and will cause Shareholder or any of its Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to notshall, directly or indirectly, without acting alone, in a Group (other than a Group consisting solely of the prior written consentShareholder, invitationJFLEI and their Affiliates) or in concert with others:
(a) by purchase or otherwise, Beneficially Own, acquire, agree or authorization offer to acquire any Voting Securities or direct or indirect rights or options to Beneficially Own Voting Securities, including any voting trust certificates representing such securities (in each case, other than (i) the Shares, (ii) rights, options or warrants distributed on a pro rata basis to all holders of the class or classes of securities of the Company pursuant to distribution that has been approved by at least a majority of the Independent Directors constituting the entire Independent Committee, (iii) securities acquired from the Company pursuant to a rights offer, exchange offer or similar transaction made by the Board:Company which has been approved by at least a majority of the Independent Directors constituting the entire Independent Committee; (iv) grants of restricted Voting Securities or options to purchase Voting Securities (and the exercise thereof) to an executive officer of the Company who may be deemed to be an Affiliate of the Shareholder or JFLEI under this Agreement, which grants have been approved by at least a majority of the Independent Directors constituting the entire Independent Committee; and (v) grants of restricted CUSIP NO. 67082B 10 5 SCHEDULE 13D Page 31 of 39 Voting Securities or options to purchase Voting Securities (and the exercise thereof) to a nonemployee director of the Company who may be deemed to be an Affiliate of the Shareholder or JFLEI under this Agreement pursuant to an equity compensation plan generally available to all nonemployee directors of the Company, which grants have been approved by at least a majority of the Independent Directors constituting the entire Independent Committee);
(b) enter, propose to enter into, or solicit any merger or business combination, tender offer, exchange offer or similar transaction involving the Company, or purchase, acquire, propose to purchase or acquire or solicit the purchase or acquisition of any portion of the business or assets of the Company if, in each case, (i) make in such transaction, all holders of Voting Securities of the Company are not treated equally in terms of the dollar value at closing of the consideration, if any, to be received by such holders or (ii) such transaction is entered into with Affiliates, members of a Group that includes the Shareholder, JFLEI or their Affiliates or other Persons that are acting in concert with the Shareholder, JFLEI or their Affiliates to circumvent the foregoing provisions;
(c) make, or in any public announcementway participate in, proposal any "solicitation" of "proxies" or offer (including become a "participant" in any “solicitation” of “proxies” "election contest" (as such terms are defined or used in Regulation 14A of the proxy rules promulgated by the Commission under the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, for the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement)Independent Committee; provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.
Appears in 1 contract
Sources: Stockholders Agreement (Oao Technology Solutions Inc)
Standstill. During Between the Cooperation Execution Date and the fourth anniversary of the Execution Date, except as expressly authorized by Section 1 above during the Interim Period, each Live Party will notmember of the Sweet 13D Group (including McKinley solely in his individual capacity but excluding the obligat▇▇▇▇ ▇▇ subsection (a)(ii) and (a) (iii) below), and will cause its Affiliates agrees that it and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to respective Affiliates shall not, directly or indirectly, without the prior written consent, invitation, or authorization consent of the Company Board, which consent may be withheld in its sole and absolute discretion, directly or the Board:
(i) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seekindirectly, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;other Person:
(iiii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sellacquire, offer to acquire or agree to sellacquire, directly or indirectly, through swap or hedging transactions by purchase or otherwise, all Beneficial Ownership of any Spectranetics Securities (or substantially allany direct or indirect rights, voting rights decoupled from options or warrants for any Spectranetics Securities, except as may be employed through hedging or similar risk management strategies), other than the underlying Common Stock held by a Live Party or Affiliates Spectranetics Securities that such Person Beneficially Owns as of the Live Parties;
date hereof as referenced in Section 12(c) of this Settlement Agreement, provided, however, that McKinley may acquire additional common stock on the open market to t▇▇ ▇▇▇▇▇t that his total Beneficial Ownership does not exceed 300,000 shares of Common Stock; (xiii) instituteencourage any Person to acquire, solicit or join (iii) advise any litigationPerson with respect to the acquisition or proposed acquisition of, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (Spectranetics Securities other than attempts to enforce rights under this Agreement)dispose of such aforementioned Spectranetics Securities that such Person Beneficially Owns as of the date hereof; provided, however, that for the avoidance of doubt, the foregoing this Section (a) shall not prevent any Live Party apply to acquisitions resulting from (Ax) bringing litigation against the Company exercise of the vested options held by Largey, Samek or Sweet; or (y) stock splits, reverse stock splits or ▇▇▇▇▇ r▇▇▇▇▇sifications affecting all outstanding Spectranetics Securities (or any class(es) thereof) or stock dividends or other pro rata distributions by Spectranetics or its direct or indirect subsidiaries to enforce all holders of Spectranetics Securities (or any express provision class(es) thereof) or from exercise of this Agreement instituted any rights so distributed;
b) solicit, encourage any other Person to solicit, advise any Person with respect to the Solicitation of, or in accordance with and subject to Section 11any other way participate in, (B) making endorse or facilitate any counterclaim Solicitation of, Proxies or consents with respect to any proceeding initiated bySpectranetics Securities, or on behalf ofbecome a Participant, the Company or its Affiliates against otherwise engage in any Live Party, Solicitation of Proxies or consents (CA) bringing bona fide commercial disputes that do not relate with respect to any matter submitted or to be submitted to the subject matter vote of this Agreementthe holders of any Spectranetics Securities at any annual or special meeting or by written consent, (D) exercising statutory appraisal rightsincluding, without limitation, with respect to the election of Directors of Spectranetics in opposition to the nominees recommended by the Board or otherwise for the purpose of influencing or acquiring control of the management of Spectranetics, or (EB) responding to for the purpose of calling a special meeting of Spectranetics' stockholders or complying with validly issued legal processthe holders of any Spectranetics Securities;
(xiic) knowingly instigateadvise or seek to advise any Person with respect to the voting of any Spectranetics Securities;
d) submit, cooperate with encourage any other Person to submit, advise or assist (including any Person with respect to the submission of, or otherwise participate in, or endorse, or facilitate any nominations or proposals to Spectranetics or to the holders of Spectranetics Securities for consideration by providing the holders of any Spectranetics Securities at any annual or arranging financing special meeting of such holders or in any action to be taken by written consent pursuant to Spectranetics' charter or bylaws, Rule 14a-3 under the Exchange Act, the provisions of any document governing the terms of any such Spectranetics Securities or governing the rights of the holders thereof, or otherwise;
e) otherwise take any action to request a special meeting of the holders of any Spectranetics Securities;
f) request, or take any action to obtain or retain, any list of holders of Common Stock;
g) deposit any Spectranetics Securities in a voting trust or subject them to a voting agreement or other services foragreement or arrangement of similar effect or otherwise join or form a partnership, limited partnership, limited liability company, syndicate or other Group (except insofar as a Group consisting solely of the members of the Sweet 13D Group shall be deemed to exist at the Execution Date) for the purpose of acquiring, holding, voting or disposing of any Third Party Spectranetics Securities, or for the purpose of circumventing or avoiding any of the provisions of this Settlement Agreement, encourage, advise or assist any Person to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreementforegoing;
(xiiih) enter into any negotiations or agreements (whether written or oral) withengage in, or adviseoffer, finance, assist, seek agree or propose to persuade or knowingly encourageengage in, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director acquisition of the Company or nominee for director substantially all of the Company;
its assets (xvi) except other than to participate therein as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal stockholder on terms generally available to amend or waive any all of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice periodSpectranetics' stockholders); providedor arrange, further, that or in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or tradingway participate, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund financing for any such transaction or broad basket for the purchase by any person of securities that may contain any Spectranetics Securities or any assets of Spectranetics;
