Exhibit 2.1

 

 

 

AMENDED AND RESTATED JOINT ACTION AGREEMENT

of

AVIANCA HOLDINGS S.A.

dated as of November 29, 2018

 

 

 

TABLE OF CONTENTS

Page

 

ARTICLE I        DEFINITIONS			2
Section 1.01        Certain Defined Terms			2
Section 1.02        Other Defined Terms			8
ARTICLE II                 REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS			9
Section 2.01        Organization and Authority			9
Section 2.02        No Conflict			9
ARTICLE III        GOVERNANCE			10
Section 3.01        General			10
Section 3.02        Agreement to Vote			10
Section 3.03        Size and Composition of Board			11
Section 3.04        Board Meetings			14
Section 3.05        Nomination and Election of Directors			15
Section 3.06        Removal of Directors: Vacancies			15
Section 3.07        Approval Required			16
Section 3.08        Officers			20
Section 3.09        Termination of Certain Rights			21
ARTICLE IV        TRANSFER OF SHARES			21
Section 4.01        Legends			21
Section 4.02        Certain Restrictions on Sale and Encumbrance			21
Section 4.03        Improper Sale or Encumbrance			22
Section 4.04        Tag-Along Right			23
ARTICLE V        ANNUAL BUSINESS PLAN AND BUDGET			26
Section 5.01        Annual Business Plan and Budget			26
ARTICLE VI        ADDITIONAL AGREEMENTS			26
Section 6.01        Certain Transferees to Execute Agreement			26
Section 6.02        Conversion Rights			27
ARTICLE VII        MISCELLANEOUS			28
Section 7.01        Termination			28
Section 7.02        Notices			29
Section 7.03        Press Releases			29
Section 7.04        Cumulative Remedies			29

 

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Section 7.05        Binding Effect			30
Section 7.06        Interpretation			30
Section 7.07        Severability			31
Section 7.08        Counterparts			31
Section 7.09        Entire Agreement			31
Section 7.10        GOVERNING LAW; JURISDICTION, ETC			31
Section 7.11        Specific Performance			33
Section 7.12        Expenses			34
Section 7.13        Amendments and Waivers; Assignment			34
Section 7.14        No Third-Party Beneficiaries			34
Section 7.15        Shareholders Agreement			35
Section 7.16        Conflict between this Agreement and the Share Rights Agreement			35
Section 7.17        Charter Documents; Further Assurances			35
Section 7.18        Electronic Transmissions			35
Section 7.19        Consent			35
Section 7.20        Confidentiality			36
Section 7.21        Suspension and Reversion of JAA Provisions			36

 

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AMENDED AND RESTATED JOINT ACTION AGREEMENT

This Amended and Restated Joint Action Agreement (this “ Agreement ”), dated as of November 29, 2018, is entered into by and among Avianca Holdings S.A., a corporation organized under the Laws of the Republic of Panama (the “ Company ”), Kingsland Holdings Limited, a company organized under the Laws of the Commonwealth of the Bahamas (“ Kingsland ”), BRW Aviation LLC, a Delaware limited liability company (“ NewCo ”), United Airlines, Inc., a corporation organized under the Laws of the State of Delaware (together with its Affiliates, “ United ”), such other Persons (as defined in Section  1.01 ) as may, from time to time, become parties to this Agreement in accordance with the provisions hereof and solely for purposes of Section  4.04 , Synergy Aerospace Corp., a corporation organized under the Laws of the Republic of Panama (“ Synergy ”). Each of United, Kingsland, NewCo and such other Persons who may hereafter become a party to this Agreement is sometimes referred to herein individually as a “ Shareholder ” and, collectively, as the “ Shareholders ”.

RECITALS:

WHEREAS , on September 11, 2013, the Company, Kingsland and Synergy entered into that certain Joint Action Agreement, as amended on March 24, 2015 (the “ Original JAA ”);

WHEREAS , on November  29 , 2018, United, NewCo, Synergy and the other parties thereto entered into that certain Term Loan Agreement (the “ NewCo Loan Agreement ”), pursuant to which United has agreed to loan to NewCo certain funds (the “ NewCo Loan ”), which NewCo Loan will be secured by, among other things, all of the Capital Stock directly owned by NewCo (such capital stock, the “ AVH Collateral ”);

WHEREAS , (i) on November 9, 2018, Synergy transferred all of its Capital Stock, and assigned all of its rights and obligations under the Original JAA to NewCo, and NewCo became a party to, and succeeded to all of the rights and obligations of Synergy under, the Original JAA, and NewCo executed and delivered an Accession Agreement pursuant to Section  6.01 of the Original JAA and (ii) on or about the date hereof, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, NewCo transferred or will transfer one Common Share to United ( clauses  (i) and (ii) , collectively, the “ NewCo and United Transfers ”);

WHEREAS , as conditions precedent to the funding of the NewCo Loan, among other things, (i) Kingsland, NewCo, the Company and United shall have entered into that certain Share Rights Agreement, dated the date hereof, (ii) Kingsland and United shall have entered into that certain Put Option Agreement (the “ Put Option Agreement ”), dated the date hereof, pursuant to which, among other things, United has agreed to grant to Kingsland the “put” rights described therein with respect to all of the Capital Stock of the Company held by Kingsland as of the date hereof (the “ Put Shares ”), (iii) Kingsland, NewCo and United shall have entered into that certain Cooperation Agreement, dated the date hereof, pursuant to which, among other things, Kingsland, NewCo and United have made certain agreements relating to the Capital Stock of the Company, (iv) NewCo and United shall have entered into that certain AVH Call Option Agreement (the “ AVH Call Option Agreement ”) and (iv) the parties hereto shall have entered into this Agreement;

WHEREAS , the parties hereto are entering into this Agreement in order to, among other things, agree to certain rights and obligations to govern the relationship among the parties, permit the transfer of, and the creation of liens on, the AVH Collateral and the Put Shares in favor of, United by excluding United, its Affiliates and the United Designee from the definition of Non-Permitted Holders; and

WHEREAS , the parties hereto now desire to amend and restate the Original JAA as set forth herein.

NOW , THEREFORE , in consideration of the foregoing and of the mutual agreements and covenants contained herein, and intending to be legally bound hereby, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS

Section 1.01     Certain Defined Terms . As used in this Agreement, the following terms shall have the following meanings:

“ 50% Payment Certification ” has the meaning set forth in Section  7.21(a) .

“ 100% JAA ” has the meaning set forth in Section  7.21(b) .

“ 100% Payment Certification ” has the meaning set forth in Section  7.21(b) .

“ Adjustment Event ” has the meaning set forth in the Put Option Agreement.

“ Affiliate ” means, with respect to any specified Person, any other Person that directly, or indirectly through one or more intermediaries, Controls, is Controlled by, or is under common Control with, such specified Person.

“ AVH ADS ” means the Company’s American Depositary Shares (as evidenced by American Depositary Receipts) listed in the NYSE, each currently representing eight Preferred Shares as of the date hereof.

“ AVH Stock Appreciation Rights Agreement ” has the meaning set forth in the Share Rights Agreement.

“ AVH United NDA ” means that certain Third Amended and Restated Confidentiality Agreement, dated as of March 2, 2017, by and between United and the Company.

“ Beneficial Owner ” or “ Beneficially Own ” (including, with correlative meaning, the term “ Beneficial Ownership ”) has the meaning given such terms in Rule 13(d)(3) under the Exchange Act.

“ Board ” means the Board of Directors of the Company.

 

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“ Business Day ” means any day other than Saturday, Sunday, a day which is a legal holiday in the City of New York, United States, Nassau, the Bahamas, Panama City, Panama, or Bogota, Colombia or a day on which commercial banks in the City of New York, United States, Nassau, the Bahamas, Panama City, Panama or Bogota, Colombia are authorized or required by Law to close.

“ Capital Stock ” means, on any given date, the issued and outstanding Common Shares and Preferred Shares as of such date.

“ Common Share ” means the Company’s common shares, par value US$0.125 per share.

“ Competitor ” means any airline based in, or whose business includes the transportation of passengers and/or cargo to, from or within any one or more of Mexico, Central America, South America and/or the Caribbean other than helicopter or private air taxi services or other non-scheduled passenger charter services using aircraft having less than 25 seats.

“ Confidential Information ” has the meaning set forth in Section  7.20 .

“ Contract ” means any legally binding arrangement, whether written or oral, including agreements, contracts, indentures, debentures, notes, bonds, loans, collective bargaining agreements, leases, mortgages, franchises, license agreements, purchase orders, bids, letters of credit, memoranda of understanding, commitments or letter of credits, in each case, including any amendments or modifications thereto.

“ Control ” means, with respect to any specified Person, the possession of the power, directly or indirectly, to direct or cause the direction of the management or policies of such Person, whether through ownership of voting securities, by Contract or otherwise, including, without limitation, the direct or indirect ownership of securities having the power, directly or indirectly, to elect or appoint the majority of the board of directors or similar body governing the affairs of such Person, and “ Controlling ” and “ Controlled by ” shall be interpreted accordingly.

“ Delegated Rights ” has the meaning set forth in the Share Rights Agreement.

“ Director ” means a Person who is a member of the Board.

“ Dividend Policy ” means the Company’s dividend policy, as adopted by the Board on March 16, 2011, that provides for the annual payment of dividends to the holders of the outstanding Capital Stock in an aggregate amount equal to a minimum of 15% of the Company’s consolidated net income for each year, subject to (a) restrictions on the payment of such dividends under applicable Law, (b) mandatory reserve requirements or similar restrictions, including on a Subsidiary’s ability to pay dividends to the Company or any other Subsidiary and (c) any restrictions set forth in any Contract binding on the Company or any of its Subsidiaries from time to time.

“ Event of Default ” has the meaning set forth in the NewCo Loan Agreement.

“ Exchange Act ” means the United States Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

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“ Exercise ” has the meaning set forth in the Put Option Agreement.

“ Family Member ” means, in the case of a natural person, the spouse of such person or a parent, sibling, or descendent of such person (or a spouse thereof) or a partnership, trust or other entity established for the benefit of any of the foregoing.

“ Governmental Authority ” means, for any country, such country and its government and any national, federal, state, provincial, territory, departmental, county, municipal, local ministry, department, political subdivision, commission, court or tribunal, or agency or instrumentality thereof (including any legislative house or judiciary), as well as any government-owned or controlled corporation or other enterprise.

“ IFRS ” means international accounting standards within the meaning of IAS Regulation 1606/2002 as set forth from time to time in the statements and pronouncements of the International Accounting Standards Board, which are applicable to the circumstances as of the date of determination.

“ Independent Third Party ” has the meaning set forth in the Share Rights Agreement.

“ Joint Business Agreements ” has the meaning set forth in the NewCo Loan Agreement.

“ Key Person ” has the meaning set forth in the NewCo Loan Agreement.

“ Key Person Event ” has the meaning set forth in the NewCo Loan Agreement.

“ Kingsland Director Rights ” means Kingsland’s rights and obligations set forth in Section  3.03 , Section  3.04 , Section  3.05 and Section  3.06 (and consent or waiver rights with respect to any amendments or modifications to such sections of the JAA to the extent that such amendments or modifications are material or adverse to Kingsland or would expand Kingsland’s obligations or limit Kingsland’s rights under the JAA).

“ Kingsland Group ” means Kingsland and its Permitted Transferees.

“ Kingsland NDA ” means that certain Non-Disclosure Agreement, dated as of August 11, 2017, by and between United and Kingsland.

“ Kingsland Termination Event ” has the meaning set forth in Section  3.09 .

“ Law ” or “ Laws ” means all applicable statutes, laws, rules, regulations, codes, ordinances, rulings, orders, decisions and awards of Governmental Authorities or permits.

“ Lien ” means any mortgage, pledge ( prenda mercantil ), hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, or preference, priority or other security interest or preferential arrangement in the nature of a security interest of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any easement, right of way or other encumbrance on title to real property, and any financing lease having substantially the same economic effect as any of the foregoing).

 

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“ Majority Vote ” means a majority of the Directors present (by telephone conference, videoconference or similar telecommunications device, proxy or otherwise) at a meeting of the Board at which there is a quorum.

