Common use of Board Representation Clause in Contracts

Board Representation. (a) On the Issuance Date, the Initial Warrant Holder shall have the right to designate two directors (each, a “GGC Appointee”) who shall be appointed to the Board. The initial GGC Appointees shall be Xxxxxx X. Xxxxxxx and Xxxxx Xxxxxx. As of the Issuance Date, the number of seats on the Board shall be set at eight, which shall consist on the Issuance Date of the initial GGC Appointees, Xxxxxxx X. Xxxxxxx, Xxxxx X. Xxxxxx, Xxxxx Xxxxxxxxx, Xxxx X. Xxxx, Xx. and Xxxxxxx X. Xxxxxxxx, and one seat shall be vacant. The Initial Warrant Holder may propose an additional candidate for election to the Board who meets all relevant standards for independence to fill such initial vacancy. If that candidate is reasonably acceptable to the Nominating Committee of the Board and a majority of the independent members of the Board, that candidate will be promptly elected to the Board following such proposal by the Initial Warrant Holder (and such candidate shall not be deemed to be a GGC Appointee for purposes hereof). For the period from the Issuance Date to the date immediately following the next annual meeting of shareholders of the Company following the Issuance Date, the size of the Board shall be maintained at eight directors. Xxxx X. Xxxx, Xx. shall not stand for reelection at the next annual meeting of shareholders of the Company following the Issuance Date, and on the date immediately following such annual meeting, the number of seats on the Board shall be set at seven (provided that if the initial vacancy described above has not been filled with a director meeting all applicable independence requirements at such time, Xxxx X. Xxxx, Xx. shall continue to serve on the Board until such time as such director is appointed to the Board). Notwithstanding the foregoing, if for any reason the size of the Board is increased above eight seats prior to the date immediately following the next annual meeting of shareholders of the Company following the Issuance Date, or above seven seats thereafter, and any additional vacant seat created by such increase is filled by the Board with a director that is neither proposed nor approved by the Initial Warrant Holder or the GGC Appointees, then the Initial Warrant Holder shall be entitled to appoint one additional director to the Board, which director shall also be deemed to be a GGC Appointee for purposes hereof (it being understood that no increase in the size of the Board and filling of any vacancy created by such increase that would give rise to a right of the Initial Warrant Holder to appoint an additional GGC Appointee in accordance with the foregoing shall be made unless the Certificate of Incorporation then permits such number of additional seats as is necessary to allow for the additional GGC Appointee if required pursuant to this Section 9.04(a)).

Board Representation. (a) On Unless otherwise increased by a majority of the Issuance DateHolders of the issued and outstanding Securities in accordance with the DGCL, the Initial Warrant Holder Board shall consist of nine (9) directors, five being appointed by the HMTF Group, two being appointed by the BSMB Group, one being appointed by the Trust (each of HMTF Group, BSMB Group and the Trust, a "Nominating Holder," and each such director so appointed, a "Party Designee") and one of whom shall be the chief executive officer of the Company. To the extent that the Board is increased as contemplated in the preceding sentence, the HMTF Group shall always (subject to Section 2.1.3) have the right to appoint a majority of the Board and, so long as the HMTF Group has the right to and does appoint a majority of such increased Board, the BSMB Group shall have the right (subject to designate two directors (each, a “GGC Appointee”Section 2.1.3) who shall be appointed to the Board. The initial GGC Appointees shall be Xxxxxx X. Xxxxxxx and Xxxxx Xxxxxx. As appoint that percentage of the Issuance Date, members of the number of seats on increased Board (and the Board shall be set further increased if reasonably required to so accomplish the desired result) that is as close as practicable to the ratio of seven (7) board members for the HMTF Group for every three (3) board members for the BSMB Group. Each Holder shall vote his or its shares of Securities at eight, which shall consist on the Issuance Date any regular or special meeting of stockholders of the initial GGC Appointees, Xxxxxxx X. Xxxxxxx, Xxxxx X. Xxxxxx, Xxxxx Xxxxxxxxx, Xxxx X. Xxxx, Xx. Company or in any written consent executed in lieu of such a meeting of stockholders and Xxxxxxx X. Xxxxxxxx, and one seat shall be vacant. The Initial Warrant Holder may propose an additional candidate for election take all other actions required by the DGCL to give effect to the Board who meets all relevant standards for independence