Common use of Supermajority Approval Clause in Contracts

Supermajority Approval. Notwithstanding anything to the contrary herein (but subject to Sections 4.5, 9.4, 9.5, 9.6, 9.7, and 9.8), the Company shall not (and the Company shall cause each other Atrium Company not to) take, authorize, facilitate or permit to occur any of the following actions without the prior approval of (x) the Kenner Group, and (y) either the ML Group or the UBS Group (except that if any of the Kenner Group, the ML Group or the UBS Group owns less than 10% of the Operating Company Share Equivalents then outstanding, only the approval of the other two groups shall be required), which approval may only be given in accordance with Section 3.7(b): (i) the authorization or issuance, or the entry into any agreement (or into any amendment to such agreement) or the issuance of any instrument providing for, the authorization or issuance (contingent or otherwise) of, any shares of capital stock, equity-linked, derivative or other equity securities or other Convertible Securities of any Atrium Group Company (including the adoption of any stock option plan or other stock incentive plan or arrangement or the amendment of or supplement to any stock option plan), in each case to the extent not covered by Section 5.14(a)(ix); provided, however, that the foregoing restrictions shall not apply to: (A) the issuance of 7,750 Operating Company Shares issuable upon exercise of the warrant issued by the Operating Company to Jeff L. Hull, dated December 10, 2003, (B) the issuance of ▇,▇▇▇ ▇▇▇▇▇▇▇▇▇ Company Shares issuable to Key Executives of the Operating Company pursuant to the exercise of stock options to be issued on or after date hereof having an exercise price per share equal to $1000, (C) the authorization of an option pool covering 5,250 Operating Company Shares issuable to Key Executives of the Operating Company pursuant to the exercise of stock options to be issued on or after date hereof (which stock option issuances shall be subject to the restrictions set forth in this Section 5.14(b)(i)) having an exercise price per share greater than $1,000; and (D) the formation of or issuance of any such securities of any wholly owned Subsidiary of the Operating Company to the Operating Company or any other wholly owned Subsidiary of the Operating Company; (ii) (A) the approval of any Annual Budget, (B) any material amendment to an Approved Annual Budget, or (C) except to the extent necessary to effect an acquisition consented to in accordance with (or permitted by) Section 5.14(b)(v) or Section 5.14(b)(vi), the authorization in any one Fiscal Year (but not on a monthly basis) of any capital or operating expenditure or series of capital or operating expenditures by the Company or any other Atrium Group Company exceeding $1,000,000 in the aggregate, unless expressly provided for in the Approved Annual Budget; (iii) the appointment, or renewal of appointment of, or removal of the independent auditors of any Atrium Group Company (which in any event shall be at all times a Big Four Firm); (iv) the making of any changes to or departures from the accounting policies, practices or principles of any Atrium Group Company, other than as required by GAAP, applicable law or listing requirements; (v) the making by the Atrium Group Companies of any Investment; (vi) the acquisition of (A) tangible or intangible assets (including the acquisition of an existing business from another Person, or (B) a Controlling interest in another Person that is not a wholly owned Subsidiary of an Atrium Group Company (whether in the form of equity securities, equity-linked securities, derivative securities or convertible securities (including any interests in any partnership or joint venture)), by one or more Atrium Group Companies, including any capital expenditure not included in the Approved Budget, for an acquisition price in respect of any single acquisition or series of related acquisitions in excess of $10,000,000 or an acquisition price in the aggregate for all such acquisitions in excess of $40,000,000 in any "rolling" three-year period commencing on the date hereof (taking into account for purposes of valuing any such acquisition or series of related acquisitions the amount of debt, if any, assumed by the applicable Atrium Group Company and the maximum amount of deferred or contingent consideration, if any, to be paid by it in connection with such acquisition); provided, however, that this Section 5.14(b)(vi) shall not apply to the acquisition of inventory in the ordinary course of business consistent with past practice; (vii) except as expressly permitted by Section 4.2, the declaration or making of any dividend on or with respect to any limited liability company interest or capital stock or other equity interest, as the case may be, of any Atrium Group Company or any other distribution to the Members or the stockholders of any Atrium Group Company of any assets or property of such Atrium Group Company, in each case other to the Operating Company or any of its wholly owned Subsidiaries; (viii) (A) the commencement of any legal action or any arbitration proceeding involving amounts in excess of $500,000 individually or otherwise material to any Atrium Group Company, or (B) the compromise or settlement of any legal action or any arbitration proceeding involving amounts in excess of $100,000 individually or otherwise material to any Atrium Group Company; (ix) (A) the designation, hiring, removal or replacement of any Key Executive, (B) the entry into an employment agreement with any Key Executive, or any amendment to, waiver, renewal or extension of, any material term of the employment agreement of such Key Executive (it being understood and agreed that any provision thereof relating