i) otherwise reflect the performance of, but does not primarily consist of, securities of the Company, act (Vx) providing its views privately to the Chairman of seek representation on the Board, (y) to seek the Company’s Chief Executive Officer, Chief Financial Officerremoval of any members of, or General Counsel a change in the composition or any member size of, the Board, or (z) to acquire control of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company Spectranetics or any of the Restricted Personsits securities or assets, provided, however, that this subsection (VIIz) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if acquisitions resulting from (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion exercise of the Company’s equity securities vested options held by Largey, Samek or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties Ms. Sweet; or (ii) the Company adopts stock splits, reverse stock spli▇▇ ▇▇ ot▇▇▇ reclassifications affecting all outstanding Spectranetics Securities (or any plan of complete class(es) thereof) or partial liquidation, dissolution, restructuring, recapitalization stock dividends or other reorganization, files a petition in bankruptcy under pro rata distributions by Spectranetics or its direct or indirect subsidiaries to all holders of Spectranetics Securities (or any provisions of federal class(es) thereof) or state bankruptcy law or consents to the filing from exercise of any bankruptcy petition under rights so distributed;
j) publicly disclose any similar applicable law. Notwithstanding anything herein intent, purpose, plan or proposal with respect to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the its Board, any officer of the Company (who is not also a director)management, with respect to policies, or affairs or any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties its securities or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would requireassets, or reasonably be expected to require, the Live Parties or take any action that could require the Company to make a any public announcement regarding disclosure relating to any such intent, purpose, plan or proposal. For the avoidance ; or
k) assist, advise, encourage, facilitate or enter into any agreement or arrangement to assist or advise, any other Person in taking any action referenced in any of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the CompanySections 9(a) through (j) above.
Appears in 1 contract
Standstill. During The parties agree that if (i) the Cooperation Period, each Live Party will not, and will cause its Affiliates and its Representatives acting on behalf Merger Agreement is terminated pursuant to Section 7.1(d) thereof or (ii) the Merger does not occur as a result of the Live Parties failure of the condition set forth in Section 6.3(f) of the Merger Agreement, then for the period beginning on the date of this Agreement and ending on the third anniversary of the date of the termination of the Merger Agreement (collectively with the Live Parties, the “Restricted PersonsStandstill Period”), except as otherwise provided in this Agreement:
(a) to notNone of the Shareholders will, directly or indirectly, without the prior written consent, invitation, or authorization consent of the Company or the Board:
, (i) make any public announcementacquire, proposal agree to acquire, propose, seek or offer to acquire any securities or assets of Wendy’s or any of its subsidiaries, any warrant or option to purchase such securities or assets, any security convertible into any such securities, or any other right to acquire such securities, other than the purchase by any Shareholder of any such securities that were owned on the date hereof by any other person that was a member of a “group” (including within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) with any Shareholder with respect to the Company on the date hereof, (ii) enter, agree to enter, propose, seek or offer to enter into any merger, share exchange, exchange offer, liquidation, dissolution, business combination, recapitalization, restructuring, or other extraordinary transaction involving Wendy’s or any of its subsidiaries, (iii) make, or in any way participate or engage in, any solicitation of proxies or consents to vote, or seek to advise or influence any person with respect to the voting of, any voting securities of Wendy’s, other than any voting rights pursuant to the Agreement, dated as of November 4, 2005 by and among S▇▇▇▇▇▇ Asset Management Corp and Trian Fund Management, L.P., and any amendments thereto, (iv) form, join or in any way participate in a “solicitation” of “proxiesgroup” (as such terms are defined or used in Regulation 14A Section 13(d)(3) of the Exchange Act)), written consents ) with respect toto any voting securities of Wendy’s, other than any Shareholder’s participation in a group with a member that was a member of a “group” (as defined in Section 13(d)(3) of the Exchange Act) on the date hereof with such Shareholder with respect to Wendy’s, (v) call, request the calling of, or otherwise solicit, seek, cause, offer seek or offer to effectassist in the calling of a special meeting of the shareholders of Wendy’s, (Avi) any proposal to seek representation on call, request the Board calling of, or otherwise seek or assist in the calling of a special meeting of the shareholders of Wendy’s, (vii) seek to make, or make, a stockholder proposal at any meeting of the stockholders of Wendy’s or make a request for a list of Wendy’s’ stockholders or otherwise acting alone, or in concert with others, seek to control or influence the management, the Board governance or the policies of Wendy’s, (viii) disclose any intention, plan or arrangement prohibited by the Companyforegoing, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (Bix) any public proposal advise, assist or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in enter into any “withhold” discussions, negotiations, agreements or similar campaign arrangements with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books persons, other than officers, directors, partners, members, employees, advisors (including without limitation, financial and records of the Company or its Affiliates;
(ivlegal advisors and accountants) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents and representatives with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner foregoing. Each Shareholder further agrees that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company.during
Appears in 1 contract
Standstill. During (a) The Investors hereby agree that from the Cooperation Period, each Live Party will not, Closing until the earliest of (i) such time as the Investors and will cause its their Affiliates no longer collectively own at least four and its Representatives acting on behalf nine-tenths percent (4.9%) of the Live Parties outstanding Common Stock, (collectively with ii) the Live Parties, fourth (4th) anniversary hereof or (iii) a Change of Control of the “Restricted Persons”) to not, directly or indirectlyCompany, without the prior written consent, invitation, or authorization approval of the Company Company, neither the Investors nor any of its Affiliates will, directly or the Boardindirectly:
(i) make acquire, offer or propose to acquire or agree to acquire, Beneficial Ownership of any public announcementVoting Securities, proposal other than Voting Securities acquired (A) as a result of the exercise of any rights or obligations set forth in the Standby Purchase Agreement or this Agreement, (B) pursuant to a stock split, stock dividend, recapitalization, reclassification or similar transaction, (C) directly from the Company, or (D) to maintain their aggregate percentage interest in the Company’s outstanding Common Stock; provided, however, that the Investor shall not be permitted to acquire, offer or propose to acquire or agree to acquire, Beneficial Ownership of any Voting Securities to account for the dilutive effect of any issuance of equity securities up to a maximum of the 4,329 shares of Common Stock authorized for issuance under the Company’s 2013 Equity Incentive Plan as of the date hereof; (ii) enter into or agree, offer, propose or seek (whether publicly or otherwise) to enter into, or otherwise be involved in or part of, any acquisition transaction, including any a proposed negotiated private sale of its shares of Common Stock to a single purchaser or a “solicitationgroup” of “proxies” (as such terms are defined or used in Regulation 14A Section 13(d) of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal merger or other statement that is directly contrary business combination relating to (all or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records part of the Company or any of its subsidiaries under Section 220 or any acquisition transaction for all or part of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records assets of the Company or any of its Affiliatessubsidiaries or any of their respective businesses; provided, however, that negotiated private sales of shares of Common Stock to a single purchaser or a “group” will be permitted if the purchasing party agrees in writing to be bound by the provisions of this Section 5.1;
(iii) other than a “solicitation” of a “proxy” (as such terms are defined under Regulation 14A under the Exchange Act, disregarding clause (iv) of Rule 14a-1(1)(2) and including any otherwise exempt solicitation pursuant to Rule 14a-2(b)) seeking approval of the election to the Board solely with respect to any of the Investor Nominated Directors permitted by the terms hereof to serve on such Board, make, or in any way participate in, any such “solicitation” of “proxies” to vote, or seek to advise or influence any person or entity with respect to the voting election of any director to the Board;