“ Material Subsidiaries ” means, collectively: (a) the following Subsidiaries of the Company: Taca International Airlines, S.A.; Avianca Costa Rica S.A.; Aviateca, S.A.; Avianca Perú S.A.; Isleña de Inversiones, S.A. de C.V.; Aerotaxis La Costeña, S.A.; Servicios Aereos Nacionales, S.A.; Aerovías del Continente Americano S.A. Avianca; Avianca Ecuador S.A.; and Tampa Cargo S.A.S.; and (b) any operating Subsidiaries of the Company which are, or from time to time are, “significant subsidiaries” as defined by Rule 405 under the United States Securities Act of 1933, as amended.

“ NewCo Group ” means NewCo and its Permitted Transferees.

“Non-Material Subsidiary” means any Subsidiary of the Company the revenues, assets or liabilities of which are less than 0.15% of the aggregate consolidated gross revenues, assets or liabilities, as applicable, of the Company for the most recent fiscal year.

“ Non-Permitted Holder ” means (a) a Person whose ownership of securities of the Company would violate applicable Law or would cause the Company or any of its Subsidiaries to no longer comply with local ownership restrictions or aviation bilateral treaties that govern the Company’s or its Subsidiaries’ operations, (b) any Competitor or an Affiliate of a Competitor, (c) any Person whose business includes the transportation of passengers and/or cargo that is not a member of the Star Alliance or (d) with respect to clauses (b) and (c), to any Transferring Shareholder’s actual knowledge, any Person acting on behalf of a Competitor (or an Affiliate of such Competitor) or such Person that is not a member of the Star Alliance; provided, however , that none of the parties to this Agreement, any Affiliate of United, the Independent Third Party, or following an Event of Default, a United Designee, shall be deemed or considered to be a Non-Permitted Holder.

“ NYSE ” means the (a) the New York Stock Exchange or (b) if the AVH ADSes are no longer quoted on the New York Stock Exchange, the principal U.S. stock exchange or securities market on which the AVH ADSes are then listed or quoted.

“ Obligations ” has the meaning set forth in the NewCo Loan Agreement.

“ Organization Documents ” means, with respect to any Person, its core documents, including (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction, including the pacto social ); (b) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction, including pacto social and estatutos under applicable Panamanian Law); and (c) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation, registration or organization of such entity.

“ party ” and “ parties ” means, collectively, the parties to this Agreement from time to time, and, each, individually, a “ party ”.

 

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“ Permitted Transferee ” means, with respect to any Person, (a) any Affiliate of such Person, (b) in the case of a Person which is a natural person, a Family Member of such Person, and (c) a transferee of Shares who receives such Shares by will or the Laws of descent and distribution, provided, however , that, notwithstanding the foregoing, a Non-Permitted Holder may not be deemed a Permitted Transferee.

“ Person ” means any natural person, partnership, firm, corporation, association, trust, unincorporated organization or other entity, as well as any syndicate or group that would be deemed to be a person under Section 13(d)(3) of the Exchange Act.

“ Preferred Shares ” means the Company’s preferred shares, par value US$0.125 per share.

“ Primary JBA ” has the meaning set forth in the NewCo Loan Agreement.

“ Put Option ” has the meaning set forth in the Put Option Agreement.

“ Sale ” means, in respect of any securities, property or other asset, any direct or indirect sale, assignment, Transfer, distribution or other disposition thereof or of a participation therein, or other conveyance of any legal, ownership or beneficial interest therein (including through the sale or other Transfer of securities of any Person that is an owner of or Controls any Person that is an owner of such securities), or any short position in a security, or any other action or position otherwise reducing risk related to ownership through hedging or other derivative instruments, whether voluntarily or involuntarily or by operation of law or any agreement or commitment to do any of the foregoing.

“ Senior Management ” means the Company’s Chief Executive Officer, Chief Operating Officer and Chief Financial Officer.

“ Share Rights Agreement ” means that certain Share Rights Agreement, dated as of the date hereof, by and among Kingsland, NewCo, the Company and United.

“ Shareholder ” has the meaning set forth in the recitals.

“ Shareholder Group ” means the Kingsland Group, the NewCo Group or the United Group, as the context may require.

“ Shares ” means, on any given date, the issued and outstanding Common Shares and Preferred Shares as of such date.

“ Special Approval Matter ” means a matter for which either or both of the Independent Third Party (or United, if United delivers a United Approval Notice with respect to such matter) and NewCo have approval rights pursuant to Section  3.07(a) .

“ Subsidiary ” means, with respect to a Person, any other Person Controlled by such first Person.

 

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“Supermajority Affirmative Vote” means, at any time of determination, the affirmative vote of not fewer than the sum of (x) the largest number of Directors that have been appointed or elected by any of the Shareholder Groups at such time of determination, plus (y) one Director.

“ Synergy ” has the meaning set forth in the recitals.

“ Synergy Change in Control ” means any transaction or series of related transactions involving (a) the Sale of all or substantially all of the airline related assets of Synergy, NewCo and NewCo’s Subsidiaries, or (b) a Sale of equity securities (by merger or otherwise) of Synergy or any other Person, or other transaction, following which German Efromovich and/or Jose Efromovich and/or any one or more of the Family Members and/or Affiliates thereof do not, immediately after such Sale or other transaction, own equity securities representing a majority of the voting power of Synergy (or the surviving entity of any merger involving Synergy) and the ability to elect a majority of the directors of Synergy (or the surviving entity of any such merger), in the case of each of clauses  (a) and (b) , excluding, for purposes of this Agreement, (i) a Sale to United, its Affiliates or a United Designee, (ii) any Transfer of Shares or rights relating thereto to the Independent Third Party, (iii) the creation of any Lien on any Shares in favor of the Collateral Agent (as defined in the NewCo Loan Agreement), or (iv) any foreclosure by or on behalf of the Collateral Agent.

“ Synergy United AVH NDA ” means that certain Confidentiality Agreement, dated as of October 24, 2018, by and between Synergy, United and the Company.

“ Third Party ” means, with respect to any Shareholder, any other Person (other than a Permitted Transferee or an Affiliate, officer, director or employee of such Shareholder).

“ Transaction Documents ” has the meaning set forth in the Share Rights Agreement.

“ Transfer ,” “ Transferred ,” “ Transferring ” means, with respect to a Person, a direct or indirect disposition, sale, assignment, transfer, gift, surrender for cancellation, exchange or pledge, or the direct or indirect grant or transfer of any economic interest, security interest, ownership, derivative interest, voting power or other Lien, including by death (except with respect to a Key Person Event), operation of law, judicial decree, a change of Control of such Person, merger or consolidation of such Person into or with any other Person or otherwise, and the term “ Transferability ” shall be interpreted accordingly; provided, however , that a change of Control or merger or consolidation of United shall not be deemed a Transfer for purposes of this Agreement.

“ United Approval Notice ” has the meaning set forth in the Share Rights Agreement.

“ United Designee ” means any of the following Persons designated in writing by United, which Person will exercise any rights of United under this Agreement and any Transaction Document designated by United to be exercised by the United Designee: (a) any Affiliate of United; (b) any transferee of all or portion of the Common Shares owned or controlled by United; (c) any Person not party to, or an Affiliate of a party to, this Agreement (except as set forth in clause (d) ); and (d) Kingsland, so long as it consents in writing to serve as the United Designee; provided , however , that, in the case of subclause  (d) , (x) if United has determined, in its sole and absolute discretion, that it can deliver a United Approval Notice but chooses not to do so (and only

 

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for so long as United does not change such determination) or if United has delivered a United Approval Notice, the United Designee cannot be, or remain to be, Kingsland with respect to the rights and matters set forth in the United Approval Notice and (y) for purposes of the exercise of any of United’s rights under this Agreement, such Person shall not be a Non-Permitted Holder; provided further , however , that (x) for so long as an Event of Default has occurred and is occurring, (y) if NewCo or any Affiliate of NewCo has breached its material obligations under any Transaction Document to which it is a party or (z) United is exercising its rights under Section  2.3 , Section  2.7 or Section  2.8 of the Share Rights Agreement, a United Designee may be a Non-Permitted Holder.

“ United Group ” means United and its Permitted Transferees (including any United Designee, but, for purposes of this definition, excluding NewCo and Kingsland).

Section 1.02     Other Defined Terms . The following capitalized terms, when used in this Agreement without definition, shall have the meanings set forth in the Sections of this Agreement indicated below:

 

Defined Term		Section Reference
Accession Agreement		Section 6.01(a)
Additional Director		Section 3.03(e)
Agreement		Preamble
Appraiser		Section 4.04(c)(ii)
Approval Request		Section 3.07
AVH Call Option Agreement		Recitals
AVH Collateral		Recitals
Board Supermajority Matter		Section 3.04(a)
Business Plan and Budget		Section 5.01
CEO		Section 3.08(a)
CFO		Section 3.08(b)
Company		Preamble
Consensus Directors		Section 3.03(a)(i)(C)
Disapproval Notice		Section 3.07(c)
Executive Committee		Section 3.03(f)
Fair Value of the Company		Section 4.04(b)(ii)
Final Appraiser		Section 4.04(c)(ii)
HR Committee		Section 3.08(b)
Incumbent CEO		Section 3.08(a)
Independent Director		Section 3.03(a)(i)
Initial Appraisers		Section 4.04(c)(i)
Initial Valuation Date		Section 4.04(c)(ii)
ITP Board Observer		Section 3.03(d)
Kingsland		Preamble
Kingsland Election Date		Section 4.04(a)
Mutual Appraiser		Section 4.04(c)(i)
NewCo		Preamble
NewCo and United Transfers		Recitals
NewCo Loan		Recitals

 

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NewCo Loan Agreement		Recitals
Notices		Section 7.02
Optioned AVH Shares		Section 4.02(d)
Original JAA		Recitals
Put Option Agreement		Recitals
Put Shares		Recitals
Representatives		Section 7.20
Shareholder		Preamble
Successor Designation		Section 3.08(a)
Synergy Buyer		Section 4.04(a)
Synergy Change in Control Transaction		Section 4.04(a)
Tag-Along Price		Section 4.04(b)(i)
Tag-Along Shares		Section 4.04(a)
United		Preamble
United Board Observer		Section 3.03(d)

ARTICLE II

REPRESENTATIONS AND WARRANTIES

OF THE STOCKHOLDERS

Each Shareholder severally, but not jointly, represents and warrants to the Company and each other Shareholder as follows:

Section 2.01     Organization and Authority . It is duly incorporated or organized, validly existing and in good standing under the Laws of the jurisdiction of its incorporation or organization and has all necessary power and authority to enter into this Agreement, to carry out its obligations hereunder and to perform the actions contemplated hereby. The execution and delivery of this Agreement by such Shareholder, the performance by it of its obligations hereunder and the performance by it of the actions contemplated hereby have been duly authorized by all requisite action on its part. This Agreement has been duly executed and delivered by such Shareholder, and (assuming due authorization, execution and delivery by the other Persons signatory hereto) this Agreement constitutes a legal, valid and binding obligation of such Shareholder enforceable against it in accordance with its terms.

Section 2.02     No Conflict . The execution, delivery and performance of this Agreement by such Shareholder does not and will not (a) violate, conflict with or result in the breach of any provision of its Organization Documents, to the extent it has such, (b) conflict with or violate any Law applicable to such Shareholder or any of its assets, properties or businesses or (c) conflict with, result in any breach of, constitute a default (or event which with the giving of notice or lapse of time, or both, would become a default) under, require any consent under, or give to others any rights pursuant to, any contract, agreement or arrangement by which such Shareholder is bound.

 

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ARTICLE III

GOVERNANCE

Section 3.01     General .