to the compensation of such Key Executive shall be deemed material) or (C) the exercise of any right (but not the compliance with any obligation under) or the granting of any waiver under, any employment arrangement with any Key Executive entered into in compliance with this Agreement; (A) except pursuant to the Registration Rights Agreement, the registration of any of its securities under any applicable securities law or the consummation of any public offering of any of its securities; or (B) the adoption or implementation of any strategy (including decisions as to timing and pricing and the selection of a United States or foreign stock exchange or market) for purposes of the consummation of an underwritten public offering of its securities resulting in the admission or listing of its securities thereon (including a Qualified Public Offering); (xi) (A) (x) the amendment of, supplement to or waiver of any instrument evidencing, securing or otherwise relating to Indebtedness of the Operating Company or any of its Subsidiaries in excess of $1,000,000, or (y) the amendment of, supplement to or waiver of any instrument evidencing, securing or otherwise relating to Indebtedness of the Operating Company or any of its Subsidiaries lesser than $1,000,000 to the extent it would cause the Indebtedness of the Operating Company and its Subsidiaries on a consolidated basis to exceed $20,000,000; (B) (x) any incurrence after the date hereof by the Operating Company or any of its Subsidiaries of Indebtedness (including the drawing down on the existing credit facilities of the Operating Company or any of its Subsidiaries) exceeding at any time $20,000,000 on a consolidated basis, or (y) the amendment of, supplement to or waiver of any instrument evidencing, securing or otherwise relating to such Indebtedness; (C) the extension or refinancing of any Indebtedness of the Operating Company or any of its Subsidiaries, except in each case Indebtedness of the Operating Company or any of its wholly owned Subsidiaries owing to the Operating Company or such wholly owned Subsidiary, as the case may be; (xii) other than to the extent covered by Section 5.14(a)(viii), the direct or indirect sale, assignment, license, transfer or other disposition by the Atrium Group Companies of assets having a fair market value (taking into account, for purposes of valuing any such transaction the amount of debt, if any, assumed by the transferee and the maximum amount of deferred or contingent consideration, if any, to be received by the applicable seller), exceeding $10,000,000 in respect of a single transaction or a series of related transactions or $20,000,000 in the aggregate from the date of this Agreement, except for sales and dispositions of products and inventories in the ordinary course of business consistent with past practice; or (xiii) the taking of any action directly or indirectly in contemplation of the foregoing.

Supermajority Approval. Notwithstanding anything Neither any Member, Manager or officer shall have any authority to the contrary herein (but subject to Sections 4.5, 9.4, 9.5, 9.6, 9.7, and 9.8), the Company shall not (and the Company shall cause each other Atrium Company not to) take, authorize, facilitate or permit to occur take any of the following actions without the prior approval of (x) the Kenner Group, and (y) either the ML Group or the UBS Group (except that if enter into any agreement or arrangement to consummate any of the Kenner Group, the ML Group or the UBS Group owns less than 10% following actions on behalf of the Operating Company, or otherwise cause or permit the Company Share Equivalents then outstanding, only the approval to do any of the other two groups shall be required), which approval may only be given in accordance with Section 3.7(b):following without Supermajority Approval: (i) any change in the authorization or issuance, or the entry into any agreement (or into any amendment to such agreement) or the issuance of any instrument providing for, the authorization or issuance (contingent or otherwise) of, any shares of capital stock, equity-linked, derivative or other equity securities or other Convertible Securities of any Atrium Group Company (including the adoption of any stock option plan or other stock incentive plan or arrangement or the amendment of or supplement to any stock option plan), in each case information provided to the extent not covered by Section 5.14(a)(ix); provided, however, that the foregoing restrictions shall not apply to: (A) the issuance of 7,750 Operating Company Shares issuable upon exercise of the warrant issued by the Operating Company to Jeff L. Hull, dated December 10, 2003, (B) the issuance of ▇,▇▇▇ ▇▇▇▇▇▇▇▇▇ Company Shares issuable to Key Executives of the Operating Company Class A Members pursuant to the exercise of stock options to be issued on or after date hereof having an exercise price per share equal to $1000, (C) the authorization of an option pool covering 5,250 Operating Company Shares issuable to Key Executives of the Operating Company pursuant to the exercise of stock options to be issued on or after date hereof (which stock option issuances shall be subject to the restrictions set forth in this Section 5.14(b)(i)) having an exercise price per share greater than $1,000; and (D) the formation of or issuance of any such securities of any wholly owned Subsidiary of the Operating Company to the Operating Company or any other wholly owned Subsidiary of the Operating CompanyAgreement; (ii) (A) the approval of any Annual Budget, (B) any material amendment to an Approved Annual Budget, or (C) except to the extent necessary to effect an acquisition consented to in accordance with (or permitted by) Section 5.14(b)(v) or Section 5.14(b)(vi), the authorization in any