(iv) engage in any “solicitation” (as such term is used in the proxy rules call or seek to call a meeting of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors Common Stockholders of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage ’s subsidiaries or advise initiate any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) stockholder proposal for action by the giving or withholding Common Stockholders of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage join or knowingly in any way participate in or knowingly act in concert with any Group a “group” (within the meaning of Section 13(d)(3) of the Exchange Act and the rules and regulations thereunder) with respect to any Voting Securities;
(v) deposit any Securities of the Company into a voting trust unless such voting trust is bound by the provisions of this Section 5.1, or subject the Securities of the Company to any agreement or arrangement with respect to the voting of such Securities, or other agreement or arrangement having similar effect unless such agreement or arrangement conforms to the provisions of this Section 5.1;
(vi) seek representation on the Board or a change in the composition of the Board or number of directors elected by the holders of Common Stock or a change in the number of such directors who represent the Investor, other than solely with Affiliates of the Live Parties with respect as expressly permitted pursuant to Voting Securities now or hereafter owned by them;this Agreement; and
(viiivii) enter into bring any voting trust, arrangement action or agreement with respect otherwise act to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and contest the like), in each case other than (A) validity of this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement)Section 5.1; provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from nothing in clauses (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11ii), (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Partyiii), (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(civ) or (iivi) have the purpose or effect of circumventing any provision of this Agreement;
(xvSection 5.1(a) enter into shall apply to the Investor Nominated Director(s) solely in his or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any her capacity as a director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement actions taken by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties Investors or any of their Affiliates. Notwithstanding anything herein Affiliates to prepare the contrary, the restrictions set forth Investor Nominated Directors to act in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companycapacity.
Appears in 1 contract
Sources: Standby Purchase Agreement (Trade Street Residential, Inc.)
Standstill. During As of the Cooperation Perioddate hereof, each Live Party will not, you hereby represent and will cause its Affiliates and its warrant to the Company that neither you nor any of your Representatives acting on your behalf or affiliates owns any securities of the Live Parties Company. You agree that beginning on the date hereof and ending on the earliest of (collectively x) one year from the date of this letter agreement, (y) the time at which the Company enters into a definitive agreement with respect to (i) the Live Parties, the “Restricted Persons”) to notacquisition, directly or indirectly, without of more than fifty percent (50%) of the prior written consentCompany’s outstanding common stock (or other securities representing more than fifty percent (50%) of the aggregate voting power of securities entitled to vote in an election of directors) or more than fifty percent (50%)of the assets of the Company and its subsidiaries on a consolidated basis or (ii) any tender or exchange offer, invitationmerger or other business combination or any recapitalization, restructuring, liquidation, dissolution or authorization other extraordinary transaction (provided that, in the case of any transaction covered by this clause (ii), immediately following such transaction, any person (or the direct or indirect shareholders of such person) or group will beneficially own more than fifty percent (50%) of the Company’s outstanding common stock (or other securities representing more than fifty percent (50%) of the aggregate voting power of securities entitled to vote in an election of directors) of the Company or the Board:
surviving parent entity in such transaction), and (z) a person or group (I) acquires (whether via tender offer, exchange offer or otherwise) or (II) has commenced a tender offer or exchange offer under Rule 14(d) of the 1934 Act that, if completed in accordance with its terms, would result in the acquisition of, more than fifty percent (50%) of the Company’s outstanding common stock (or other securities representing more than fifty percent (50%) of the aggregate voting power of securities entitled to vote in an election of directors) (the “Standstill Period”), unless specifically invited in writing by the Board of Directors of the Company (or by a Representative of the Company on behalf of the Board of Directors), neither you nor any of your affiliates who receive Evaluation Material and are acting on your behalf or IAC/InterActiveCorp October 14, 2019 on behalf of other persons acting in concert with you will in any manner, directly or indirectly: (a) effect or seek, offer or propose (whether publicly or otherwise) to effect, or announce any intention to effect or cause or participate in or in any way knowingly assist, facilitate or encourage any other person to effect or seek, offer or propose (whether publicly or otherwise) to effect or participate in, (i) make any public announcementacquisition of any securities (or beneficial ownership thereof), proposal or offer rights or options to acquire any securities (including or beneficial ownership thereof), or any material assets, indebtedness or businesses of the Company or any of its subsidiaries, (ii) any tender or exchange offer, merger or other business combination involving the Company, any of the subsidiaries or assets of the Company or the subsidiaries constituting a significant portion of the consolidated assets of the Company and its subsidiaries, (iii) any recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to the Company or any of its subsidiaries, or (iv) any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A the proxy rules of the Securities and Exchange Act))Commission) or consents to vote any voting securities of the Company or any of its affiliates; (b) form, written consents join or in any way participate in a “group” (as defined under the ▇▇▇▇ ▇▇▇) with respect to, to the Company or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or act in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seekperson in respect of any such securities; (c) otherwise act, alone or in concert with others, to seek representation on or to control or influence the removal management, Board of any member of the Board Directors or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records policies of the Company or any to obtain representation on the Board of its subsidiaries under Section 220 Directors of the Delaware General Corporation Law Company; (d) take any action which would or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or force the Company to make a public announcement regarding any of the actions types of matters set forth in this Section 3(c(a) above; or (iie) enter into any discussions or arrangements with any third party (other than your Representatives) with respect to any of the foregoing; provided, that the foregoing obligations shall not apply to any acquisition, either directly or indirectly, of securities of a party or any of a party’s subsidiaries by any employee benefit or similar plan of the other party or such other party’s Representatives that does not have knowledge of, or access to, any Evaluation Material or Discussion Information (so long as such acquisition was not directed by a party or any of its Representatives that have knowledge of, or access to, any Evaluation Material or Discussion Information). You also agree during the purpose Standstill Period not to request (in any manner that would reasonably be likely to cause the Company to disclose publicly) that the Company or effect any of circumventing its Representatives, directly or indirectly, amend or waive any provision of this Agreement;
paragraph (xv) enter into including this sentence). Notwithstanding the foregoing, nothing in this paragraph 7 shall, directly or maintain indirectly, prevent or otherwise limit you from initiating or continuing any economicconfidential discussions, compensatory requests or pecuniary agreement, arrangement or understanding communications (written or oral) with including any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any confidential request or submit any proposal to amend or waive any of the terms provision of this Agreement (including this subclause)paragraph 7) with the Company or its board of directors or at any time making any confidential offer or proposal to the Company or its board of directors relating to any potential transaction, in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectlycase, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting such a waiver of any provision of this Agreement, manner as long as such private communications or requests would not reasonably be expected to require the public disclosure of such communications or requests thereof by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the CompanyRepresentatives.