to fill such initial vacancy. If that candidate is reasonably acceptable to agreements contained in this Stockholders' Agreement (including without limitation the election of persons designated by the Nominating Committee Holders to be elected as directors as described in the preceding sentence) and to ensure that the certificate of incorporation of the Board Company and a majority bylaws of the independent members of the Board, that candidate will be promptly elected to the Board following such proposal by the Initial Warrant Holder (and such candidate shall not be deemed to be a GGC Appointee for purposes hereof). For the period from the Issuance Date to the date Company as in effect immediately following the next Effective Date do not, at any time thereafter, conflict in any respect with the provisions of this Stockholders' Agreement. In order to effectuate the provisions of this Section 2.1, each of the HMTF Group or the BSMB Group hereby agrees that when any action or vote is required to be taken by such Holder pursuant to this Stockholders' Agreement, such Holder shall use his or its best efforts to call, or cause the appropriate officers and directors of the Company to call, a special or annual meeting of shareholders stockholders of the Company following Company, as the Issuance Datecase may be, and each Holder agrees when any action or vote is required to be taken by such Holder pursuant to this Agreement, such Holder shall execute or cause to be executed a consent in writing in lieu of any such meetings pursuant to Section 228(a) of the size of DGCL if requested by the Board. Any committee formed by the Board shall be maintained at eight directors. Xxxx X. Xxxx, Xx. shall not stand for reelection at the next annual meeting of shareholders include one (1) or more representatives of the Company following HMTF Group and the Issuance Date, and on the date immediately following such annual meeting, the number of seats on the Board shall be set at seven (provided that if the initial vacancy described above has not been filled with a director meeting all applicable independence requirements at such time, Xxxx X. Xxxx, Xx. shall continue BSMB Group unless otherwise consented to serve on the Board until such time as such director is appointed to the Board). Notwithstanding the foregoing, if for any reason the size of the Board is increased above eight seats prior to the date immediately following the next annual meeting of shareholders of the Company following the Issuance Date, or above seven seats thereafter, and any additional vacant seat created by such increase is filled by the Board with a director that is neither proposed nor approved by the Initial Warrant Holder or the GGC Appointees, then the Initial Warrant Holder shall be entitled to appoint one additional director to the Board, which director shall also be deemed to be a GGC Appointee for purposes hereof (it being understood that no increase in the size of the Board and filling of any vacancy created by such increase that would give rise to a right of the Initial Warrant Holder to appoint an additional GGC Appointee in accordance with the foregoing shall be made unless the Certificate of Incorporation then permits such number of additional seats as is necessary to allow for the additional GGC Appointee if required pursuant to this Section 9.04(a))Required Holders.

Board Representation. (a) On the Issuance DateThe Stockholders, the Initial Warrant Holder collectively, shall have the right to designate two directors (each, a “GGC Appointee”) who shall be appointed to the Board. The initial GGC Appointees shall be Xxxxxx X. either Xxxxxxx and Xxxxx Xxxxxx. As of the Issuance Date, the number of seats on the Board shall be set at eight, which shall consist on the Issuance Date of the initial GGC Appointees, Xxxxxxx X. or Xxxx Xxxxxxx, Xxxxx X. Xxxxxxas they may choose, Xxxxx Xxxxxxxxx, Xxxx X. Xxxx, Xx. and Xxxxxxx X. Xxxxxxxx, and one seat shall be vacant. The Initial Warrant Holder may propose an additional candidate for election to the Board who meets all relevant standards for independence to fill Company's board of directors by such initial vacancy. If that candidate is reasonably acceptable to board at the Nominating Committee closing of the Board and a majority of the independent members of the Board, that candidate will be promptly elected to the Board following such proposal transactions contemplated by the Initial Warrant Holder (and such candidate shall not be deemed Purchase Agreement, to be a GGC Appointee for purposes hereof). For the period from the Issuance Date to the date immediately following serve until the next annual meeting of shareholders the stockholders of the Company. Thereafter, if any one of Xxxxxxx Xxxxxxx or Xxxx Xxxxxxx (i) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company following or is subject to the Issuance Datenoncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the size "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of the Board shall be maintained nominees for election at eight directors. Xxxx X. Xxxx, Xx. shall not stand for reelection at the next each annual meeting of shareholders the stockholders of the Company following at the Issuance Dateexpiration of his term, for so long as such Stockholder meets the Board Qualifications. If, however, both Xxxxxxx Xxxxxxx and on Xxxx Xxxxxxx meet the date immediately following such annual meetingBoard Qualifications, the number Stockholders shall choose one of seats on the Board shall them to be set at seven (provided that if the initial vacancy described above has not been filled with a director meeting all applicable independence requirements at such time, Xxxx X. Xxxx, Xx. shall continue to serve on the Board until such time as such director is appointed nominated for election to the Board). Notwithstanding Company's Board of Directors and the foregoing, if Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for any reason the size of the Board is increased above eight seats prior to the date immediately following the next election at each annual meeting of shareholders the stockholders of the Company following at the Issuance Dateexpiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or above seven seats thereafterthe distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of Xxxxxxx Xxxxxxx and any additional vacant seat created by such increase Xxxx Xxxxxxx is filled by not a member of the Company's Board of Directors to be invited to attend meetings of the Company's Board of Directors as an observer (so long as he is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company), unless the Board with a director that is neither proposed nor approved by the Initial Warrant Holder or the GGC Appointees, then the Initial Warrant Holder shall be entitled to appoint one additional director to the Board, which director shall also be deemed to be a GGC Appointee for purposes hereof (it being understood that no increase in the size of Directors of the Board and filling Company determines as to any particular meeting or meetings that considerations of any vacancy created by confidentiality make such increase that would give rise to a right of the Initial Warrant Holder to appoint an additional GGC Appointee in accordance with the foregoing shall be made unless the Certificate of Incorporation then permits such number of additional seats as is necessary to allow for the additional GGC Appointee if required pursuant to this Section 9.04(a))attendance inappropriate.

Board Representation. (a) On the Issuance DateThe Stockholders, the Initial Warrant Holder collectively, shall have the right to designate two directors (each, a “GGC Appointee”) who shall be appointed to the Board. The initial GGC Appointees shall be Xxxxxx X. either Leonxxx Xxxxxxx and Xxxxx Xxxxxx. As of the Issuance Date, the number of seats on the Board shall be set at eight, which shall consist on the Issuance Date of the initial GGC Appointees, Xxxxxxx X. xx Eric Xxxxxxx, Xxxxx X. Xxxxxxxx they may choose, Xxxxx Xxxxxxxxx, Xxxx X. Xxxx, Xx. and Xxxxxxx X. Xxxxxxxx, and one seat shall be vacant. The Initial Warrant Holder may propose an additional candidate for election to the Board who meets all relevant standards for independence to fill Company's board of directors by such initial vacancy. If that candidate is reasonably acceptable to board at the Nominating Committee closing of the Board and a majority of the independent members of the Board, that candidate will be promptly elected to the Board following such proposal transactions contemplated by the Initial Warrant Holder (and such candidate shall not be deemed Purchase Agreement, to be a GGC Appointee for purposes hereof). For the period from the Issuance Date to the date immediately following serve until the next annual meeting of shareholders the stockholders of the Company. Thereafter, if any one of Leonxxx Xxxxxxx xx Eric Xxxxxxx (x) holds at least 400,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or the distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction) and (ii) is either an employee of the Company following or is subject to the Issuance Datenoncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and the Company ((i) and (ii) above, the size "Board Qualifications"), the Company agrees to cause such Stockholder to be included in management's slate of the Board shall be maintained nominees for election at eight directors. Xxxx X. Xxxx, Xx. shall not stand for reelection at the next each annual meeting of shareholders the stockholders of the Company following at the Issuance Dateexpiration of his term, and on for so long as such Stockholder meets the date immediately following such annual meetingBoard