one Fiscal Year (but not on a monthly basis) of any capital or operating expenditure or series of capital or operating expenditures by the Company or any other Atrium Group Company exceeding $1,000,000 in the aggregate, unless expressly provided for in the Approved Annual Budget; (iii) the appointment, or renewal of appointment of, or removal of the independent auditors of any Atrium Group Company (which in any event shall be at all times a Big Four Firm); (iv) the making of any changes to or departures from the accounting policies, practices or principles of any Atrium Group Company, other than as required by GAAP, applicable law or listing requirements; (v) the making by the Atrium Group Companies of any Investment; (vi) the acquisition of (A) tangible or intangible assets (including the acquisition of an existing business from another Person, or (B) a Controlling interest in another Person that is not a wholly owned Subsidiary of an Atrium Group Company (whether in the form of equity securities, equity-linked securities, derivative securities or convertible securities (including any interests in any partnership or joint venture)), by one or more Atrium Group Companies, including any capital expenditure not included in the Approved Budget, for an acquisition price in respect of any single acquisition or series of related acquisitions in excess of $10,000,000 or an acquisition price in the aggregate for all such acquisitions in excess of $40,000,000 in any "rolling" three-year period commencing on the date hereof (taking into account for purposes of valuing any such acquisition or series of related acquisitions the amount of debt, if any, assumed by the applicable Atrium Group Company and the maximum amount of deferred or contingent consideration, if any, to be paid by it in connection with such acquisition); provided, however, that this Section 5.14(b)(vi) shall not apply to the acquisition of inventory in the ordinary course of business consistent with past practice; (vii) except as expressly permitted by Section 4.2contemplated in any then valid Budget, the declaration or making of any dividend on or with respect to any limited liability company interest or capital stock or other equity interestpurchase, as the case may besell, of any Atrium Group Company or any other distribution to the Members or the stockholders of any Atrium Group Company of any assets or property of such Atrium Group Companylease, in each case other to the Operating Company or any of its wholly owned Subsidiaries; (viii) (A) the commencement of any legal action or any arbitration proceeding involving amounts in excess of $500,000 individually exchange, transfer, assign or otherwise material to any Atrium Group Companyacquire or dispose, or (B) the compromise or settlement of any legal action or any arbitration proceeding involving amounts whether in excess of $100,000 individually or otherwise material to any Atrium Group Company; (ix) (A) the designation, hiring, removal or replacement of any Key Executive, (B) the entry into an employment agreement with any Key Executive, or any amendment to, waiver, renewal or extension of, any material term of the employment agreement of such Key Executive (it being understood and agreed that any provision thereof relating to the compensation of such Key Executive shall be deemed material) or (C) the exercise of any right (but not the compliance with any obligation under) or the granting of any waiver under, any employment arrangement with any Key Executive entered into in compliance with this Agreement; (A) except pursuant to the Registration Rights Agreement, the registration of any of its securities under any applicable securities law or the consummation of any public offering of any of its securities; or (B) the adoption or implementation of any strategy (including decisions as to timing and pricing and the selection of a United States or foreign stock exchange or market) for purposes of the consummation of an underwritten public offering of its securities resulting in the admission or listing of its securities thereon (including a Qualified Public Offering); (xi) (A) (x) the amendment of, supplement to or waiver of any instrument evidencing, securing or otherwise relating to Indebtedness of the Operating Company or any of its Subsidiaries in excess of $1,000,000, or (y) the amendment of, supplement to or waiver of any instrument evidencing, securing or otherwise relating to Indebtedness of the Operating Company or any of its Subsidiaries lesser than $1,000,000 to the extent it would cause the Indebtedness of the Operating Company and its Subsidiaries on a consolidated basis to exceed $20,000,000; (B) (x) any incurrence after the date hereof by the Operating Company or any of its Subsidiaries of Indebtedness (including the drawing down on the existing credit facilities of the Operating Company or any of its Subsidiaries) exceeding at any time $20,000,000 on a consolidated basis, or (y) the amendment of, supplement to or waiver of any instrument evidencing, securing or otherwise relating to such Indebtedness; (C) the extension or refinancing of any Indebtedness of the Operating Company or any of its Subsidiaries, except in each case Indebtedness of the Operating Company or any of its wholly owned Subsidiaries owing to the Operating Company or such wholly owned Subsidiary, as the case may be; (xii) other than to the extent covered by Section 5.14(a)(viii), the direct or indirect sale, assignment, license, transfer or other disposition by the Atrium Group Companies of assets having a fair market value (taking into account, for purposes of valuing any such transaction the amount of debt, if any, assumed by the transferee and the maximum amount of deferred or contingent consideration, if any, to be