Appears in 1 contract
Standstill. During Mutual hereby covenants and agrees that, on or before the Cooperation Periodfifth anniversary of the date hereof, each Live Party it will not, and will cause its Mutual Affiliates and its Representatives acting on behalf of the Live Parties (collectively with the Live Parties, the “Restricted Persons”) to not, directly or indirectly, without the prior written consent, invitation, or authorization consent of a majority of the Company or members of the BoardCompany's Board of Directors, do any of the following except pursuant to Section 2 hereof:
(ia) make any public announcement, proposal or offer (including any “solicitation” of “proxies” (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sellacquire, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying acquire any shares of Common Stock held by (or options or warrants to acquire, or securities convertible into or exchangeable for, shares of Common Stock) if, as a Live Party or Affiliates result of such acquisition, Mutual (together with any Mutual Affiliates) would Beneficially Own more than a number of shares of Common Stock in excess of a number equal to forty percent (40%) of the Live Parties;
outstanding shares of Common Stock plus forty percent (xi40%) institute, solicit or join any litigation, arbitration or other proceeding against or involving of the Company or any shares of its subsidiaries, its current or former directors or its officers Common Stock issuable upon conversion of the Convertible Notes plus forty percent (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement)40%) of the number of shares of Common Stock issuable upon conversation of the Preferred Stock; provided, however, that that, for the avoidance purposes of doubtcomputing such amount, the foregoing 29,800 shares of Common Stock Beneficially Owned by Invista Capital Management, Inc. ("Invista") on November 3, 1997 shall not prevent any Live Party be excluded from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee such calculation for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications shares are regarded as Beneficially Owned by Invista (and no longer) and provided that no executive officer or requests would not reasonably be expected to require public disclosure director of such communications Mutual or requests by the Company Principal or any employee of the Restricted PersonsMutual, (VII) subject to Section 3(b)Principal, privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their affiliates other than officers, directors or employees of Invista charged with the responsibility thereof shall participate in the voting of such shares and provided further that for so long as the Convertible Notes are outstanding, Mutual and the Mutual Affiliates. Notwithstanding anything herein , in the aggregate, will not vote or act on written consent in any matter coming before shareholders at any shareholder meeting or shareholder action in excess of forty percent (40%) of the shares of Common Stock outstanding plus forty percent (40%) of the shares of Preferred Stock outstanding;
(b) directly or indirectly commence or participate in a solicitation of proxies either to oppose the election of any Person to the contraryBoard of Directors or to seek the removal of any Person from the Board of Directors, which Person has been nominated by the restrictions set forth in Section 3 shall automatically terminate and be Nominating Committee of no further force and effect if the Board of Directors;
(ic) vote its shares of Common Stock for the election of any Person to the Board of Directors other than the Persons nominated by the Nominating Committee of the Board of Directors; or
(d) directly or indirectly make or solicit or assist any third party to make a tender or exchange offer to purchase any shares of Common Stock or make any public announcement concerning, or submit any written proposal to the Board of Directors of the Company enters into for a definitive agreement with respect to a transaction involving (x) the sale or transfer merger, share exchange, acquisition of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions transaction involving the Company.