(a)    From and after the date hereof, each Shareholder shall take all actions necessary to (i) give effect to the provisions of this Agreement, (ii) ensure that the Organization Documents of the Company and any of its Subsidiaries (x) give effect to the provisions of this Agreement and (y) do not conflict with the provisions of this Agreement, including voting to approve amendments to the Organization Documents of the Company and any of its Subsidiaries, and (iii) remove any Directors of the Company or directors of any of its Subsidiaries or any officer of the Company or officers of any of its Subsidiaries who take or attempt to take actions, or refrain from taking actions, in each case in violation of this Agreement. In addition, each Shareholder shall vote or cause to be voted all Capital Stock owned by such Shareholder at any shareholders meeting or in any written consent executed in lieu of such a meeting with respect to the Common Shares or the Preferred Shares, as the case may be, upon any matter submitted for action by the Company’s shareholders, in conformity with the specific terms and provisions of this Agreement and the Organization Documents of the Company or of its Subsidiaries. Subject to Section  7.16 and Section  7.17 , to the extent permitted by applicable Law, in the event that there is any conflict between the Organization Documents of the Company or of any of its Subsidiaries and this Agreement, this Agreement shall prevail and the Shareholders and the Company shall, to the extent necessary, cause the Organization Documents of the Company or of its Subsidiaries to be changed, amended or modified to eliminate any such inconsistency (such change, amendment or modification, if any, to occur as soon as reasonably practicable but in any event on or before March 31, 2019 with respect to its Material Subsidiaries, and on or before June 30, 2019 with respect to its other Subsidiaries).

(b)    Notwithstanding anything in this Agreement to the contrary, from the date hereof until the delivery by United, if ever, of a United Approval Notice with respect to the applicable right, (i) a United Designee shall exercise all rights of any member of the United Group under this Agreement and (ii) the Independent Third Party shall exercise all of the Delegated Rights in accordance with Article 3 of the Share Rights Agreement. At such time, if ever, as United delivers a United Approval Notice with respect to any or all of such Delegated Rights, United (or, if designated by United, the United Designee) shall automatically succeed to each of such rights and authority identified in such United Approval Notice, supplanting the rights and authority of the Independent Third Party (or Kingsland or any other temporary Independent Third Party) or the United Designee, as applicable, with respect to such identified rights and authority, without any further amendment of this Agreement or the Share Rights Agreement.

(c)    From and after the date hereof, the Company shall not, and shall cause its Subsidiaries not to, take or commit to take any action that is not permitted by this Agreement, and the Company agrees to take all necessary and appropriate measures within its power in order to ensure the compliance by the Company and any of its Subsidiaries with any covenant or other obligation hereunder.

Section 3.02     Agreement to Vote . Each Shareholder agrees to vote all of its Capital Stock in order to carry out the agreements set forth in this Article III .

 

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Section 3.03     Size and Composition of Board .

(a)    Except as set forth in Section  3.03(c) , the composition of the Board shall be determined as follows:

(i)    A majority of the Directors serving on the Board at any time shall consist of individuals who qualify as “independent” under the rules and regulations of the NYSE (each, an “ Independent Director ”).

(A)    Each of the Kingsland Group and the United Group shall be entitled to appoint a number of such Independent Directors proportional to its ownership of Common Shares in relation to the other Shareholder Groups, equal to the product (rounded up or down to the nearest whole number) of: (1) the total number of Independent Directors, multiplied by (2) a fraction, the numerator of which is the aggregate number of Common Shares owned by such Shareholder Group and the denominator of which is the total number of Common Shares then owned by the NewCo Group, the Kingsland Group and the United Group.

(B)    The NewCo Group shall be entitled to appoint a number of such Independent Directors that is two less than the number proportional to its ownership of Common Shares in relation to the other Shareholder Groups, equal to (x) the product (rounded up or down to the nearest whole number) of: (1) the total number of Independent Directors, multiplied by (2) a fraction, the numerator of which is the aggregate number of Common Shares owned by the NewCo Group and the denominator of which is the total number of Common Shares then owned by the NewCo Group, the Kingsland Group and the United Group, minus (y) two (2).

(C)    Two additional Independent Directors (the “ Consensus Directors ”) shall be appointed by agreement of NewCo and Kingsland or, if Kingsland is unable or unwilling to engage with NewCo to appoint such Consensus Directors for a period of 15 consecutive days following any Consensus Director vacancy or a Kingsland Termination Event shall have occurred, then, the Independent Third Party will propose a list of three persons to be appointed as Consensus Directors ( provided that the Independent Third Party shall use reasonable efforts to include up to four persons on the list), and NewCo shall, within two Business Days, select in writing two of such Persons to serve as Consensus Directors, in each case, such persons to have demonstrated experience in airline management, finance and/or governance; provided, however , that, if for any reason, Kingsland is engaging with NewCo, but NewCo and Kingsland cannot agree on the appointment of a Consensus Director during the 15-day period following any Consensus Director vacancy, then such Consensus Director shall be appointed directly by the Independent Third Party (or (x) if the Independent Third Party is Kingsland, then by a United Designee that is not an Affiliate of United or (y) United, if it has succeeded to this right of the Independent Third Party pursuant to the Share Rights Agreement).

 

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(ii)    Of the total number of Directors who are not Independent Directors, each Shareholder Group shall be entitled , at its sole option, to appoint a number of such Directors proportional to its ownership of Common Shares in relation to the other Shareholder Groups, equal to the product (rounded up or down to the nearest whole number) of: (A) the total number of Directors who are not Independent Directors and (B) a fraction, the numerator of which is the aggregate number of Common Shares owned by such Shareholder Group and the denominator of which is the total number of Common Shares then owned by the NewCo Group, the Kingsland Group and the United Group.

(iii)    Notwithstanding anything in Section  3.03(a)(i) or Section  3.03(a)(ii) to the contrary, the minimum threshold of ownership applicable to the first Director to be appointed by the United Group will be 5% of the then outstanding Common Shares. In the event the United Group’s ownership of Common Shares is 5% or more, but is less than the pro  rata ownership of Common Shares required to appoint one Director to the Board, then, the positive difference between the United Group’s ownership of Common Shares and the pro  rata ownership of Common Shares required to appoint one Director shall be proportionally reduced from the Kingsland Group’s and the NewCo Group’s respective ownership of Common Shares for purposes of the calculation hereof, in order for the United Group to be able to appoint such single Director pursuant to this Section  3.03(a)(iii) . For the avoidance of doubt, in the event that the United Group’s ownership of Common Shares is at least 5% of the then outstanding Common Shares and equal to, or higher than, the pro  rata ownership of Common Shares required to appoint one Director of the Board, then, the procedure set forth herein shall not be applied for purposes of calculating the number of Directors each Shareholder Group will have the right to appoint pursuant to Section  3.03(a)(i) .

(b)    The Board shall have a non-executive chairman to be elected by Majority Vote.

(c)    Notwithstanding anything in this Section  3.03 to the contrary, the rights of the United Group set forth in Section  3.03(a)(i) or Section  3.03(a)(ii) shall be exercised by a United Designee until such time, if ever, that United has delivered a United Approval Notice that it is entitled to and intends to exercise its rights set forth in Section  3.03(a)(i) and Section 3.03(a)(ii). For so long as the United Group owns at least 5% of the then outstanding Common Shares, the United Group shall be entitled, at its sole option, to appoint a number of Directors equal to the greater of (i) one (who shall not be an Independent Director) and (ii) the product (rounded up or down to the nearest whole number) of: (A) the total number of Directors who are not Independent Directors and (B) a fraction, the numerator of which is the aggregate number of Common Shares owned by the United Group and the denominator of which is the total number of Common Shares then owned by the NewCo Group, the Kingsland Group and the United Group; it being understood that, in the event that a certain Shareholder or Shareholder Group has been granted the rights, title and interest, or beneficial, voting and distribution rights, including ownership rights and usufruct rights, with respect to Common Shares issued in the name of another Shareholder, the Shareholder or Shareholder Group who has been granted the aforementioned rights shall be deemed the owner of such Common Shares, and the Shareholder or Shareholder Group who has granted such aforementioned rights will no longer be deemed the owner of such Common Shares, for purposes of the foregoing pro  rata calculation. The NewCo Group and the Kingsland Group shall call a special meeting of the shareholders of the Company and participate in such special meeting (such

 

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meeting to occur at the earliest time permitted by the Company’s Organization Documents) and vote their Common Shares in favor of the election of the Directors nominated by United, in accordance with this Section  3.03(c) , and the size of the Board shall be increased or otherwise adjusted to accommodate such Directors nominated by the United Group, as applicable.

(d)    During the term of this Agreement, unless and until United (i) shall have delivered the United Approval Notice referenced in the first sentence of Section  3.03(c) or (ii) has appointed one Director pursuant to Section  3.03(a) , (x) United (or, if designated by United, a United Designee) shall be entitled to designate one representative and one alternate representative to act in his/her absence chosen by the United Group in its sole discretion (the “ United Board Observer ”) to attend, and such United Board Observer shall be invited by the Company to attend, strictly as an observer, all meetings of the boards of directors of the Company and its Subsidiaries as well as any and all committees thereof and (y) the Independent Third Party shall have the right to attend, and such Independent Third Party shall be invited by the Company to attend, strictly as an observer, all meetings of the boards of directors of the Company and its Subsidiaries as well as any and all committees thereof (the “ ITP Board Observer ” and together with the United Board Observer, the “ Board Observers ”).

(i)    The United Group may from time to time in its sole discretion designate and replace any such United Board Observer by written notice to the Company with at least two Business Days’ advance notice.

(ii)    The Board Observers shall either (i) agree in writing (such writing to be submitted to the Company and the United Group) to abide by the provisions of Section  7.20 or (ii) execute a non-disclosure agreement with the Company containing confidentiality provisions no less restrictive than the provisions set forth in Section  7.20 , in each case, after which such Board Observer shall be entitled to receive, concurrently with, and in the same manner as provided to the Directors, all notices and written materials provided to the Directors, including, but not limited to, Board and committee meeting agendas, presentations and analyses. A Board Observer will not be entitled to any voting rights.

(e)    If a majority of the Independent Directors determine that (i) it is in the best interests of the Company to appoint to the Board, in addition to the Consensus Directors and the Directors appointed by the NewCo Group, the Kingsland Group and the United Group, as applicable, pursuant to clauses  (i) , (ii) and (iii)  of Section  3.03(a) , an individual to represent the interests of a significant holder or group of related holders of Capital Stock (other than the NewCo Group, the Kingsland Group and the United Group, as applicable), or (ii) the Company is required by Law to appoint to the Board, in addition to the Directors appointed by the NewCo Group, the Kingsland Group and the United Group, as applicable, pursuant to clauses  (i) , (ii) and (iii)  of Section  3.03(a) any other individual; then, for so long as the majority of the Independent Directors determines that the Company should or must appoint such an individual (an individual to be appointed pursuant to this Section  3.03(e) is referred to herein as an “ Additional Director ”), (A) the size of the Board shall be increased to accommodate such Additional Director, (B) the additional Board seat(s) created by the increase in the size of the Board shall be filled only by Additional Director(s), (C) all Directors other than any Additional Directors shall continue to be nominated and appointed pursuant to clauses  (i) , (ii) and (iii)  of Section  3.03(a) and (D) any Additional Director shall qualify as an Independent Director.

 

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(f)    The Board shall establish a committee of the Board (the “ Executive Committee ”), to consist of one Independent Director appointed by NewCo, one Independent Director appointed by Kingsland (provided that after a Kingsland Termination Event, such seat will be filled by one Independent Director appointed by the United Group) and one of the Consensus Directors selected by the other two members of the Executive Committee, in each case, for so long as such Shareholder is entitled to appoint Independent Directors. The Consensus Director that is not selected to be a member of the Executive Committee shall serve as an alternate member of the Executive Committee, eligible to attend Executive Committee meetings and to vote in the place of the other Consensus Director if such other Consensus Director is not present at such meeting for such vote. Subject to Section  3.04(a) and Section  7.21 , the Executive Committee shall review all matters to be presented to the Board, and the approval of a majority of the members of the Executive Committee shall be required for any agenda item or matter requiring a decision or resolution of the Board, prior to its presentation to the Board.

(g)    The compensation to be paid to the members and alternate member of the Executive Committee is set forth in Schedule  III .

Section 3.04     Board Meetings .