Qualifications. If, however, both Leonxxx Xxxxxxx xxx Eric Xxxxxxx xxxt the Board Qualifications, the number Stockholders shall choose one of seats on the Board shall them to be set at seven (provided that if the initial vacancy described above has not been filled with a director meeting all applicable independence requirements at such time, Xxxx X. Xxxx, Xx. shall continue to serve on the Board until such time as such director is appointed nominated for election to the Board). Notwithstanding Company's Board of Directors and the foregoing, if Company agrees to cause such Stockholder so chosen to be included in management's slate of nominees for any reason the size of the Board is increased above eight seats prior to the date immediately following the next election at each annual meeting of shareholders the stockholders of the Company following at the Issuance Dateexpiration of his term, for so long as such Stockholder meets the Board Qualifications. Further, for so long as the Stockholders collectively own in the aggregate not less than 800,000 shares of Common Stock (which threshold number of shares shall automatically be adjusted from time to time to reflect increases, decreases or exchanges in, or above seven seats thereafterthe distribution of additional or different securities in respect of, the Common Stock as a result of any recapitalization, reclassification, stock dividend, stock split, reverse stock split or other similar transaction), the Company agrees to cause whichever of Leonxxx Xxxxxxx xxx Eric Xxxxxxx xx not a member of the Company's Board of Directors to be invited to attend meetings of the Company's Board of Directors as an observer (so long as he is either an employee of the Company or is subject to the noncompetition covenants of Article VII of the Purchase Agreement or Section 7 of the Employment Agreement of even date herewith between him and any additional vacant seat created by such increase is filled by the Company), unless the Board with a director that is neither proposed nor approved by the Initial Warrant Holder or the GGC Appointees, then the Initial Warrant Holder shall be entitled to appoint one additional director to the Board, which director shall also be deemed to be a GGC Appointee for purposes hereof (it being understood that no increase in the size of Directors of the Board and filling Company determines as to any particular meeting or meetings that considerations of any vacancy created by confidentiality make such increase that would give rise to a right of the Initial Warrant Holder to appoint an additional GGC Appointee in accordance with the foregoing shall be made unless the Certificate of Incorporation then permits such number of additional seats as is necessary to allow for the additional GGC Appointee if required pursuant to this Section 9.04(a))attendance inappropriate.

Board Representation. (a) On the Issuance Date, the Initial Warrant Holder shall have the right See Section 13 of this Offer to Purchase entitled “The Transaction Documents.” Engility is entitled to designate two directors (each, at least a “GGC Appointee”) who shall be appointed to the Board. The initial GGC Appointees shall be Xxxxxx X. Xxxxxxx and Xxxxx Xxxxxx. As majority of the Issuance Date, directors of DRC following the number of seats on the Board shall be set at eight, which shall consist on the Issuance Date consummation of the initial GGC AppointeesOffer. It is currently anticipated that Engility will designate Xxxx Xxxxxxxxxxxx, Xxxxxxx X. Xxxxx, Xxxxxx X. Xxxxxxx, Xxxxx X. Xxxxxx, Xxxxx Xxxxxxxxx, Xxxx X. Xxxx, Xx. Xxxxxx X. Xxxxxx and Xxxxxxx X. XxxxxxxxXxxxxxxxx to serve as directors of DRC following the consummation of the Offer. Purchaser expects that such representation would permit Purchaser to exert substantial influence over DRC’s conduct of its business and operations, however, pending the consummation of the Merger, Engility intends to keep DRC as an independent subsidiary under its own management. Short-form Merger. Under the MBCA, if Purchaser acquires, pursuant to the Offer, at least ninety percent (90%) of the outstanding Shares (the “Short Form Threshold”), Purchaser will be able to approve the Merger without a vote of the DRC Board or shareholders. In such event, Engility and one seat shall Purchaser anticipate that they will take all necessary and appropriate action to cause the Merger to become effective as soon as reasonably practicable after such acquisition, without adoption by the DRC Board or the approval of DRC’s shareholders. However, if Purchaser does not acquire at least ninety percent (90%) of the outstanding Shares pursuant to the Offer or otherwise (including through the exercise of the Top-Up Option) and an approving vote of DRC’s shareholders is required under the MBCA, a significantly longer period of time would be vacantrequired to effect the Merger. Provided that