Appears in 1 contract
Standstill. During Each of the Cooperation PeriodShareholder and Parent agrees that until the earlier of (i) fifteen (15) months following the first day on which (x) no Shareholder Designee serves on the Board and (y) the Shareholder has irrevocably waived its right, each Live Party will notor no longer has any right, to nominate the Shareholder Designees to the Board under Section 4, and will cause its Affiliates and its Representatives acting on behalf (ii) the time at which the Shareholder Parties collectively hold less than 5,326,525 shares of Common Stock (adjusted for any stock split or similar event), without the prior written approval of the Live Parties (collectively with the Live PartiesBoard, the “Restricted Persons”) to Shareholder and Parent will not, directly or indirectly, without and will each cause their respective controlled Affiliates (including any other Shareholder Parties) solely to the prior written consent, invitation, extent such Person is acting at the direction of or authorization on behalf of the Company Shareholder or the BoardParent (as applicable), not to:
(ia) acquire, offer or seek to acquire, agree to acquire or make a proposal to acquire, by purchase or otherwise, any equity securities or direct or indirect rights to acquire any equity securities of the Company, any securities convertible into or exchangeable for any such equity securities, any options or other derivative securities (solely to the extent that, after giving effect to such acquisition, the Shareholder and its Affiliates would beneficially own, in the aggregate, more than 12,783,660 shares of Common Stock (adjusted for any stock split or similar event) (which calculation shall, for the avoidance of doubt, include the notional or other number of shares of Common Stock specified in the documentation for any Contract to which the Shareholder or any of the other Shareholder Parties is a party that is designed to produce economic benefits and risks to the Shareholder or any of the Shareholder Parties that correspond substantially to the ownership by the Shareholder Parties of shares of Common Stock));
(b) make or in any public announcement, proposal way knowingly encourage or offer (including participate in any “solicitation” of “proxies” (whether or not relating to the election or removal of directors), as such terms are defined or used in Regulation 14A the rules of the Exchange Act))SEC, written consents to vote, or knowingly seek to advise or influence any Person with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination voting of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records voting securities of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law Subsidiaries, or any other statutory call or regulatory provisions providing for stockholder access seek to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become call a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent meeting of the Company;
(vi) knowingly encourage ’s shareholders or advise initiate any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, shareholder proposal for the avoidance of doubt, with respect to action by the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such mattershareholders, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage seek election to or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by place a representative on the Board and consistent with or seek the recommendation removal of any director from the Board;
(ixc) engage in make any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) public announcement with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline publicly offer, seek, propose or indicate an interest in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly with or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”without conditions), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance reorganization or otherwise) or (y) the issuance purchase of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% a material portion of the Common Stockassets, in the case of each of clause (x) and (y), with any Person other than a Live Party properties or an Affiliate securities of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director Subsidiary of the Company, (ii) or any financial advisor, legal counsel or other advisor to extraordinary transaction involving the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer Subsidiary of the Company or any of their respective securities, or enter into any discussions, negotiations, arrangements, understandings or agreements (who is not also whether written or oral) with any other Person (excluding, for the avoidance of doubt, any Shareholder Parties) regarding any of the foregoing;
(d) otherwise act, alone or in concert with others, to seek to control or influence, in any manner, the management, Board or policies of the Company or any of its Subsidiaries;
(e) make any public proposal or publicly disclose any intention, plan or arrangement inconsistent with any of the foregoing prohibited actions;
(f) advise or knowingly assist, knowingly encourage or direct any Person to do, or to advise, assist, knowingly encourage or direct any other Person to do, any of the foregoing prohibited actions;
(g) take any action that would require the Company to make a director)public announcement under applicable Law regarding the possibility of a transaction or any of the events described in or actions prohibited by this Section 5;
(h) deposit any Common Stock and any other securities of the Company entitled to vote at any general meeting of the Company in a voting trust or similar Contract (unless such securities remain subject to the restrictions set forth in this Agreement) or subject any such securities to any voting agreement, pooling arrangement or similar arrangement or Contract, or grant any proxy with respect to any such voting securities;
(i) enter into any agreements, arrangements or understandings with any third party (including security holders of the Company, but excluding, for the avoidance of doubt, any Shareholder Parties) with respect to any of the foregoing mattersprohibited actions, so long as including forming, joining or in any such communication is way participating in a Group with any third party in connection with any of the foregoing prohibited actions;
(xj) not released publicly by request the Live Parties or their Representatives Company or any Third Party of its Representatives, directly or indirectly, to amend or waive any provision of this Section 5; or
(at k) contest the direct validity of this Section 5 or indirect request make, initiate, take or participate in any demand, Action (legal or otherwise) or proposal to amend, waive or terminate any provision of this Section 5; provided, however, that nothing in this Section 5 or elsewhere in this Agreement will limit Parent or the Shareholder Parties’ ability, as applicable, to (A) vote, Transfer (subject to Section 2.1) or otherwise exercise rights hereunder or under their Common Stock, (B) designate a Shareholder Designee or Shareholder Observer and the ability of any Shareholder Designee to deliberate, vote or otherwise exercise his or her legal duties or otherwise act in his or her capacity as a member of the Live PartiesBoard, (C) privately make and submit to the Company and/or the Board any proposal that is intended by Parent or the Shareholder Parties (yas applicable) to be made and submitted on a non-publicly disclosed or announced basis (and would not made in a manner that would require, or reasonably be expected to requirerequire public disclosure by any Person), (D) privately communicate with the Live Parties Company and/or Board regarding any matter, including with respect to any Designated Shareholder Voting Matter (that would not reasonably be expected to require public disclosure by any Person), (E) make any disclosure required under Section 13(d) of the Securities Exchange Act or any other applicable Law, or (F) comply with applicable Law. The provisions of Section 5 shall be inoperative and of no force or effect from and after the date on which: (a) any Person or Group that is not an Affiliate of the Company shall have acquired or entered into a binding definitive agreement that has been approved by the Board (or any duly constituted committee thereof composed entirely of independent directors) to acquire more than fifty percent (50%) of the outstanding voting stock or equity securities of the Company or the voting power to elect a majority of the Board or assets of the Company to make or its subsidiaries representing more than fifty percent (50%) of the consolidated assets of the Company and its subsidiaries, taken as a public announcement regarding such proposal. For the avoidance of doubtwhole, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ any other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Merger Transaction or Sale Transaction or (b) the Company becomes subject to any transactions involving the Companyvoluntary or involuntary reorganization or restructuring process relating to bankruptcy, insolvency or protection of creditors generally.