(a)    The Board shall meet no less frequently than quarterly or other frequency as determined by the Board in its sole discretion, at such place and time as shall be determined by Majority Vote. Special meetings of the Board, to be held at the offices of the Company or such other place as shall be agreed by Majority Vote, shall be called at the direction of the CEO or one or more Directors, and for reasonable cause shown (which includes any meeting called by a Director to review any determination made by the Company pursuant to this Agreement), upon not less than five (5) Business Days’ notice given by one or more Directors, the CEO, the chairman of the Board or the Secretary of the Company to each Director (which foregoing officers shall give such notice if properly directed to do so by one or more Directors or the chairman of the Board as aforesaid). Emergency meetings of the Board may be held at the offices of the Company or such other place as shall be agreed by Majority Vote upon not less than one (1) Business Day’s telephone notice to each Director specifying in reasonable detail the nature of such emergency (to be confirmed by written notice to each Director including an agenda specifying in reasonable detail the matters to be discussed at the applicable Board meeting) by any Director, the CEO, the chairman of the Board or the Secretary of the Company. The matters addressed and resolved at any meeting may only include those expressly mentioned in the call notice and included in the agenda, unless otherwise agreed by a majority of the Directors present at such meeting and by a majority of Directors who are members of the Executive Committee (which agreement may be obtained at the relevant meeting); provided, however , that, if the majority of Directors who are members of the Executive Committee do not agree to include in the agenda a certain matter that is not a Special Approval Matter, and such matter, if not addressed and resolved at a Board meeting would cause, upon the written advice of the general counsel or outside legal counsel, the Directors to breach their fiduciary duties to the Company (each, a “ Board Supermajority Matter ”), then the Board may consider such matter if a majority of Directors agree to do so and may act upon such Board Supermajority Matter upon a receipt of a Supermajority Affirmative Vote. Notwithstanding anything to the contrary, subject to Section 7.20 , each Director may discuss any matters discussed at a Board meeting, and share information provided at a Board meeting or in connection therewith (including any written materials), with the Shareholder Group that appointed such Director.

 

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(b)    With respect to regular Board meetings, not later than five (5) Business Days before each such meeting, the Secretary of the Company shall deliver to each Director, together with the notice of each such meeting, an agenda specifying in reasonable detail the matters to be discussed at the applicable Board meeting (which matters, subject to Section  7.21 , shall have been approved in advance by the Executive Committee). Any Director who wishes to have any additional matter discussed at any such meeting shall give the Secretary of the Company and each other Director not later than two Business Days prior to any such meeting, notice of each matter he or she so wishes to discuss. The provisions of this Section  3.04(b) shall remain subject to Section  3.03(f) with regard to any agenda item or matter requiring a decision or resolution of the Board.

(c)    Any Person who is entitled to attend any Board meeting may participate in that meeting by proxy, telephone conference, videoconference or similar telecommunications device by means of which all Persons participating in the meeting can hear each other or by any other method agreed to by the Board (which agreement may be obtained at the relevant meeting) and that Person will be counted towards the quorum of the meeting if he or she so participates; provided, however , that if a Director participates in a meeting via proxy, such Director may do so by granting such proxy to any other Director or the Secretary of the Company.

Section 3.05     Nomination and Election of Directors . The Shareholder Groups shall make the nominations to which they are entitled hereunder not later than thirty (30) days prior to each annual meeting of the Company’s shareholders, and the Board shall be elected at such meeting or by unanimous written consent in accordance herewith. Except as set forth in Section  3.06(b) , all of the Independent Directors shall be elected, together on a single unified slate, at each annual meeting of the shareholders. The Company’s shareholders, agree to vote their Common Shares at any regular or special meeting of shareholders or in any written consent executed in lieu of such a meeting, and shall take all other actions necessary to appoint each Independent Director or Director that is not an Independent Director selected by each Shareholder Group pursuant to this Article  III .

Section 3.06     Removal of Directors: Vacancies .

(a)    A Shareholder Group may, at any time, remove any Director designated or nominated by such Shareholder Group pursuant to Section  3.03 and Section  3.05 , with or without cause by providing notice to the other Shareholder Groups and the Company. In the event that, at any time after the effectiveness of this Agreement, the number of Directors designated by a Shareholder Group differs from the number that such Shareholder Group has the right to designate, (i) if the number of such Directors exceeds the appropriate number, the Shareholder Group shall promptly take all appropriate action to cause to resign that number of Directors as is required to make the remaining number of Directors designated by such Shareholder Group conform to the provisions of this Agreement or (ii) if the number of such Directors is less than the appropriate number, the Board and the other Shareholder Groups shall take all necessary action to create sufficient vacancies on the Board to permit such Shareholder Group to designate the full number of Directors which it is entitled to designate pursuant to the provisions of this Agreement.

 

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(b)    In the event a vacancy occurs on the Board as a result of the retirement, removal, resignation or death of any Director other than a Consensus Director, the Shareholder Group that initially appointed such Director shall appoint, at its sole discretion, a new person to replace such Director. In the case of the retirement, removal, resignation or death of any Consensus Director, such vacancy shall be filled by agreement of the NewCo Group and the Kingsland Group, or the NewCo Group and the Independent Third Party or United, in each case, as provided in Section  3.03(a)(i) . The Shareholders agree to vote their respective Common Shares for the election of any person designated in accordance with this Section  3.06(b) to fill a vacancy on the Board. Any Director elected pursuant to this Section  3.06(b) shall serve until the next annual election of Directors.

Section 3.07     Approval Required .

(a)    A Majority Vote shall constitute an act of the Board. Notwithstanding the foregoing, but subject to Section  3.3 of the Share Rights Agreement, neither the Company nor any Subsidiary shall take any of the following actions without the approval of each of the Independent Third Party (or United, if United has delivered a United Approval Notice with respect to the rights under this Section  3.07(a) ) and NewCo:

(i)    other than with respect to any Non-Material Subsidiary, modify, waive or repeal any provision contained in its Organization Documents, unless such modification is required, in the written opinion of the Company’s outside legal counsel, in accordance with applicable Laws to comply with an order by a Governmental Authority;

(ii)    merge or consolidate the Company or any Subsidiary with, or sell, Transfer or otherwise dispose of, all or substantially all of the assets of the Company or any Subsidiary, to any Third Party;

(iii)    issue or sell any voting Capital Stock of or other form of voting equity interest (or other security exercisable for or convertible into any voting Capital Stock or other form of voting equity interest) in the Company or any Subsidiary;

(iv)    except as specifically identified in the Business Plan and Budget, make any acquisition of (A) securities or other interests in any joint venture, partnership or other Person, (B) other assets related to the airline business or activities ancillary or related thereto in each case in an amount greater than (1) US$10.0 million in any single instance or (2) US$25.0 million in the aggregate during any fiscal year, or (C) other assets not related to the airline business or activities ancillary or related thereto;

(v)    except as specifically identified in the Business Plan and Budget, make capital expenditures in excess of US$10.0 million in the aggregate during any fiscal year;

(vi)    authorize, adopt, amend or modify the Business Plan and Budget;

(vii)    enter into, modify or supplement any Contract (A) with a Shareholder, Director or an officer of the Company or a Family Member or Affiliate of any of the foregoing, whether for the performance of services or the direct or indirect sale, lease, conveyance, exchange, Transfer or other disposition of goods, property or other assets or the leasing of same or otherwise or (B) pursuant to which a Shareholder, Director or an officer of the Company or a Family Member or Affiliate of any of the foregoing is a direct or indirect third-party beneficiary;

 

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(viii)    loan any funds, enter into any advance purchase arrangement or otherwise extend credit to (A) a Shareholder, Director or an officer of the Company or a Family Member or an Affiliate of the foregoing or (B) any other Person other than to Airlines Clearing House Inc. or any vendor (including any travel agent or travel agency) in the ordinary course of business and on industry standard commercial terms;

(ix)    except as specifically identified in the Business Plan and Budget, enter into any Contract (including the giving of any guaranty or indemnity) that is either (A) outside the ordinary course of business, (B) on terms other than industry standard commercial terms, (C) of any long-term nature, or (D) involving an aggregate annual payment greater than 0.15% of consolidated gross revenues of the Company for the most recent four consecutive fiscal quarters;

(x)    terminate any Joint Business Agreement, except (A) as a result of a breach or default thereunder by United or any of its Affiliates giving rise to the Company’s right to such termination, (B) when such termination is required, in the written opinion of the Company’s outside legal counsel, in accordance with applicable Laws to comply with an order by a Governmental Authority and such order cannot be appealed by the parties to such Joint Business Agreement or complied with by the parties to such Joint Business Agreement using reasonable commercial efforts in a manner that does not require termination of such Joint Business Agreement, as applicable, (C) in accordance with its terms, effective no earlier than the expiration of the Initial Term (as defined in the Primary JBA), or (D) when such termination is made jointly by United and the Company;

(xi)    any action or omission which would cause the Company to breach, or would constitute a default under, a Joint Business Agreement;

(xii)    commence any bankruptcy or insolvency proceeding;

(xiii)    other than with respect to any Non-Material Subsidiary, dissolve or liquidate, or agree to dissolve or liquidate;

(xiv)    enter into, amend or modify any Contract for the purchase, order, lease (including any wet lease or dry lease), sublease or financing of any aircraft or aircraft engine (in each case whether new or used), or any other Contract which, would result in new or used aircraft or aircraft engines being added to Company’s fleet, unless, with respect to an amendment or modification of any such existing Contract, such amendment or modification (i) does not result in the imposition or expansion of any obligation of or restriction or burden on the Company or any Subsidiary thereof or reduction of the rights of the Company or any Subsidiary under such Contract and (ii) is consistent with the then prevailing market rates and industry practice with respect to Contracts for the purchase, order, lease (including any wet lease or dry lease), sublease or financing of any aircraft or aircraft engine (in each case whether new or used) of the same type;

 

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(xv)    modify, waive or repeal any provision contained in any contractual arrangement with LifeMiles Ltd. or any of its Subsidiaries or other Affiliate owning any portion of the LifeMiles business;

(xvi)    change the jurisdiction of organization of the Company;

(xvii)    increase or decrease the size of the Board (other than an increase approved by a majority of the Independent Directors pursuant to Section  3.03(e) ); or

(xviii)    subject to Section  7.21 , submit any matter for a vote of the shareholders of the Company at a shareholders’ meeting (or otherwise).

(b)    Neither the Company nor any Subsidiary shall take any of the following actions without both a Majority Vote and the approval of a majority of the Independent Directors:

(i)    (A) acquire, repurchase or redeem any Capital Stock or other equity interest (or other security exercisable for or convertible into any Capital Stock or other equity interest) in the Company or any Subsidiary or (B) issue or sell any non-voting Capital Stock of or other non-voting equity interest (or other form of security exercisable for or convertible into any non-voting Capital Stock or other form of non-voting equity interest) in the Company or any Subsidiary;

(ii)    unless required by Law or a change in IFRS make any material change in accounting methods (other than (x) a change permitted by IFRS and recommended in writing by the Company’s external auditors or (y) a change recommended by management and unanimously approved by the audit committee of the Board);

(iii)    execute a settlement agreement or confess a judgment, the result of which would be to cause the Company to pay over US$5.0 million to a Third Party;

(iv)    commence any litigation for an amount in excess of US$5.0 million;

(v)    except as contemplated by the Business Plan and Budget, incur indebtedness for borrowed money (other than working capital debt incurred in the ordinary course of business), involving an aggregate annual amount greater than ten percent (10%) of the amount budgeted therefor in the Business Plan and Budget;

(vi)    adopt or amend any stock option plan or other equity incentive plan, or implement any methodology or structure (including compensation ranges) for determining the compensation of the Senior Management and the vice presidents of the Company;

(vii)    select or replace its independent auditors;

(viii)    modify the Dividend Policy; or

(ix)    terminate or relinquish any material governmental license, permit or concession obtained or held by the Company or any of its Material Subsidiaries.