Purchaser has acquired and paid for the Shares tendered pursuant to the Offer and following the expiration of any subsequent offering period provided pursuant to the Merger Agreement, DRC has agreed to establish a record date for, call, give notice of, convene and hold a meeting of its shareholders as promptly as reasonably practicable following consummation of the Offer to consider and vote on the Merger, if a shareholders’ vote is required. Rule 13e-3. The Initial Warrant Holder SEC has adopted Rule 13e-3 under the Exchange Act, which is applicable to certain “going private” transactions and under certain circumstances may propose an additional candidate for election be applicable to the Board who meets all relevant standards for independence Merger or another business Table of Contents combination following the purchase of Shares pursuant to fill such initial vacancythe Offer or otherwise in which Purchaser seeks to acquire the remaining Shares not held by it. Xxxxxxxxx believes, however, that Rule 13e-3 will not be applicable to the Merger if the Merger is consummated within one year after the Expiration Date at the same per Share price as paid in the Offer. If applicable, Rule 13e-3 requires, among other things, that candidate is reasonably acceptable certain financial information concerning DRC and certain information relating to the Nominating Committee fairness of the Board proposed transaction and a majority the consideration offered to minority shareholders in such transaction be filed with the SEC and disclosed to shareholders prior to consummation of the independent members of the Boardtransaction. Plans for DRC. It is expected that, that candidate will be promptly elected to the Board following such proposal by the Initial Warrant Holder (and such candidate shall not be deemed to be a GGC Appointee for purposes hereof). For the period from the Issuance Date to the date immediately initially following the next annual meeting of shareholders of the Company following the Issuance DateMerger, the size business and operations of DRC will, except as set forth in this Offer to Purchase, be continued substantially as they are currently being conducted and that Engility will eventually integrate the Board shall be maintained at eight directors. Xxxx X. Xxxx, Xx. shall not stand for reelection at the next annual meeting business and operations of shareholders of the Company following the Issuance Date, and on the date immediately following such annual meeting, the number of seats on the Board shall be set at seven (provided that if the initial vacancy described above has not been filled with a director meeting all applicable independence requirements at such time, Xxxx X. Xxxx, Xx. shall continue to serve on the Board until such time as such director is appointed to the Board)DRC into Engility’s business. Notwithstanding the foregoing, if for any reason Engility will continue to evaluate the size business and operations of DRC during the pendency of the Board is increased above eight seats prior to Offer and after the date immediately following the next annual meeting of shareholders consummation of the Company following Offer and the Issuance DateMerger and will take all relevant actions as it deems appropriate under the circumstances then existing. Engility intends to review all relevant information as part of a comprehensive review of DRC’s business, or above seven seats thereafteroperations, capitalization and any additional vacant seat created by such increase is filled by the Board management with a director view to optimizing DRC’s potential within Engility. Extraordinary Corporate Transactions. Except as described above or elsewhere in this Offer to Purchase, Engility and Purchaser have no present plans or proposals that is neither proposed nor approved by the Initial Warrant Holder would relate to or the GGC Appointeesresult in an extraordinary corporate transaction involving DRC or any of its subsidiaries (such as a merger, then the Initial Warrant Holder shall be entitled to appoint one additional director to the Boardreorganization, which director shall also be deemed to be a GGC Appointee for purposes hereof (it being understood that no increase in the size of the Board and filling liquidation, relocation of any vacancy created by such increase that would give rise to operations or sale or other transfer of a right material amount of the Initial Warrant Holder to appoint an additional GGC Appointee assets), any change in accordance with the foregoing shall be made unless the Certificate of Incorporation then permits such number of additional seats as is necessary to allow for the additional GGC Appointee if required pursuant to this Section 9.04(a))DRC’s management, any material change in DRC’s capitalization or dividend policy or any other material change in DRC’s corporate structure or business.