Appears in 1 contract
Sources: Shareholders Agreement (Martin Marietta Materials Inc)
Standstill. During (a) Each Purchaser hereby agrees that from the Cooperation Closing until the date that is three (3) years following the Closing (the “Standstill Period”), each Live Party will such Purchaser shall not, and will shall cause its Affiliates not to, directly or indirectly:
(i) except for Equity Securities of the Company received (1) by way of stock splits, stock dividends, reclassifications, recapitalizations or other distributions by the Company in respect of the Preferred Shares (or the Common Stock issuable on conversion of the Preferred Shares), (2) pursuant to the conversion of the Preferred Shares, (3) pursuant to Section 5.4, (4) by such Purchaser by way of a transfer or sale from any other Purchaser, (5) by way of an issuance by the Company, or (6) upon the exercise or conversion of any convertible or exercisable Equity Securities of the Company received pursuant to the foregoing sub-clauses (1), (2), (3), (4) or (5), (x) acquire (directly or indirectly, by purchase or otherwise) any Equity Securities of the Company or (y) authorize or make a tender offer, exchange offer or other offer or proposal, whether oral or written, to acquire (directly or indirectly, by purchase or otherwise) Equity Securities of the Company, in each case, if such acquisition (together with any other Equity Securities of the Company previously acquired) would result in such Purchaser and its Representatives acting Affiliates Beneficially Owning (on behalf an as converted basis) an amount of Common Stock equal to or greater than fifteen percent (15%) of the Live Parties Company’s issued and outstanding Common Stock (collectively assuming the conversion of the Preferred Shares held by such Purchaser and its Affiliates);
(ii) except indirectly as a result of ownership of Equity Securities of the Company acquired hereunder at any Closing or thereafter in accordance with Section 5.3(a)(i), (x) acquire (directly or indirectly, by purchase or otherwise) any Equity Securities of any Subsidiary of the Live PartiesCompany or (y) authorize or make a tender offer, exchange offer or other offer or proposal, whether oral or written, to acquire (directly or indirectly, by purchase or otherwise) Equity Securities of any Subsidiary of the “Restricted Persons”Company, in each case if such acquisition (together with any other Equity Securities of any Subsidiary of the Company previously acquired) would result in such Purchaser and its Affiliates Beneficially Owning (on an as converted basis) an amount of any such Subsidiary’s common stock equal to notor greater than fifteen percent (15%) of such Subsidiary’s issued and outstanding common stock (assuming conversion of any Equity Securities that is convertible into common stock held by such Purchaser and its Affiliates);
(iii) make, or in any way participate, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) make any public announcement, proposal or offer (including in any “solicitation” of “proxies” to vote (as such terms are defined or used in Regulation 14A of the Exchange Act)), written consents with respect to, or otherwise solicit, seek, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal or other statement that is directly contrary to (or may require the Company to waive) any of the terms of this Agreement;
(ii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law or any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC), but including, notwithstanding anything or seek to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten advise or influence any Person (10other than (x) such Purchaser or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2its Affiliates or (y) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;
(viii) enter into any voting trust, arrangement or agreement with respect to any Voting Securities, or subject any Voting Securities to any voting trust, arrangement or agreement (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and the like), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to the voting of any security Voting Stock;
(other than iv) authorize or commence any index fundtender offer or exchange offer for shares of Voting Stock (for the avoidance of doubt, exchange-traded fundtendering into any tender offer or exchange offer not otherwise violating this clause this Section 5.3(a)(iv) will not violate this Section 5.3(a)(iv));
(v) form, benchmark fund join or broad basket in any way participate in a “group” as defined in Section 13(d)(3) of securities) that includesthe Exchange Act, relates tofor the purpose of voting, acquiring, holding, or derives disposing of any significant part Voting Stock;
(vi) submit to the Board a written proposal for or offer of its value from a decline in (with or without conditions), any merger, recapitalization, reorganization, business combination or other extraordinary transaction involving the market price Company or value of any Subsidiary thereof or any of the Company’s securities and wouldor assets, in the aggregate or individually, result in the Live Parties ceasing make any public announcement with respect to have a Net Long Position in the Companysuch proposal or offer;
(xvii) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving request the Company or any of its subsidiariesAffiliates, its current directly or former directors or its officers (including derivative actions)indirectly, each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any provision of this Section 5.3; or
(viii) enter into any arrangements with any third party concerning any of the terms of this Agreement foregoing.
(including this subclause)b) If, in each case publicly or that would reasonably be expected to give rise to a requirement to publicly announce or disclose such request or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the any time such notice is given or prior to the end termination of the notice period); providedStandstill Period, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters has entered into a definitive agreement agreement, the consummation of which would result in a Change of Control, (ii) any Person shall have commenced and not withdrawn a bona fide public tender or exchange offer which if consummated would result in a Change of Control and the Board has not recommended that the stockholders of the Company reject such offer within the time period contemplated by Rule 14e 3 under the Exchange Act, or (iii) the Company files or consents to the filing against the Company of a petition for relief or reorganization or arrangement or any other petition in bankruptcy, insolvency, reorganization or other similar Law, makes an assignment for the benefit of creditors or consents to the appointment of a custodian, receiver, trustee or other officer with similar powers with respect to a transaction involving (x) the sale Company or transfer of all with respect to any substantial part or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by mergerits property, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stockthen, in each case, for so long as such condition continues to apply, the case of each of clause limitation on the actions described in clauses (xiii), (iv), (v), (vi), (vii) and (y)viii) of Section 5.3(a) (and any related acquisition of Beneficial Ownership by such Purchaser and/or their Affiliates) shall not be applicable to such Purchaser.
(c) Anything in this Section 5.3 to the contrary notwithstanding, with this Section 5.3 shall not be construed to prohibit or restrict (i) any Person other than actions taken by any designee, nominee or appointee on the Board, in their capacities as a Live Party or an Affiliate member of the Live Parties Board and in compliance with and subject to his or her fiduciary duties as a member of the Board or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives Purchaser from making non-public suggestions, recommendations and proposals toregarding the future management of, or otherwise communicating withbusiness plans of, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Company’s management or its Board, in each case that would not require any Person to publicly disclose such suggestions, recommendations or proposals.
Appears in 1 contract
Standstill. During (a) Each Purchaser hereby agrees that from Closing until the Cooperation date that is three (3) years following the Closing (the “Standstill Period”), each Live Party will such Purchaser shall not, and will shall cause its Affiliates not to, directly or indirectly:
(i) except for Equity Securities of the Company received (1) by way of stock splits, stock dividends, reclassifications, recapitalizations or other distributions by the Company in respect of the Shares (or the Common Stock issuable on conversion of the Shares), (2) pursuant to the conversion of the Shares, (3) pursuant to Section 5.5, or (4) upon the exercise or conversion of any convertible or exercisable Equity Securities of the Company received pursuant to the foregoing subclauses (1), (2) or (3), (x) acquire (directly or indirectly, by purchase or otherwise) any Equity Securities of the Company or (y) authorize or make a tender offer, exchange offer or other offer or proposal, whether oral or written, to acquire (directly or indirectly, by purchase or otherwise) Equity Securities of the Company, in each case, if such acquisition (together with any other Equity Securities of the Company previously acquired) would result in such Purchaser and its Representatives acting Affiliates Beneficially Owning (on behalf a fully diluted basis) an amount of Common Stock equal to or greater than fifteen percent (15%) of the Live Parties Company’s issued and outstanding Common Stock;