 

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(c)    Prior to the Board’s considering or acting upon any Special Approval Matter at any Board meeting, and/or prior to the Company or the Board submitting any Special Approval Matter to a vote of the Company’s shareholders, as applicable, the Company shall send to each of the Independent Third Party (or United, if United has delivered a United Approval Notice with respect to the rights under this Section  3.07(a) ) and NewCo a written notice requesting that each of them approves a Special Approval Matter (an “ Approval Request ”) (A) with respect to any Board meeting at which a Special Approval Matter is to be considered, at least fifteen (15) days before the date such Board meeting is scheduled to occur, or (B) with respect to any shareholders meeting at which a Special Approval Matter is to be considered, at least fifteen (15) days before the earlier of the date of such shareholders meeting and the date on which the notice of such shareholders meeting is sent to the Company’s shareholders. Any Approval Request shall be accompanied by any materials that will be presented to the Board or shareholders in respect of the subject Special Approval Matter(s), which materials shall describe the Special Approval Matter(s) in all material respects and include all such information required to permit a Director or Shareholder to be fully informed on such matter and, in the case of a Director, exercise his or her fiduciary duties in connection with voting on such matter. Unless the Independent Third Party (or United, if United has delivered a United Approval Notice with respect to the rights under this Section  3.07(a) ) or NewCo, as applicable, delivers to the Company and each other Shareholder within fifteen (15) days following receipt of an Approval Request or two Business Days following the applicable Board meeting or shareholders meeting, as the case may be, a written notice that the Independent Third Party (or United, if United has delivered a United Approval Notice with respect to the rights under this Section  3.07(a) ) or NewCo, as applicable, disapproves a Special Approval Matter that is the subject of such Approval Request (a “ Disapproval Notice ”), subject to Section  3.3 of the Share Rights Agreement, the Independent Third Party (or United, if United has delivered a United Approval Notice with respect to the rights under this Section  3.07(a) ) or NewCo, as applicable, shall be deemed to have approved such Special Approval Matter (as described in the particular Approval Request), provided that such Special Approval Matter is actually submitted to the Board and/or, if required, the Company’s shareholders, for their consideration and approval, and is actually approved by the Board and/or the Company’s shareholders, as applicable. For the avoidance of doubt, if neither the Independent Third Party (or United, if United has delivered a United Approval Notice with respect to the rights under this Section  3.07(a) ) nor NewCo delivers a Disapproval Notice prior to the relevant Board meeting or shareholder meeting, then, such Board or shareholder meeting shall proceed to consider such Special Approval Matter and vote on it (all in accordance with applicable Law, the Company’s Organization Documents and, if applicable, this Agreement); provided, however , that either the Independent Third Party (or United, if United has delivered a United Approval Notice with respect to the rights under this Section  3.07(a) ) or NewCo may deliver a Disapproval Notice following such meeting in accordance with the provisions of this Section  3.07(c) ; provided further, however , that, if a Disapproval Notice is issued after the applicable meeting has been held, then, so long as the Company has not taken any action with respect to such Special Approval Matter that is binding on the Company, each of the Shareholders shall vote their respective Common Shares at a special meeting of shareholders or in any written consent executed in lieu of such a meeting, and shall cause their respective Directors to vote, and shall take all other actions necessary, to adopt a resolution to revoke the approval of such Special Approval Matter or cause the Company to abstain from taking any action with regards to such Special Approval Matter for which a Disapproval Notice was issued. The Company hereby agrees that any Approval Request that is required to be delivered to any party to the JAA pursuant to the terms hereof shall be simultaneously delivered to United, any United Designees and the Independent Third Party in the manner set forth in Section 7.02.

 

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Section 3.08     Officers .

(a)    In the event that any vacancy occurs in the office of the Chief Executive Officer (“ CEO ”) of the Company, the incumbent CEO of the Company (the “ Incumbent CEO ”) shall engage an internationally recognized search firm to identify and recommend successor CEO candidates; provided that, in the event there is no Incumbent CEO or, in the judgment of a majority of the Independent Directors, it would not be advisable for the Incumbent CEO to engage such search firm, such firm shall be selected by the Board and approved by a majority of the Independent Directors. The search firm shall be directed to recommend to the Board a slate of at least three (3) individuals to serve in such vacant CEO position; provided that, to the extent (i) a slate of three (3) to (and including) five (5) individuals is recommended, each of the Independent Third Party (or United, if United has delivered a United Approval Notice with respect to the rights under this Section  3.08 ) and NewCo shall have the right to remove any one (1) individual from such slate, and (ii) a slate of six (6) or more individuals is recommended, each of the Independent Third Party (or United, if United has delivered a United Approval Notice with respect to the rights under this Section  3.07(a) ) and NewCo shall have the right to remove up to one-third (1/3) of the individuals from such slate. The remaining slate of candidates (following any removal of candidates by the Independent Third Party (or United, if United has delivered a United Approval Notice with respect to the rights under this Section  3.07(a) ) or NewCo) shall be presented to and interviewed by the full Board, which shall select from among such candidates by a Majority Vote a successor CEO (the “ Successor Designation ”). As promptly as practicable following any Successor Designation, the Board shall take all actions as may be necessary pursuant to and in accordance with applicable Law and the Organization Documents of the Company to appoint the successor CEO.

(b)    In the event that any vacancy occurs in the office of the Chief Financial Officer (“ CFO ”) of the Company, the Incumbent CEO shall identify and recommend successor CFO candidates. The Incumbent CEO shall recommend a slate of at least three (3) individuals to serve in such vacant CFO position; provided that, to the extent (i) a slate of three (3) to (and including) five (5) individuals is recommended, each of the Independent Third Party (or United, if United has delivered a United Approval Notice with respect to the rights under this Section  3.07(a) ) and NewCo shall have the right to remove any one (1) individual from such slate, and (ii) a slate of six (6) or more individuals is recommended, each of the Independent Third Party (or United, if United has delivered a United Approval Notice with respect to the rights under this Section  3.07(a) ) and NewCo shall have the right to remove up to one-third (1/3) of the individuals from such slate. The Incumbent CEO shall then identify from the remaining slate of candidates (following any removal of candidates by the Independent Third Party (or United, if United has delivered a United Approval Notice with respect to the rights under this Section  3.07(a) ) or NewCo) one (1) individual to be recommended to the Human Resource committee of the Board (the “ HR Committee ”) for such vacant CFO position. If the HR Committee approves and recommends such individual to the full Board for approval, then, subject to the Board’s approval of such individual, the Board shall take all actions as may be necessary pursuant to and in accordance with applicable Law and the Organization Documents of the Company to appoint such individual as the successor CFO.

 

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(c)    Promptly following the appointment of the Consensus Directors, and at any time when there is a vacancy in the office of the Secretary of the Company, the Secretary of the Company shall be identified and recommended by the Consensus Directors. As promptly as practicable following the recommendation by the Consensus Directors of an individual to serve as Secretary of the Company, the Board shall take all actions as may be necessary pursuant to and in accordance with applicable Law and the Organization Documents of the Company to appoint the Secretary of the Company recommended by the Consensus Directors; provided , however , that, if the Board rejects the candidate proposed by the Consensus Directors, then, the Board shall explain in writing with reasonable detail the rationale for such rejection and request the Consensus Directors to recommend another candidate to be appointed as Secretary of the Company, in which case the Board shall promptly, but in any event within five Business Days following the recommendation of such other candidate, take all actions as may be necessary pursuant to and in accordance with applicable Law and the Organization Documents of the Company to appoint the Secretary of the Company recommended by the Consensus Directors. At any time that the Consensus Directors determine in good faith that the Secretary is not performing satisfactorily his or her duties, the Consensus Directors may recommend to the Board to remove the Secretary, and the Shareholders of the Company agree to cause their respective Directors to vote, and shall take all other actions necessary, to remove the Secretary.

Section 3.09     Termination of Certain Rights . Notwithstanding anything in this Agreement to the contrary, (i) the Kingsland Director Rights shall automatically terminate upon the consummation of the Transfer of all of the Put Shares (other than to a Permitted Transferee), whether pursuant to the Put Option Agreement, or otherwise in accordance with the terms and conditions of this Agreement and the Share Rights Agreement (a “ Kingsland Termination Event ”) and (ii)  Section  4.04 shall terminate in accordance with clause  (d) thereof.

ARTICLE IV

TRANSFER OF SHARES

Section 4.01     Legends . The Company shall affix to each certificate evidencing Common Shares issued to the Shareholders a legend in substantially the following form:

“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AS SET FORTH IN THE SHARE RIGHTS AGREEMENT, DATED AS OF NOVEMBER __, 2018, AND THE AMENDED AND RESTATED JOINT ACTION AGREEMENT, DATED AS OF NOVEMBER __, 2018, AS SUCH DOCUMENTS MAY BE AMENDED OR AMENDED AND RESTATED FROM TIME TO TIME, A COPY OF EACH OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF THE COMPANY. NO REGISTRATION OF TRANSFER OF THESE SHARES WILL BE MADE ON THE BOOKS OF THE COMPANY UNLESS AND UNTIL SUCH RESTRICTIONS SHALL HAVE BEEN COMPLIED WITH.”

Section 4.02     Certain Restrictions on Sale and Encumbrance . Notwithstanding anything to the contrary set forth in this Agreement or in the Transaction Documents, including, but not limited to, this Article IV , no Shareholder shall, or shall permit any of its Affiliates or owners to, under any circumstance, directly or indirectly (including through the Sale or other Transfer of securities

 

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of any Person that is an owner of or Controls any Person that is an owner of such securities) make, solicit or permit any Sale, Transfer, assignment or other disposition of, or create, incur or assume any Lien with respect to, any Capital Stock owned by such Shareholder, Affiliate or owner to a Non-Permitted Holder; provided, however , that the foregoing restriction in this Section  4.02 shall not apply to any Sale or other Transfer of securities by United or a United Designee. The provisions of this Section  4.02 shall not apply to any open market sale on any an established U.S. or foreign securities exchange or automated quotation system on which the Capital Stock is listed or quoted; provided that the relevant Shareholder or its Affiliates or owner acts in good faith without any intention to circumvent the provisions of this Section  4.02 and has no knowledge that the purchaser in such open market sale is or is likely to be a Non-Permitted Holder or acting in concert with, or as a part of a group that includes, any Non-Permitted Holder. Notwithstanding anything to the contrary, (a) any Shareholder Group shall be permitted to acquire and own interests, including security, derivative or other direct or indirect interests, in the Capital Stock, and to obtain and exercise options or other rights to acquire Capital Stock to the extent provided for in the Share Rights Agreement, while it is in force and effect; (b) United and its Affiliates, the United Designee, Kingsland and the Independent Third Party shall be entitled to exercise all Common Share voting rights including by way of usufruct in a manner consistent with the Transaction Documents; (c) United and its Affiliates shall be permitted to have a security interest in and Lien on the Capital Stock, and the exercise by United or its Affiliates of all rights arising under the Loan Documents (as such term is defined in the NewCo Loan Agreement), including United’s (or its Affiliates) right to foreclose on its security interest in, taking ownership of and exercising the rights of ownership (including the right to vote) in the Capital Stock and allowing any such shares that are Common Shares to remain voting shares; and (d) only with respect to the Common Shares that United acquires pursuant to the AVH Call Option Agreement (such Common Shares, collectively, the “ Optioned AVH Shares ”), United may not Transfer or cause to be Transferred any Optioned AVH Shares to a third party, unless such Optioned AVH Shares are first converted into Preferred Shares; provided , however , that the transfer restriction in this clause  (d) shall not apply (i) for so long as an Event of Default has occurred and is continuing, (ii) if Synergy, NewCo or any Affiliate of NewCo has breached its material obligations under any Transaction Document to which it is a party and such breach has not been waived or cured, if capable of being cured or (iii) to any Transfer by United or a United Designee of Shares in accordance with Section  2.3 of the Share Rights Agreement or in connection with the exercise of United’s rights under Section  2.7 or Section  2.8 of the Share Rights Agreement; provided further , however , if such conversion of Optioned AVH Shares into Preferred Shares by United would otherwise (x) cause all of the Preferred Shares to have voting rights pursuant to the Company’s Organization Documents or (y) cause Synergy and Kingsland to lose Control of the Company, then, United will have the right to Transfer (without first having to convert into Preferred Shares) the amount of Common Shares that exceed the number of Shares that can be converted without triggering the events described in clause  (x) or (y)  above. For the avoidance of doubt, nothing herein shall limit Kingsland’s ability to Transfer the Put Shares to United, a United Designee or NewCo pursuant to the Put Option Agreement or otherwise exercise its rights or perform its obligations under the Put Option Agreement and the other agreements entered into in connection therewith.

Section 4.03     Improper Sale or Encumbrance . Any attempt not in compliance with this Agreement to make any Sale or Transfer of, or create, incur or assume any Lien with respect to, any Capital Stock shall be null and void and of no force and effect, the purported transferee shall have no rights or privileges in or with respect to the Company or under this Agreement, and the Company shall not give any effect in the Company’s stock records to such attempted Sale, Transfer or Lien.