Board Representation. (a) On or at any time within 90 days after the Issuance Closing Date, Purchaser may provide the Company with (i) the name of an individual (the "TLC Initial Warrant Holder Nominee") Purchaser recommends be appointed to the Company's Board of Directors (the "Board"), and (ii) all information related to the TLC Initial Nominee as would be required by Regulation 14A promulgated by the SEC under the Exchange Act to be included in a proxy statement related to a meeting of the Company's stockholders at which directors would be elected (the "Proxy Information"). Within 30 days after the Company's receipt of all Proxy Information relating to such individual, the Board shall consider the qualifications of the TLC Initial Nominee and, subject to its fiduciary duties, either appoint the TLC Initial Nominee to serve on the Board until the next election of directors by the Company's stockholders or notify Purchaser that the Board has determined that such appointment would not be consistent with the Board's fiduciary duties. At any time within 90 days after the Company's notifies Purchaser of the Board's determination not to appoint the TLC Initial Nominee, Purchaser may provide the Company with the name of, together with Proxy Information relating to, one or more individuals (the "TLC Alternative Nominee") that Purchaser recommends be appointed to the Board. Within 30 days after the Company's receipt of all Proxy Information relating to the TLC Alternative Nominee, the Board shall consider the qualifications of such TLC Alternative Nominee and, subject to its fiduciary duties, either appoint the TLC Alternative Nominee to serve on the Board until the next election of directors by the Company's stockholders or notify Purchaser that the Board has determined that such appointment would not be consistent with the Board's fiduciary duties. This process shall continue until the Board and Purchaser have agreed upon an individual nominated by Purchaser to serve on the Board (the "TLC Nominee"). The Company shall increase the size of the Company's Board of Directors to the extent necessary to accommodate the appointment of the TLC Nominee. Thereafter, for as long as Purchaser holds of record (such amount to be determined by considering the total of the following (i) the number of full shares of Common Stock into which shares of Preferred Stock then held by Purchaser could be converted pursuant to terms of the Certificate of Designation, and (ii) that number of full shares of Common Stock then held by the Purchaser) at least 7.5% of the Common Stock outstanding on any date the Board fixes the record date for the meeting of the Company's stockholders at which directors will be elected, Purchaser shall have the right to designate two a nominee to stand for election as a director at the next meeting at which directors (eachare to be elected. If such nominee of the Purchasers is not the TLC Nominee, a “GGC Appointee”) who shall be appointed then similar to the Board. The initial GGC Appointees process described in the first four sentences of this Section 4.6, Purchaser shall be Xxxxxx X. Xxxxxxx and Xxxxx Xxxxxx. As of the Issuance Date, the number of seats on the Board shall be set at eight, which shall consist on the Issuance Date of the initial GGC Appointees, Xxxxxxx X. Xxxxxxx, Xxxxx X. Xxxxxx, Xxxxx Xxxxxxxxx, Xxxx X. Xxxx, Xx. and Xxxxxxx X. Xxxxxxxx, and one seat shall be vacant. The Initial Warrant Holder may propose submit recommendations for an additional candidate individual to stand for election as a director and the Proxy Information related thereto to the Board who meets all relevant standards for independence to fill such initial vacancy. If that candidate is reasonably acceptable to the Nominating Committee committee of the Board and a majority responsible for director nominations. Such committee shall consider the qualifications of the independent members such individual and, subject to its fiduciary duties, either nominate such individual for election at such meeting of the Board, stockholders or notify Purchaser that candidate will be promptly elected to the Board following such proposal by the Initial Warrant Holder (and committee has determined that such candidate shall appointment would not be deemed consistent with its fiduciary duties (in which case the process shall continue until the committee and Purchaser have agreed upon an individual to be a GGC Appointee for purposes hereof). For the period from the Issuance Date to the date immediately following the next annual meeting of shareholders of the Company following the Issuance Date, the size of the Board shall be maintained at eight directors. Xxxx X. Xxxx, Xx. shall not stand for reelection election as a director at the next annual meeting of shareholders of the Company following the Issuance Date, and on the date immediately following such annual meeting, the number of seats on the Board shall be set at seven (provided that if the initial vacancy described above has not been filled with a director meeting all applicable independence requirements at such time, Xxxx X. Xxxx, Xx. shall continue to serve on the Board until such time as such director is appointed to the Board). Notwithstanding the foregoing, if for any reason the size of the Board is increased above eight seats prior to the date immediately following the next annual meeting of shareholders of the Company following the Issuance Date, or above seven seats thereafter, and any additional vacant seat created by such increase is filled by the Board with a director that is neither proposed nor approved by the Initial Warrant Holder or the GGC Appointees, then the Initial Warrant Holder shall be entitled to appoint one additional director to the Board, which director shall also be deemed directors are to be a GGC Appointee for purposes hereof (it being understood that no increase in the size of the Board and filling of any vacancy created by such increase that would give rise to a right of the Initial Warrant Holder to appoint an additional GGC Appointee in accordance with the foregoing shall be made unless the Certificate of Incorporation then permits such number of additional seats as is necessary to allow for the additional GGC Appointee if required pursuant to this Section 9.04(a)elected).