received by the applicable seller), exceeding $10,000,000 in respect of a single transaction or a series of related transactions transactions, an asset or assets in a transaction that could reasonably be expected to result in payments made or received of more than $20,000,000 10,000,000; (iii) approve a loan from a Member (or an Affiliate of a Member) to the Company pursuant to Section 5.8; (iv) except as expressly contemplated in any then valid Budget, borrow, assume or guarantee, or otherwise incur or contract for, indebtedness in excess of $5,000,000, or pledge, create or incur any lien or other encumbrance on any assets of the Company in connection therewith; and amend or modify in any material respect any such arrangement; (v) loan money in excess of $1,000,000 other than to an entity wholly owned by the Company or advances or extensions of credit in the aggregate from the date form of this Agreement, except for sales and dispositions of products and inventories accounts receivable incurred in the ordinary course of business consistent business; (vi) other than in accordance with past practice; orSections 4.3(c), 5.2, 5.3(b), 5.4, 5.10, 5.11 or 9.1(f), issue, sell or otherwise dispose of any Membership Interests, except pursuant to any convertible security, call, option, warrant, subscription, purchase right or other contract or commitment previously approved by Supermajority Approval, or change the number of Membership Interests then outstanding whether by recapitalization, reclassification, split-up, combination, exchange, repurchase, acquisition or otherwise or take any action affecting the amount of Membership Interests then outstanding or altering the rights of outstanding Membership Interests set forth in this Agreement, including creating additional series or classes of Membership Interests; (vii) other than in accordance with Section 9.1(f), approve the admission of any Additional Member, including the terms of such Additional Member’s admission; (viii) forego making distributions pursuant to Section 6.5 in any quarter; (ix) set Short Term Cash Requirements in an amount in excess of zero; (x) approve any merger, consolidation or other combination of the Company, or participation of the Company in a share exchange, or sale of all or substantially all of the assets of the Company; (xi) assign all or substantially all of the Company’s assets in trust for creditors or on the assignee’s promise to pay its debts or file a voluntary petition commencing a bankruptcy, insolvency or similar Proceeding; (xii) approve the dissolution or liquidation of the Company or the appointment or designation of any Person other than the Board as Liquidating Trustee; (xiii) enter into any customer agreement that would be substantially likely to result in (or amend any existing customer agreement in a manner that would be substantially likely to result in) receipt by the taking Company of gross income in excess of $100,000 per annum (individually or in the aggregate) that would not constitute Qualifying Income; (xiv) approve any Capital Contribution in a form other than cash; (xv) make any distribution to a Member in a form other than cash; (xvi) take any “bonus depreciation” under Code section 168 (or other applicable provisions of the Code); (xvii) approve any New Project; (xviii) other than in accordance with Section 12.3, approve any amendment to this Agreement or to the Charter Documents of the Company or waive any provisions of this Agreement; (xix) take any action or engage in any business beyond the scope of the Business; (xx) approve the certification of any action directly Membership Interests or indirectly in contemplation the issuance to any Member of any certificate representing the Membership Interests held by such Member; (xxi) approve the Construction Budget or any LLC Budget; (xxii) approve any amendment to any Budget; (xxiii) approve any operation and management agreement, management services agreement or any similar agreement for the general operation and management of the foregoingBusiness and the assets of the Company; (xxiv) except as expressly contemplated in any then valid Budget, approve any capital expenditure in excess of $5,000,0000; (xxv) approve any amendment to the Construction Management Agreement, the Design Basis, the scope and parameters of the Project, or the Design and Development Outside Date; (xxvi) except as provided in Section 4.3(c), approve the aggregate Equity Percentage Interest of the Class B Members to be greater or less than [**]; (xxvii) issue or incur any indebtedness during any period other than Phase I, or issue or incur any indebtedness during Phase I that (A) has a term that extends for a period in excess of three (3) years following the Commercial Operation Date; (B) is not nonrecourse to the Members; or (C) has an interest rate of more than LIBOR plus four percent (4%); (xxviii) issue or incur indebtedness that causes the Company’s ratio of indebtedness to total capitalization to exceed fifty percent (50%) at any time (for purposes hereof, “total capitalization” shall mean the sum of the total indebtedness of the Company plus the total amount of Capital Contributions made on or prior to the date of calculation); (xxix) approve any Other Capital Call pursuant to Section 5.2(d)(i) or 5.2(d)(iii); (xxx) grant Principal Member status to any Approved Additional Initial Member; (xxxi) except as otherwise set forth in this Agreement, permit the withdrawal of a Member; (xxxii) except as otherwise required by Law, approve any policies or procedures with respect to regulatory, environmental and risk management standards; (xxxiii) approve an outside expert pursuant to Section 6.6 other than PricewaterhouseCoopers LLP; and (xxxiv) perform any act in contravention of this Agreement.