(collectively ii) except indirectly as a result of ownership of Equity Securities of the Company acquired hereunder at the Closing or thereafter in accordance with Section 5.4(a)(i), (x) acquire (directly or indirectly, by purchase or otherwise) any Equity Securities of any Subsidiary of the Live PartiesCompany or (y) authorize or make a tender offer, exchange offer or other offer or proposal, whether oral or written, to acquire (directly or indirectly, by purchase or otherwise) Equity Securities of any Subsidiary of the “Restricted Persons”Company, in each case if such acquisition (together with any other Equity Securities of any Subsidiary of the Company previously acquired) would result in such Purchaser and its Affiliates Beneficially Owning (on a fully diluted basis) an amount of any such Subsidiary’s common stock equal to notor greater than (A) fifteen percent (15%) of, or (B) with respect to Spectrum or Old Mutual, any of, its issued and outstanding common stock;
(iii) make, or in any way participate, directly or indirectly, without the prior written consent, invitation, or authorization of the Company or the Board:
(i) make any public announcement, proposal or offer (including in any “solicitation” of “proxies” to vote (as such terms are defined or used in Regulation 14A the rules of the SEC), or seek to advise or influence any Person (other than (x) such Purchaser or its Affiliates, (y) in accordance with and consistent with the recommendation of the Board or (z) with respect to the Fortress Representatives that are directors) with respect to the voting of any Voting Stock;
(iv) authorize or commence any tender offer or exchange offer for shares of Voting Stock (for the avoidance of doubt, tendering into any tender offer or exchange offer not otherwise violating this clause this Section 5.4(a)(iv) will not violate this Section 5.4(a)(iv));
(v) form, join or in any way participate in a “group” as defined in Section 13(d)(3) of the Exchange Act), for the purpose of voting, acquiring, holding, or disposing of any Voting Stock;
(vi) submit to the Board a written proposal for or offer of (with or without conditions), written consents with respect toany merger, or otherwise solicitrecapitalization, seekreorganization, cause, offer or offer to effect, (A) any proposal to seek representation on the Board or otherwise seek to control or influence the management, the Board or the policies of the Company, including any change in the number of directors serving on the Board or the filling of any vacancy on the Board or (B) any public proposal business combination or other statement that is directly contrary to (or may require extraordinary transaction involving the Company to waive) or any Subsidiary thereof or any of the terms of this Agreementsecurities or assets, or make any public announcement with respect to such proposal or offer;
(iivii) seek, alone or in concert with one or more Third Parties, election or appointment to, or representation on, the Board or publicly nominate, indicate an intention to nominate, or propose the nomination of, or recommend the nomination of, any candidate to the Board, seek, alone or in concert with others, the removal of any member of the Board or initiate, encourage or participate in any “withhold” or similar campaign with respect to any meeting of stockholders;
(iii) make any request for stockholder list materials or other books and records of the Company or any of its subsidiaries under Section 220 of the Delaware General Corporation Law Affiliates, directly or indirectly, to amend or waive any other statutory or regulatory provisions providing for stockholder access to books and records of the Company or its Affiliates;
(iv) engage in any “solicitation” (as such term is used in the proxy rules of the SEC, but including, notwithstanding anything to the contrary in Rule 14a-2 under the Exchange Act, solicitations of ten (10) or fewer stockholders that would otherwise be excluded from the definition of “solicitation” pursuant to Rule 14a-2(b)(2) under the Exchange Act) of one or more proxies or consents with respect to the election or removal of one or more directors of the Company or any other matter or proposal relating to the Company or become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A under the Exchange Act) in any such solicitation of proxies or consents;
(v) disclose to any Third Party, either publicly or in a manner that would reasonably be expected to result in or require public disclosure, its voting or consent intentions or any vote as to any matter submitted to a stockholder vote during the Cooperation Period (it being understood that instructing a Third Party to implement any such vote or consent in a ministerial manner in accordance with this Agreement would not be a violation provision of this provision), except that such disclosure may be made if required by law or if permitted by the prior written consent of the Company;
(vi) knowingly encourage or advise any Third Party or knowingly assist any Third Party in encouraging or advising any other Person with respect to (A) the giving or withholding of any proxy relating to, or other authority to vote, any Voting Securities, or (B) conducting any type of referendum relating to the Company (including, for the avoidance of doubt, with respect to the Company’s management or the Board), other than such encouragement or advice that is consistent with the Board’s recommendation in connection with such matter, or as otherwise expressly permitted by this Agreement;
(vii) form, join, knowingly encourage or knowingly participate in or knowingly act in concert with any Group with respect to any Voting Securities, other than solely with Affiliates of the Live Parties with respect to Voting Securities now or hereafter owned by them;Section 5.4; or
(viii) enter into any voting trustarrangements with any third party concerning any of the foregoing.
(b) If, at any time prior to the termination of the Standstill Period, (i) the Company has entered into a definitive agreement, the consummation of which would result in a Company Change in Control Event, (ii) any Person shall have commenced and not withdrawn a bona fide public tender or exchange offer which if consummated would result in a Company Change in Control Event and the Board has not recommended that the stockholders of the Company reject such offer within the time period contemplated by Rule 14e 3 under the Exchange Act, or (iii) the Company files or consents to the filing against the Company of a petition for relief or reorganization or arrangement or agreement any other petition in bankruptcy, insolvency, reorganization or other similar Law, makes an assignment for the benefit of creditors or consents to the appointment of a custodian, receiver, trustee or other officer with similar powers with respect to the Company or with respect to any Voting Securitiessubstantial part or its property, then, in each case, for so long as such condition continues to apply, the limitation on the actions described in clauses (iii), (iv), (v), (vi), (vii) and (viii) of Section 5.4(a) (and any related acquisition of Beneficial Ownership by such Purchaser and/or their Affiliates) shall not be applicable to such Purchaser.
(c) Anything in this Section 5.4 to the contrary notwithstanding, this Section 5.4 shall not be construed to prohibit or restrict (i) any actions taken by any designee, nominee or appointee (including the Fortress Representatives) on the Board, in their capacities as a member of the Board and in compliance with and subject to his or her fiduciary duties as a member of the Board or (ii) the Purchaser from making non-public suggestions, recommendations and proposals regarding the future management of, or subject any Voting Securities business plans of, the Company to any voting trust, arrangement the Company’s management or agreement its Board after the occurrence of a Specified Breach Event or a Director Addition Event (excluding customary brokerage accounts, margin accounts, prime brokerage accounts and each as defined in the likeCertificate of Designation), in each case other than (A) this Agreement, (B) solely between or among the Live Parties and their Affiliates, or (C) granting any proxy in any solicitation approved by the Board and consistent with the recommendation of the Board;
(ix) engage in any short sale or any purchase, sale, or grant of any option, warrant, convertible security, share appreciation right, or other similar right (including any put or call option or “swap” transaction) with respect to any security (other than any index fund, exchange-traded fund, benchmark fund or broad basket of securities) that includes, relates to, or derives any significant part of its value from a decline in the market price or value of any of the Company’s securities and would, in the aggregate or individually, result in the Live Parties ceasing to have a Net Long Position in the Company;
(x) sell, offer or agree to sell, directly or indirectly, through swap or hedging transactions or otherwise, all or substantially all, voting rights decoupled from the underlying Common Stock held by a Live Party or Affiliates of the Live Parties;