Board Representation. (a) On If, and only if, a financing that is in the Issuance Dateform of equity securities of Refocus Group is completed by Verus International, or designees or agents introduced to Refocus Group by Verus International, on or prior to December 31, 2004, and such financing results in gross proceeds to Refocus Group in an aggregate amount of at least $2,000,000, excluding the Initial Warrant Holder outstanding principal balance and interest due under the notes issued pursuant to the Loan Agreement on the date of consummation of such financing, then Verus International shall have the right be entitled to designate two directors (each, a “GGC Appointee”) who shall one nominee to be elected or appointed to the Board. The initial GGC Appointees board of directors of Refocus Group; provided, however, such nominee shall be Xxxxxx X. Xxxxxxx and Xxxxx Xxxxxx. As of the Issuance Date, the number of seats on the Board shall be set at eight, which shall consist on the Issuance Date of the initial GGC Appointees, Xxxxxxx X. Xxxxxxx, Xxxxx X. Xxxxxx, Xxxxx Xxxxxxxxx, Xxxx X. Xxxx, Xx. and Xxxxxxx X. Xxxxxxxx, and one seat shall be vacant. The Initial Warrant Holder may propose an additional candidate for election to the Board who meets all relevant standards for independence to fill such initial vacancy. If that candidate is reasonably acceptable to the Nominating Committee of the Board and a majority of the independent members of the Boardboard of directors of Refocus Group (as to whom, that candidate will be promptly elected to the Board following such proposal by the Initial Warrant Holder (and such candidate shall not be Andrew P. Merkatz is deemed to be a GGC Appointee for purposes hereofacceptable). For the period from the Issuance Date Upon such designatiox, Xxxxxxx Xxxxx shall take, or cause to the date immediately following the next annual meeting of shareholders of the Company following the Issuance Datebe taken, the size of the Board shall all action within its power to cause such nominee to be maintained at eight directors. Xxxx X. Xxxx, Xx. shall not stand for reelection at the next annual meeting of shareholders of the Company following the Issuance Date, and on the date immediately following such annual meeting, the number of seats on the Board shall be set at seven (provided that if the initial vacancy described above has not been filled with a director meeting all applicable independence requirements at such time, Xxxx X. Xxxx, Xx. shall continue to serve on the Board until such time as such director is elected or appointed to the Board)board of directors of Refocus Group, including recommending to stockholders of Refocus Group that they vote for the election of such nominee to the board of directors of Refocus Group. Notwithstanding anything in this Agreement to the foregoingcontrary, in no event shall a nominee designated by Verus International, if for any reason such designation is allowed under the size terms of the Board is increased above eight seats prior to the date immediately following the next annual meeting of shareholders of the Company following the Issuance Datethis Agreement, or above seven seats thereafter, and any additional vacant seat created by such increase is filled by the Board with a director that is neither proposed nor approved by the Initial Warrant Holder or the GGC Appointees, then the Initial Warrant Holder shall be entitled to appoint one additional serve as a director of Refocus Group after December 31, 2006. Verus International hereby agrees that, as a condition to the Boardnomination of any person designated by Verus International under this paragraph 2, Verus International shall cause such nominee to execute an acknowledgment and resignation letter pursuant to which director shall also be deemed the nominee acknowledges the terms of this paragraph and tenders his resignation from the Board of Directors effective December 31, 2006. Refocus Group shall, to be a GGC Appointee for purposes hereof (it being understood that no increase in the size fullest extent permitted under applicable law, indemnify and hold harmless, all of the Board directors of Refocus Group, including the nominee designated by Verus International, against any costs or expenses (including reasonable attorneys' fees), judgments, fines, losses, claims, damages and filling liabilities incurred in connection with, and in amounts paid in settlement of, any claim, action, suit, proceeding or investigation, whether civil, criminal, administrative or investigative and wherever asserted, brought or filed, arising out of or pertaining to any vacancy created acts or omissions, or alleged acts or omissions, by such increase that would give rise to a right the directors of the Initial Warrant Holder to appoint an additional GGC Appointee Refocus Group in accordance with the foregoing shall be made unless the Certificate of Incorporation then permits such number of additional seats as is necessary to allow for the additional GGC Appointee if required pursuant to this Section 9.04(a))their respective capacities.