 

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Section 4.04     Tag-Along Right .

(a)    Subject to Article 2 of the Share Rights Agreement, in the event that Synergy intends to effect a transaction that would constitute a Synergy Change in Control (a “ Synergy Change in Control Transaction ”), Synergy shall provide to Kingsland written notice of its intention to enter into such Synergy Change in Control Transaction, which notice shall set forth (i) the name and address of the Person with whom Synergy is entering into such Synergy Change in Control Transaction (the “ Synergy Buyer ”) and (ii) the value ascribed for the Common Shares in connection with such Synergy Change in Control Transaction. Upon receipt of such notice, then Kingsland shall have the right to, within thirty (30) days, irrevocably elect to sell all, but not less than all, of the Kingsland Group’s Common Shares (the “ Tag-Along Shares ”) to the Synergy Buyer or, if the Synergy Buyer fails to purchase such shares, to Synergy; provided, however , that prior the tenth anniversary of the date hereof, Kingsland may not exercise such right unless the price per Common Share exceeds US$1.5625 (as adjusted for the occurrence of any Adjustment Event). Failure by Kingsland to make an election pursuant to this Section  4.04(a) within the 30-day election period shall constitute an election to decline to sell pursuant to this Section  4.04(a) . If Kingsland elects not to sell the Tag-Along Shares pursuant to this Section  4.04(a) , the Synergy Buyer shall be required to execute and deliver an Accession Agreement that has the effect of making this Agreement a legal, valid and binding obligation of the Synergy Buyer enforceable against it in accordance with its terms. If Kingsland elects to sell the Tag-Along Shares pursuant to this Section  4.04(a) (the date on which Kingsland delivers notice to Synergy of such election, the “ Kingsland Election Date ”), (i) Synergy shall cause the Synergy Buyer to purchase all of the Tag-Along Shares at the closing of the Synergy Change in Control Transaction and if the Synergy Buyer fails to do so and the closing of the Synergy Change in Control Transaction occurs, then Synergy (or, if the reason that the purchase of the Tag-Along Shares has not been completed is due to the ongoing valuation procedures in accordance with Section  4.04(c) , the Synergy Buyer if the Synergy Buyer confirms in writing its obligation to make such purchase in accordance with this Section 4.04) shall be obligated to purchase the Tag-Along Shares, and (ii) the Kingsland Group shall take all lawful action reasonably requested by the Synergy Buyer to complete the Sale contemplated by the Synergy Change in Control Transaction, including the surrender to the Synergy Buyer of any stock certificates representing such shares properly endorsed for transfer to the Synergy Buyer against payment of the sale price for such shares, and if so reasonably requested by the Synergy Buyer, the execution of all sale and other agreements in the form requested; provided that the Kingsland Group shall not be required to make any representation, warranty, or commitment in any such agreement except representations and warranties as to their power and authority to Transfer such shares free and clear of all Liens, their unencumbered title to such shares, and the absence of any litigation, Laws or agreements which would impede the Transfer of such shares. The consideration to be paid to the Kingsland Group by either the Synergy Buyer or Synergy for the Tag-Along Shares pursuant to a transaction contemplated by this Section  4.04(a) , shall be equal to Tag-Along Price (as defined in Section 4.04(b)). If the Synergy Change in Control Transaction does not close, the notice provided pursuant to this Section  4.04(a) shall be deemed to have been withdrawn and the obligation to comply with this Section  4.04(a) shall continue in effect.

 

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(b)    For purposes of this Section 4.04,

(i)    the term “ Tag-Along Price ” means (x) to the extent the Synergy Change in Control Transaction involves only equity securities of the Company, Kingsland’s pro  rata portion of the amount paid or proposed to be paid for such equity securities based on Kingsland’s Common Shares (on a fully diluted basis) relative to all outstanding Capital Stock (on a fully-diluted basis), or (y) to the extent the Synergy Change in Control Transaction does not involve only equity securities of the Company, the value per share of Common Share, determined on the basis of the amount paid or proposed to be paid for the assets or equity securities of Synergy or other Person(s) involved in the Synergy Change in Control Transaction either (A) by agreement between Synergy and Kingsland within fifteen (15) days after the date Kingsland elects to sell the Tag-Along Shares pursuant to Section  4.04(a) , or (b) by utilizing the Fair Value of the Company; and

(ii)    the term “ Fair Value of the Company ” means the value of the Company determined in accordance with the procedure set forth in Section  4.04(c) .

(c)    In the event that Synergy and Kingsland are unable to agree on the Tag-Along Price within fifteen (15) days after the Kingsland Election Date pursuant to Section  4.04(b)(i)(y)(A) , the parties shall proceed to determine the “ Fair Value of the Company ” as of the date of notice of the Synergy Change in Control Transaction in accordance with the following procedures:

(i)    Synergy and Kingsland shall (x) attempt to mutually agree on a single internationally recognized investment banking or valuation firm (the “ Mutual Appraiser ”), and if they are unable to do so prior to the twentieth (20th) Business Day after the Kingsland Election Date, each of Synergy and Kingsland shall (y) appoint its own internationally recognized investment banking or valuation firm (each an “ Initial Appraiser ”, and together, the “ Initial Appraisers ”).

(ii)    Within thirty (30) days after it becomes necessary to determine the Fair Value of the Company (the “ Initial Valuation Date ”), the Mutual Appraiser (if appointed) or each of the Initial Appraisers, as applicable, shall deliver its fair value determination to each of Kingsland and Synergy. For purposes of this Agreement, the Fair Value of the Company shall be determined as follows: (x) by the Mutual Appraiser (if appointed) or (y) if the Initial Appraisers are appointed then (A) the Fair Value of the Company determined by the Initial Appraisers, if the fair value amounts so determined by them are the same, or (B) if the fair value amounts determined by the Initial Appraisers are not the same, an amount equal to the quotient of (i) the sum of the fair value amounts determined by the Initial Appraisers, divided by (ii) two (2); provided that if the fair value amounts as determined by the Initial Appraisers are different and the difference between the two valuations is greater than ten percent (10%) of the lower of the two valuation amounts, then: (1) within five (5) Business Days after the Initial Valuation Date, the Initial Appraisers shall jointly select one of the top ten investment banking or valuation firms as set forth on Bloomberg’s latest league table list of such firms (the “ Final Appraiser ” and together with the Mutual Appraiser and the Initial Appraiser, the “ Appraiser ”) to determine which of the Initial Appraisers properly determined the fair value of the Company; (2) the Company shall engage the Final Appraiser within ten (10) Business Days after such

 

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selection; (3) within thirty (30) days after the Final Appraiser is engaged by the Company, the Final Appraiser shall notify Kingsland and Synergy of its determination of which Initial Appraiser properly determined the Fair Value of the Company; and (4) the fair value amount determined by the Initial Appraiser selected by the Final Appraiser as having properly determined such fair value amount shall constitute the Fair Value of the Company.

(iii)    For purposes of determining the Fair Value of the Company, each Appraiser shall be instructed (x) that the Fair Value of the Company shall not exceed the total amount paid in connection with the Synergy Change in Control Transaction, (y) to employ such valuation techniques as are customarily used by investment banks or valuation firms in performing independent valuations in transactions involving the sale of the entire equity interest in a company, including: (A) discounted cash flows, (B) publicly available terms of sale transactions involving companies comparable to the companies involved, including the Company, and the consideration paid in such transactions, (C) to the extent publicly available, valuation multiples on comparable companies and other conventional metrics, and (D) if the capital stock of any of the companies involved, including the Company, is listed for trading on a U.S. or foreign stock exchange or quoted on a U.S. or foreign recognized automated quotation or over-the-counter trading system, the historic and current trading price of such capital stock on such exchange, over-the-counter or automated quotation system on which such capital stock is listed or traded, and (z) that it may take into account the value of any other assets being acquired by the Synergy Buyer in the Synergy Change in Control Transaction. Each Appraiser shall use the same valuation techniques as each other Appraiser. The Company shall provide the Appraisers appointed hereunder with equal time and access to the books and records of the Company, and Synergy shall use its reasonable best efforts to provide the Appraisers appointed hereunder with equal time and access to the books and records of the other companies involved in the Synergy Change in Control Transaction, including but not limited to all financial and accounting information reasonably necessary to conduct such valuation. The fees and expenses of the Mutual Appraiser (if appointed) and both Initial Appraisers shall be borne by the Company. If a Final Appraiser is appointed, the fees and expenses of the Final Appraiser shall be borne solely by (i) Synergy, if the Final Appraiser determines that the Initial Appraiser appointed by Kingsland properly determined the Fair Value of the Company or (ii) Kingsland, if the Final Appraiser determines that Initial Appraiser appointed by Synergy properly determined the Fair Value of the Company.

(d)    Notwithstanding anything in this Agreement to the contrary, this Section  4.04 shall terminate and have no further force or effect as of the date that the Kingsland Group owns less than 10% of the then outstanding Common Shares (it being understood and agreed that the Kingsland Group shall be permitted to fully exercise its rights under this Section  4.04 and Transfer all of its Common Shares in connection with a Synergy Change in Control Transaction so long as it owns at least 10% of the then outstanding Common Shares immediately prior to such rights being triggered under this Section  4.04 ).

 

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ARTICLE V

ANNUAL BUSINESS PLAN AND BUDGET

Section 5.01     Annual Business Plan and Budget . The Company shall conduct the business in accordance with the Business Plan and Budget, which shall be considered Confidential Information. The Board shall review a Business Plan and Budget for each fiscal year not less than thirty (30) days prior to the beginning of such fiscal year which Business Plan and Budget shall be approved, subject to Section  3.07 , no less than fifteen (15) days prior to the beginning of such fiscal year and updated by the Board no less frequently than quarterly to take into consideration changing market conditions. A draft of the Business Plan and Budget shall be provided to NewCo and the Independent Third Party (or United, if it has succeeded to this right of the Independent Third Party pursuant to the Share Rights Agreement), by October 31st of the year preceding such fiscal year, and the Company’s management shall consider all input received from such parties following their review of such draft Business Plan and Budget and make appropriate revisions prior to submitting the Business Plan and Budget to the Board pursuant to this Section  5.01 .

For all purposes of this Agreement, the “ Business Plan and Budget ” shall:

(a)    be prepared in sufficient detail so as to give the Directors, to the extent possible, a true and fair view of the current and anticipated future financial position of the Company;

(b)    set out in detail particulars of the Company’s proposed business strategy, business activities, marketing plans, sales targets, expected revenues and expenditures, financing plans including proposed debt and equity funding, timeline for implementation, staff requirements, and other relevant matters affecting or in relation to the business during the current and next fiscal year;

(c)    contain a business plan for the next 5 years (beginning with the next fiscal year, forecasting on a rolling basis);

(d)    contain a one-year bottom-up forecast comprised of (i) a statement of financial performance for the fiscal year, including a revenue and expense forecast and a budget, (ii) a statement of financial position as at the end of the fiscal year and (iii) a statement of cash flows including a detail of the capital expenditures for such fiscal year; and

(e)    include schedules of all approvals sought for material changes in aircraft purchase and sale agreements, financing or refinancing agreements, and lease or sublease agreements (whether as lessee/sublessee or lessor/sublessor).

ARTICLE VI

ADDITIONAL AGREEMENTS

Section 6.01     Certain Transferees to Execute Agreement .

(a)    Each Shareholder agrees that it will not, during the term of this Agreement, directly or indirectly, make any Sale with respect to any Common Shares owned by such Shareholder to any Permitted Transferee, unless prior to, or contemporaneously with, the consummation of any such Sale, the Permitted Transferees to whom such Sale is proposed to be or is made executes and

 

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delivers to the Company an Accession Agreement in the form attached hereto as Exhibit  A (the “ Accession Agreement ”). Upon the execution and delivery by such Permitted Transferee of such an Accession Agreement, this Agreement shall be amended to reflect the addition of such Permitted Transferee and any other changes in the ownership of Common Shares, and such Permitted Transferee shall be deemed a “Shareholder” for purposes of this Agreement and shall have the rights and be subject to the obligations of a Shareholder under this Agreement, in each case, with respect to the Common Shares owned by such Permitted Transferee.