(xi) institute, solicit or join any litigation, arbitration or other proceeding against or involving the Company or any of its subsidiaries, its current or former directors or its officers (including derivative actions), each in their capacity as such (other than to enforce rights under this Agreement); provided, however, that for the avoidance of doubt, the foregoing shall not prevent any Live Party from (A) bringing litigation against the Company to enforce any express provision of this Agreement instituted in accordance with and subject to Section 11, (B) making any counterclaim with respect to any proceeding initiated by, or on behalf of, the Company or its Affiliates against any Live Party, (C) bringing bona fide commercial disputes that do not relate to the subject matter of this Agreement, (D) exercising statutory appraisal rights, or (E) responding to or complying with validly issued legal process;
(xii) knowingly instigate, cooperate with or assist (including by providing or arranging financing or other services for) any Third Party to do any of the actions set forth in this Section 3(c) or that have the purpose or effect of the Live Parties circumventing any provision of this Agreement;
(xiii) enter into any negotiations or agreements (whether written or oral) with, or advise, finance, assist, seek to persuade or knowingly encourage, any Third Party to take any action or make any statement prohibited by this Section 3(c), or make any investment in or enter into any agreement with any other person that engages, or offers or proposes to engage, in any of the actions prohibited by this Section 3(c);
(xiv) take any action that would reasonably be expected to (i) not require any Live Party or the Company to make a public announcement regarding any of the actions set forth in this Section 3(c) or (ii) have the purpose or effect of circumventing any provision of this Agreement;
(xv) enter into or maintain any economic, compensatory or pecuniary agreement, arrangement or understanding (written or oral) with any director of the Company or nominee for director of the Company;
(xvi) except as required by applicable law, voluntarily file a Schedule 13D with the SEC;
(xvii) make any request or submit any proposal to amend or waive any of the terms of this Agreement (including this subclause), in each case publicly or that would reasonably be expected to give rise to a requirement Person to publicly announce or disclose such request suggestions, recommendations or proposal; provided that the restrictions in this Section 3(c) shall terminate automatically in the event of a material breach of this Agreement by the Company if such material breach has not been cured within five (5) Business Days following the Live Parties providing written notice to the Company of such material breach (provided that the Live Parties are not in material breach of this Agreement at the time such notice is given or prior to the end of the notice period); provided, further, that in the event that the Board nominates the New Director for election to the Board at the 2025 Annual Meeting pursuant to Section 4(a) and the New Director is so elected for a term expiring no earlier than the Company’s 2026 annual meeting of stockholders (the “2026 Annual Meeting”), then the restrictions and obligations set forth in Section 3 shall remain in effect until (or be reinstated and be applicable until) the date that is thirty (30) calendar days prior to the notice deadline under the Company’s Second Amended and Restated Bylaws for the nomination of non-proxy access director candidates for election to the Board at the 2026 Annual Meeting. Notwithstanding anything to the contrary in this Agreement, nothing in this Agreement (including the restrictions in this Section 3(c)) will prohibit or restrict any Restricted Person from (I) making any public or private proposal, negotiating, seeking financing for or taking other actions (subject to the terms of the Confidentiality Agreement (as defined herein)), with respect to an Extraordinary Transaction between the Live Parties and the Company, (II) making any factual statement to comply with any subpoena or other legal process or respond to a request for information from any governmental authority with jurisdiction over such Restricted Person (so long as such process or request did not arise as a result of any discretionary act by any Restricted Person intending to cause or otherwise provoke such process or request); provided that such Restricted Person will notify the Company promptly in writing (unless prohibited by law or contract) of the existence, terms, and circumstances surrounding such request or requirement, (III) granting any lien or encumbrance on any claim or interest in favor of a bank or broker-dealer or prime broker holding such claim or interest in custody or prime brokerage in the ordinary course of business, which lien or encumbrance is released upon the transfer of such claim or interest in accordance with the terms of the custody or prime brokerage agreement(s), as applicable, (IV) negotiating, evaluating or trading, directly or indirectly, in any index fund, exchange-traded fund, benchmark fund or broad basket of securities that may contain or otherwise reflect the performance of, but does not primarily consist of, securities of the Company, (V) providing its views privately to the Chairman of the Board, the Company’s Chief Executive Officer, Chief Financial Officer, or General Counsel or any member of the Company’s investor relations team made available for communications involving broad-based groups of investors (including through participation in investor meetings or conferences) regarding any matter, (VI) privately requesting a waiver of any provision of this Agreement, as long as such private communications or requests would not reasonably be expected to require public disclosure of such communications or requests by the Company or any of the Restricted Persons, (VII) subject to Section 3(b), privately communicating with other Third Parties, including those beneficially owning Common Stock, about the Company, including its business, strategy and performance, so long as such private communications would not reasonably be expected to require public disclosure of such communications, or (VIII) purchasing or, subject to Section 2 hereof, selling shares of Common Stock. Notwithstanding anything herein to the contrary, the restrictions set forth in this Agreement shall not (i) prohibit the Live Parties from privately identifying potential candidates to be nominated for election to the Board at the 2025 Annual Meeting and (ii) apply to any of the Live Parties’ Representatives effecting or recommending transactions in securities (x) in the ordinary course of its business as an investment advisor, broker, dealer in securities, market maker, specialist or block positioner or (y) not at the direction or request of the Live Parties or any of their Affiliates. Notwithstanding anything herein to the contrary, the restrictions set forth in Section 3 shall automatically terminate and be of no further force and effect if (i) the Company enters into a definitive agreement with respect to a transaction involving (x) the sale or transfer of all or a controlling portion of the Company’s equity securities or all or a substantially all of the Company’s assets (whether by merger, consolidation, business combination, tender or exchange offer, recapitalization, restructuring, sale, equity issuance or otherwise) or (y) the issuance of securities representing or convertible into or exchangeable or exercisable for, directly or indirectly, more than 25% of the Common Stock, in the case of each of clause (x) and (y), with any Person other than a Live Party or an Affiliate of the Live Parties or (ii) the Company adopts any plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization, files a petition in bankruptcy under any provisions of federal or state bankruptcy law or consents to the filing of any bankruptcy petition under any similar applicable law. Notwithstanding anything herein to the contrary, nothing in this Agreement shall prohibit the Live Parties or their Representatives from making non-public proposals to, or otherwise communicating with, (i) the Board or any director of the Company, (ii) any financial advisor, legal counsel or other advisor to the Company or the Board or (iii) solely to the extent directed or permitted by the Board, any officer of the Company (who is not also a director), with respect to any of the foregoing matters, so long as any such communication is (x) not released publicly by the Live Parties or their Representatives or any Third Party (at the direct or indirect request of the Live Parties) and (y) not made in a manner that would require, or reasonably be expected to require, the Live Parties or the Company to make a public announcement regarding such proposal. For the avoidance of doubt, nothing in this Agreement shall prevent or limit the Live Parties or their respective Affiliates and Representatives from working with the Live Parties or the Live Parties’ other Representatives for the purpose of evaluating, negotiating the terms of and consummating the Transaction or any transactions involving the Companyproposals.
Appears in 1 contract
Sources: Securities Purchase Agreement (Harbinger Group Inc.)