Board Representation. (a) On the Issuance DateClosing Date of the Secondary Financing, the Initial Warrant Holder shall have Company will appoint three (3) individuals, designated in writing by the right Xxxxxxxxx Funds, each of whom meets the qualifications to designate two directors (eachbe a Xxxxxxxxx Nominee and one whom meets the qualifications to be a Xxxxxxxxx Independent Director Nominee, a “GGC Appointee”) who shall to become and serve as members of the respective Boards of Directors of the Company and each Bank Entity effective on the date as of which all approvals or clearances required to be appointed received from the FRB or the DFI for appointments to the Board. The initial GGC Appointees shall be Xxxxxx X. Xxxxxxx Board of Directors have been received until the Company’s next annual shareholders meeting and Xxxxx Xxxxxx. As until a successor director to each such Xxxxxxxxx Nominee is elected and qualified; provided, however, that notwithstanding the foregoing, if 100% of the Issuance DatePurchased Shares are not Beneficially Owned by the Investor at the closing of the Secondary Financing, then the number of seats individuals the Xxxxxxxxx Funds shall be entitled to nominate to the respective Boards of Directors of the Company and each Bank Entity shall be determined pursuant to subparagraphs (i), (ii), (iii) and (iv) below. Effective upon the their appointment to the Boards of Directors, the three (3) Xxxxxxxxx Nominees referred to in this Section 5(a) will be eligible (but not required) to serve as a member of the respective committees of the Boards of Directors of the Company and each Bank Entity as determined by the Boards of Directors of the Company and each Bank Entity, provided that, each respective Xxxxxxxxx Nominee satisfies requirements in applicable law, rule or regulation with regard to service on such committee. Effective upon the closing of the Secondary Financing, the Xxxxxxxxx Independent Director Nominee, if he or she meets the requirements of Rule 10A 3 under the Exchange Act, will be eligible to serve as a member of the respective Audit Committee of the Board shall be set at eight, which shall consist on the Issuance Date of Directors of the initial GGC Appointees, Xxxxxxx X. Xxxxxxx, Xxxxx X. Xxxxxx, Xxxxx Xxxxxxxxx, Xxxx X. Xxxx, Xx. and Xxxxxxx X. Xxxxxxxx, and one seat shall be vacantCompany as determined by the Board of Directors of the Company. The Initial Warrant Holder may propose an additional candidate respective Boards of Directors of the Company and each Bank Entity shall nominate such Xxxxxxxxx Nominees and the Xxxxxxxxx Independent Director Nominee, or any person designated by the Xxxxxxxxx Funds to serve in any Nominee’s place that meets the qualifications to be a Xxxxxxxxx Independent Director Nominee or Xxxxxxxxx Nominee, for election to the Board who meets all relevant standards for independence to fill such initial vacancy. If that candidate is reasonably acceptable to the Nominating Committee respective Boards of the Board and a majority of the independent members of the Board, that candidate will be promptly elected to the Board following such proposal by the Initial Warrant Holder (and such candidate shall not be deemed to be a GGC Appointee for purposes hereof). For the period from the Issuance Date to the date immediately following the next annual meeting of shareholders Directors of the Company following the Issuance Date, the size of the Board shall be maintained and each Bank Entity for an additional one year term at eight directors. Xxxx X. Xxxx, Xx. shall not stand for reelection at the next annual each meeting of their respective shareholders of the Company following the Issuance Dateat which directors are elected, and on the date immediately following such annual meeting, the number of seats on the Board shall be set at seven (provided that if the initial vacancy described above has not been filled with a director meeting all applicable independence requirements at such time, Xxxx X. Xxxx, Xx. shall continue to serve on the Board until such time as such director is appointed to the Board). Notwithstanding Xxxxxxxxx Funds Beneficially Owns a lesser percentage of Purchased Shares as follows (the foregoing, if for any reason the size of the Board is increased above eight seats prior to the date immediately following the next annual meeting of shareholders of the Company following the Issuance Date, or above seven seats thereafter, and any additional vacant seat created by such increase is filled by the Board with a director that is neither proposed nor approved by the Initial Warrant Holder or the GGC Appointees, then the Initial Warrant Holder shall be entitled to appoint one additional director to the Board, which director shall also be deemed to be a GGC Appointee for purposes hereof (it being understood that no increase in the size of the Board and filling of any vacancy created by such increase that would give rise to a right of the Initial Warrant Holder to appoint an additional GGC Appointee in accordance with the foregoing shall be made unless the Certificate of Incorporation then permits such number of additional seats as is necessary to allow for the additional GGC Appointee if required pursuant to this Section 9.04(a)).“Purchased Shares Percentages”):