(b)    All rights hereunder exercisable by the NewCo Group or any member thereof shall be exercised by NewCo on behalf all members of the NewCo Group, and each Permitted Transferee of the NewCo Group shall in its Accession Agreement irrevocably constitute and appoint NewCo as his or its attorney-in-fact and agent in connection with the transactions contemplated by this Agreement, such power to be irrevocable and coupled with an interest and not affected by the death, incapacity, illness or other inability to act of such Permitted Transferee. Without limiting the foregoing, NewCo shall have the power and authority on behalf of each member of the NewCo Group to give any and all notices, consents, approvals or waivers, and to make or agree to make any and all amendments or modifications to this Agreement deemed by NewCo in its sole discretion to be necessary or appropriate.

(c)    All rights hereunder exercisable by the Kingsland Group or any member thereof shall be exercised by Kingsland on behalf of all members of the Kingsland Group, and each Permitted Transferee of the Kingsland Group shall in its Accession Agreement irrevocably constitute and appoint Kingsland as his or its attorney-in-fact and agent in connection with the transactions contemplated by this Agreement, such power to be irrevocable and coupled with an interest and not affected by the death, incapacity, illness or other inability to act of such Permitted Transferee. Without limiting the foregoing, Kingsland shall have the power and authority on behalf of each member of the Kingsland Group to give any and all notices, consents, approvals or waivers, and to make or agree to make any and all amendments or modifications to this Agreement deemed by Kingsland in its sole discretion to be necessary or appropriate.

(d)    All rights hereunder exercisable by the United Group or any member thereof shall be exercised by United, or if designated by United, the United Designee, on behalf of all members of the United Group, and each Permitted Transferee of the United Group shall in its Accession Agreement irrevocably constitute and appoint United, or if designated by United, the United Designee, as his or its attorney-in-fact and agent in connection with the transactions contemplated by this Agreement, such power to be irrevocable and coupled with an interest and not affected by the death, incapacity, illness or other inability to act of such Permitted Transferee. Without limiting the foregoing, United, or if designated by United, the United Designee, shall have the power and authority on behalf of each member of the United Group to give any and all notices, consents, approvals or waivers, and to make or agree to make any and all amendments or modifications to this Agreement deemed by United, or if designated by United, the United Designee, in its sole discretion to be necessary or appropriate.

Section 6.02     Conversion Rights .

(a)    Subject to the Section 3.4 of the Share Rights Agreement, any Shareholder Group other than the United Group may voluntarily convert any of its Common Shares into Preferred

 

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Shares or other form of convertible security, except that (i) while any Obligations are outstanding, any Common Shares owned by NewCo and Kingsland shall be converted only as permitted under, and in accordance with, the Transaction Documents and (ii) if any such conversion would otherwise (x) cause all of the Preferred Shares to have voting rights pursuant to the Company’s Organization Documents or (y) cause Synergy and Kingsland to lose Control of the Company, then such conversion shall not be effectuated.

(b)    The United Group or a United Designee, as applicable, shall have the right to voluntarily convert any of their Common Shares into Preferred Shares or other form of convertible security without NewCo’s, the Independent Third Party’s or Kingsland’s prior written consent, and to the extent that a shareholders meeting, regular or special, is required to approve such conversion pursuant to the Company’s Organization Documents, each of NewCo and Kingsland hereby agrees to vote its Capital Stock at any regular or special meeting of shareholders approving such conversion of Common Shares to Preferred Shares by United or such United Designee. To the extent that any written consent (whether in lieu of a shareholders meeting or otherwise) from NewCo or Kingsland is required to approve such conversion pursuant to the Company’s Organization Documents, this Section  6.01(b) shall constitute the irrevocable written consent of each of NewCo and Kingsland to such conversion of Common Shares to Preferred Shares by United or such United Designee.

ARTICLE VII

MISCELLANEOUS

Section 7.01     Termination . This Agreement shall terminate on the earliest of:

(a)    the date on which no member of the United Group owns any Common Shares;

(b)    the date on which no member of the NewCo Group owns any Common Shares;

(c)    on the tenth anniversary of this Agreement, if prior to the tenth anniversary of this Agreement, United (or the United Designee, as applicable) rejects NewCo’s offer to purchase all but one share of the Capital Stock held by the United Group pursuant to, and in accordance with, Section  3.3(a)(iii) of the Share Rights Agreement, and NewCo notifies the parties hereto of its election to terminate this Agreement within 10 Business Days of such rejection or deemed rejection by United (or a United Designee, as applicable) of NewCo’s offer;

(d)    the date on which United (or the United Designee, as applicable) rejects NewCo’s offer to purchase all (but not less than all) of the Capital Stock held by the United Group pursuant to, and in accordance with, Section  3.3(a)(v) of the Share Rights Agreement, and NewCo notifies the parties hereto of its election to terminate this Agreement upon such rejection or deemed rejection by United (or a United Designee, as applicable) of NewCo’s offer to purchase all (but not less than all) of the Capital Stock held by the United Group pursuant to, and in accordance with, Section  3.3(a)(v) of the Share Rights Agreement; and

(e)    the date on which NewCo rejects United’s offer to purchase all (but not less than all) of the Capital Stock held by the NewCo Group pursuant to, and in accordance with, Section  3.3(a)(vii) of the Share Rights Agreement and United notifies the parties hereto of its election to terminate this Agreement upon such rejection or deemed rejection by NewCo of United’s offer to purchase all (but not less than all) of the Capital Stock held by the NewCo Group pursuant to, and in accordance with, Section  3.3(a)(vii) of the Share Rights Agreement;

 

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provided, however , that, notwithstanding anything contained herein to the contrary, this Agreement shall continue in full force and effect until NewCo has paid in full its Obligations; provided further, however , that no termination of this Agreement pursuant to this Section  7.01 shall affect the right of any party to recover damages or collect indemnification for any breach of the representations, warranties or covenants herein that occurred prior to such termination and provided further that this Section  7.01 , Section  7.02 , and Section  7.04 through Section  7.17 shall survive the termination of this Agreement.

Section 7.02     Notices . All notices, requests, demands and other communications (collectively, “ Notices ”) required or permitted to be given hereunder shall be in writing and delivered (a) personally, (b) by electronic transmission, which is confirmed by the recipient (in the case of email, an automated reply shall not constitute confirmation by the recipient), or (c) mailed by a recognized courier service to the address designated on Schedule  II hereto. All Notices shall be effective upon receipt, except that a Notice given by electronic transmission will be effective on the date sent (with confirmation of transmission) if sent during normal business hours of the recipient or on the next Business Day if sent (with confirmation of transmission) after the normal business hours of the recipient. Any party may change its Notice information by giving written Notice to all other parties in the manner specified above. Upon selection of the Independent Third Party pursuant to Section  3.9 of the Share Rights Agreement, the Independent Third Party will provide its Notice information by giving written Notice to all other parties in the manner specified above.

Section 7.03     Press Releases . No Party shall issue any press release or other public disclosure using the name, logo or otherwise referring to the other Parties or any of their respective Affiliates or this Agreement or any of the other Transaction Agreements, or otherwise in connection with the transactions contemplated hereby or thereby, without the prior written consent of the other Parties; provided that each Party shall be free to issue such press releases and make such disclosures as may be necessary to comply with applicable Laws and stock exchange rules; provided , further , however , that, to the extent practicable, each Party shall provide the other Parties a draft of such press release or disclosure in advance of its release and, if practicable, an opportunity to offer comments, which comments such first Party shall have no obligation to accommodate or reflect in such press release or disclosure (it being understood that, in the case of disclosures required for United or the Company to comply with U.S. Securities and Exchange regulations, stock exchange rules or any other securities and stock exchange rules of other jurisdictions, as applicable, such practicable opportunity for Kingsland, NewCo or United, as applicable, to comment on United’s or the Company’s draft disclosures may from time to time be limited or non-existent).

Section 7.04     Cumulative Remedies . The rights and remedies provided by this Agreement are cumulative and the use of any one right or remedy by any party shall not preclude or waive its right to use any or all other remedies. Said rights and remedies are given in addition to any other rights the parties may have by Law or otherwise.

 

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Section 7.05     Binding Effect . This Agreement shall be binding upon and inure to the benefit of all of the parties and, to the extent permitted by this Agreement, their successors, executors, administrators, heirs, legal representatives and assigns.

Section 7.06     Interpretation .

(a)    All article, section, subsection, preamble, recital or exhibit references used in this Agreement are to an article, section, subsection, preamble or recital to this Agreement unless otherwise specified. All exhibits attached to this Agreement constitute a part of this Agreement and are incorporated herein for all purposes. If a term is defined as one part of speech (such as a noun), it shall have a corresponding meaning when used as another part of speech (such as a verb). Unless the context of this Agreement clearly requires otherwise (i) the singular shall include the plural and the plural shall include the singular wherever and as often as may be appropriate, (ii) the words “includes” or “including” shall mean “including without limitation”, (iii) the words “hereof,” “hereby,” “herein,” “hereunder” and similar terms in this Agreement shall refer to this Agreement as a whole and not any particular article, section, subsection or exhibit, in which such words appear, (iv) the words “own” or “owns” or “ownership” or “owner” and words with correlative meaning shall mean Beneficially Own or Beneficial Ownership or Beneficial Owner, as applicable and (v) the gender of all words used in this Agreement includes the masculine, feminine and neuter.

(b)    The headings of articles, sections, subsections or exhibits of this Agreement are for purposes of reference only and shall not limit or otherwise affect the meaning or interpretation of this Agreement.

(c)    References to any Law will include all rules and regulations promulgated thereunder, and references to any Law will be construed as including any legal and statutory provisions consolidating, amending, succeeding or replacing such Law.

(d)    References to any document will include any amendment, restatement or supplement to, or replacement or novation of, such document, but disregarding any amendment, restatement, supplement, replacement or novation made in breach of this Agreement.

(e)    Except as may be otherwise expressly provided, any reference herein to an approval, consent, determination, election, exercise of right, decision, removal or similar discretionary act of a Person or body shall mean that such is to be made in the sole and absolute discretion of such Person or body.

(f)    Where any provision in this Agreement refers to action to be taken by any Person, or which such Person is prohibited from taking, such provision will be applicable whether such action is taken directly or indirectly by such Person, including actions taken by or on behalf of any Affiliate of such Person.

(g)    Currency amounts referenced herein, unless otherwise specified, are in U.S. Dollars.

(h)    All accounting terms used herein and not otherwise defined herein will have the meanings accorded them in accordance with IFRS and, except as expressly provided herein, all accounting determinations will be made in accordance with such accounting standards in effect from time to time.

 

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(i)    Each party acknowledges that it has the relevant experience and sophistication required to adequately assess and evaluate the risks associated with the transactions contemplated hereby and to make the investment decision (as applicable) contemplated hereby. Each party has had an adequate opportunity to review each and every provision of this Agreement and to submit the same to legal counsel for review and advice. Based on the foregoing, the language used in this Agreement shall be deemed to be the language chosen by the parties to express their mutual intent, and the rule of construction, if any, that a contract be construed against the drafter shall not apply to interpretation or construction of this Agreement.

(j)    If at any time the number of Preferred Shares of the Company comprising an AVH ADS is no longer eight, all references in this Agreement to “divided by eight” or similar phrases will be deemed to be changed to reflect the actual number of Preferred Shares comprising each AVH ADS at such time.

Section 7.07     Severability . In the event any of the provisions hereof are held to be invalid or unenforceable under any Law, the remaining provisions hereof shall not be affected thereby. In such event, the parties agree and consent that such provisions and this Agreement shall be modified and reformed so as to effect the original intent of the parties as closely as possible with respect to those provisions which were held to be invalid or unenforceable. Notwithstanding the foregoing and the fact that the Company is incorporated under the Laws of Panama, the parties agree that the rights and obligations contained in this Agreement shall be governed, construed and enforced in accordance with Section  7.10 .

Section 7.08     Counterparts . This Agreement may be executed and delivered (including by facsimile transmission or by electronic mail in “portable document format” (“.pdf”) form) in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed and delivered shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. Copies of executed counterparts transmitted by telecopy, electronic mail or other electronic transmission service shall be considered original executed counterparts for purposes of this Section  7.08 .

Section 7.09     Entire Agreement . The Transaction Documents set forth the entire agreement and understanding of the parties in respect of the matters addressed herein and supersede all prior agreements, arrangements and undertakings (oral or written) relating to the subject matter hereof. No representation, promise, inducement or statement of intention has been made by any party which is not embodied in or superseded by the Transaction Documents, and no party shall be bound by or liable for any alleged representation, promise, inducement or statement of intention not so set forth; provided , however , that it is understood that certain parties and their Affiliates are also entering into other agreements with respect to the ownership of the Company’s shares or the operation of the Company as of the date hereof, and it being further understood that the Organization Documents of the Company contain various terms that are also applicable to the parties, as set forth therein.

 

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Section 7.10     GOVERNING LAW; JURISDICTION, ETC .

(a)     GOVERNING LAW . THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAWS, BUT OTHERWISE WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES).

(b)     SUBMISSION TO JURISDICTION . EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION OR PROCEEDING OF ANY KIND OR DESCRIPTION, WHETHER IN LAW OR EQUITY, WHETHER IN CONTRACT OR IN TORT OR OTHERWISE, AGAINST ANY OTHER PARTY IN ANY WAY RELATING TO THIS AGREEMENT OR THE TRANSACTIONS RELATING HERETO, IN ANY FORUM OTHER THAN THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION, LITIGATION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION, LITIGATION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AGAINST ANY OTHER PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(c)     WAIVER OF VENUE . EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT IN ANY COURT REFERRED TO IN Section  7.10(b) . EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

(d)     SERVICE OF PROCESS . EACH PARTY HERETO HEREBY IRREVOCABLY CONSENTS AND AGREES THAT THE SERVICE OF ANY AND ALL LEGAL PROCESS, SUMMONS, NOTICES AND DOCUMENTS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING MAY BE MADE BY MAILING COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE ADDRESS SPECIFIED IN SCHEDULE II . EACH PARTY HERETO HEREBY AGREES THAT SERVICE UPON IT, OR ANY OF ITS AGENTS, IN EACH CASE, IN ACCORDANCE HEREWITH, SHALL CONSTITUTE VALID AND EFFECTIVE PERSONAL SERVICE UPON SUCH PARTY, AND EACH PARTY HERETO HEREBY AGREES THAT THE FAILURE OF ANY OF ITS AGENTS TO GIVE ANY NOTICE OF SUCH SERVICE TO ANY SUCH PARTY

 

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SHALL NOT IMPAIR OR AFFECT IN ANY WAY THE VALIDITY OF SUCH SERVICE ON SUCH PARTY OR ANY JUDGMENT RENDERED IN ANY ACTION OR PROCEEDING BASED THEREON. KINGSLAND FURTHER HEREBY IRREVOCABLY DESIGNATES, APPOINTS AND EMPOWERS CORPORATION SERVICE COMPANY, WITH OFFICES AT 1180 AVENUE OF THE AMERICAS, NY, NY 10036 AS ITS AUTHORIZED AGENT FOR SERVICE OF PROCESS IN THE STATE OF NEW YORK IN ANY SUIT, ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT. IF, FOR ANY REASON, SUCH AGENT SHALL CEASE TO BE AVAILABLE TO ACT AS SUCH, KINGSLAND AGREES TO DESIGNATE A NEW AGENT IN THE CITY OF NEW YORK, IN THE STATE OF NEW YORK FOR THE PURPOSES OF THIS PROVISION REASONABLY SATISFACTORY TO UNITED.

(e)     WAIVER OF SOVEREIGN IMMUNITY . TO THE EXTENT THAT ANY PARTY HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION, EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, SUCH PARTY HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT AND, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, AGREES THAT THE WAIVERS SET FORTH HEREIN SHALL HAVE THE FULLEST SCOPE PERMITTED UNDER THE UNITED STATES FOREIGN SOVEREIGN IMMUNITIES ACT OF 1976 AND ARE INTENDED TO BE IRREVOCABLE FOR PURPOSES OF SUCH ACT.

(f)     WAIVER OF JURY TRIAL . EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (i) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (ii) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

(g)     Acknowledgement . Each party hereby acknowledges that the waivers in this Section  7.10 are a material inducement to the other parties entering into this Agreement and that each party is relying upon the foregoing in their dealings with the other parties. Each party has reviewed the waivers in this Section  7.10 with their legal counsel and have knowingly and voluntarily waived jury trial and other rights following consultation with legal counsel. In the event of litigation, this Agreement may be filed as a written consent to a trial by the court.

Section 7.11     Specific Performance . The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached or threatened to be breached. It is accordingly agreed

 

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that the parties shall be entitled (without proof of actual damages or otherwise or posting or securing any bond) to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement, these being in addition to any other remedy to which they are entitled at law or in equity. The parties further agree not to assert that a remedy of specific performance is unenforceable, invalid, contrary to Law or inequitable for any reason, nor to assert that a remedy of monetary damages would provide adequate remedy. Each of the parties acknowledges and agrees that the right to specific performance and the other relief contemplated herein is an integral part of the transactions contemplated hereby and without such right, none of the parties would have entered into this Agreement.

Section 7.12     Expenses . Except as otherwise specified in this Agreement, all costs and expenses, including fees and disbursements of counsel, financial advisors and accountants, incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses.

Section 7.13     Amendments and Waivers; Assignment .

(a)    Except as set forth in Section  7.21 , any provision of this Agreement may be amended or waived if, and only if, such amendment or waiver is in writing and signed, in the case of an amendment, by United, NewCo and Kingsland (acting on behalf of the United Group, NewCo Group and Kingsland Group, respectively, pursuant to Section  6.01(b) , Section  6.01(c ) and Section  6.01(d) , as the case may be) and the Company or, in the case of a waiver, by the party or parties against whom the waiver is to be effective.

(b)    No failure or delay by any party in exercising any right, power or privilege hereunder (other than a failure or delay beyond a period of time specified herein) shall operate as a waiver thereof and no single or partial exercise thereof shall preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by Law.

(c)    Except as set forth in Section  6.01 and the assignment of rights by Kingsland to United or a United Designee, this Agreement, and the rights or obligations hereunder, shall not be directly or indirectly assigned without the express written consent of United and NewCo, as applicable (which consent may be granted or withheld in the sole discretion of any party); provided , however , United may, at any time and from time to time, and in its sole discretion, assign, Transfer or convey all or any part of its rights under this Agreement (but not, except as otherwise permitted in this Agreement, its obligations) to a United Designee; provided , however , United may not assign, Transfer or convey any of its rights under this Agreement to a Non-Permitted Holder, provided that no Event of Default has occurred and is continuing. United will provide prior written notice to the Parties no later than 15 Business Days upon any such assignment, Transfer or conveyance.

Section 7.14     No Third-Party Beneficiaries . This Agreement shall be binding upon and inure solely to the benefit of the parties hereto and their Permitted Transferees and to the Independent Third Party, who is expressly made third-party beneficiary of this Agreement and shall have the right to enforce this Agreement directly to the extent it may deem necessary or advisable to protect their rights arising hereunder. Except to the extent expressly set forth herein, nothing herein, express or implied, is intended to or shall confer upon any other Person or entity, any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.

 

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Section 7.15     Shareholders Agreement . This Agreement shall be considered to be a “shareholders agreement” for purposes of the Corporation Law of Panama, Law 32 of February 26, 1927 and other applicable Law of the Republic of Panama.

Section 7.16     Conflict between this Agreement and the Share Rights Agreement . In the event of any conflict between this Agreement (or 100% JAA, as applicable) and the Share Rights Agreement, the Share Rights Agreement shall control, and the Shareholders and the Company shall cause, to the extent necessary, this Agreement (or 100% JAA, as applicable) and the Organization Documents of the Company or of its Material Subsidiaries to be changed, amended or modified to eliminate any such inconsistency.

Section 7.17     Charter Documents; Further Assurances . Each party hereto hereby agrees to take such actions as are reasonably necessary to procure that the Company’s Organization Documents be amended to give effect to and reflect the agreements contained in this Agreement to the extent necessary to ensure that the Company’s Organization Documents do not conflict, and are consistent, with this Agreement, and the Share Rights Agreement, including, in the case of NewCo and Kingsland, calling a special meeting of shareholders and participating in such special meeting (such meeting to occur at the earliest time permitted by the Company’s Organization Documents) or executing any written consent executed in lieu of such a meeting, in each case only for the purpose of adopting such amendments as are necessary to carry out the purpose and intent of this sentence, and each of NewCo and Kingsland shall vote their respective Common Shares at such special meeting of Shareholders or in any written consent executed in lieu of such a meeting, and shall cause their respective Directors to vote, and shall take all other actions necessary, to adopt such amendments. The parties hereto agree that from time to time after the date hereof, they will promptly execute and deliver such further documents and take such further actions, as may be reasonably necessary to carry out the purpose and intent of this Agreement.

Section 7.18     Electronic Transmissions . Each of the parties hereto agrees that (a) any consent or signed document transmitted by electronic transmission shall be treated in all manner and respects as an original written document, (b) any such consent or document shall be considered to have the same binding and legal effect as an original document and (c) at the request of any party, any such consent or document shall be re-delivered or re-executed, as appropriate, by the relevant party or parties in its original form. Each of the parties further agrees that they will not raise the transmission of a consent or document by electronic transmission as a defense in any proceeding or action in which the validity of such consent or document is at issue and hereby forever waives such defense. For purposes of this Agreement, the term “electronic transmission” means any form of communication not directly involving the physical transmission of paper, that creates a record that may be retained, retrieved and reviewed by a recipient thereof, and that may be directly reproduced in paper form by such a recipient through an automated process.

Section 7.19     Consent . Each of the parties agrees to and formalizes its consent, pursuant to Section  7.13(c) of the Original JAA, to the NewCo and United Transfers.

 

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Section 7.20     Confidentiality . Each party agrees to, and to cause its respective Affiliates, officers, directors, employees, accountants, consultants, advisors, and agents (collectively, “ Representatives ”) to, keep confidential all documents and information, oral and written, concerning the parties, including information about the proposed or potential business strategy, operations, financial matters and other matters relating to the Company or the other parties (irrespective of the form of communication and whether such information is furnished before, on or after the date of this Agreement), including the subject matter and content of the Transaction Documents and/or of any other agreements or instruments related hereto or cited herein, any other documents and information related to the Company or the other parties (collectively, the “ Confidential Information ”) and shall not, and shall not permit its Representatives to disclose any of the Confidential Information, or to allow third parties to access the Confidential Information; provided , however , that each party agrees that (i) the other parties may disclose Confidential Information to any Independent Third Party, any United Designee, any Monitor (as defined in the NewCo Loan Agreement), the Independent Accountant (as defined in the Share Rights Agreement), the Independent Banker (as defined in the NewCo Loan Agreement) and their respective Representatives, (ii) United may disclose Confidential Information to its assignee and to the authorized representatives of its labor unions (subject to their confidentiality obligations with United), and (iii) the other parties may disclose Confidential Information to their respective Representatives to the extent reasonably necessary to exercise their respective rights or perform their respective obligations under this Agreement or any of the other Transaction Documents, provided that, in the case of clauses (i)  and (ii) above, such Independent Third Party, United Designee, Monitor, Independent Banker, assignee or Representative, as applicable, is informed of the confidential nature of the Confidential Information and agrees in writing to abide by the provisions of this Section  7.20 or enters into a confidentiality agreement with the parties containing confidentiality provisions that are no less restrictive than the provisions set forth in this Section  7.20 . The limitations set forth in this Section  7.20 do not apply when such Confidential Information (a) is in the public domain through no breach of this Section  7.20 ; (b) becomes public knowledge through no breach of this Section  7.20 ; (c) is disclosed to meet a legal requirement or in connection with any legal proceeding or to comply with a decision by a court or Governmental Authority, so long as (i) the disclosing party promptly notifies the other parties in writing of the order or demand received, (ii) the disclosing party seeks confidential treatment for the Confidential Information and (iii) the disclosing party discloses only such Confidential Information that such disclosing party’s counsel advises is required to be disclosed; (d) is disclosed to meet the disclosure requirements of capital markets regulations, stock exchange rules and applicable Laws; (e) is authorized in writing by the other parties to be disclosed; (f) is received from a third party who, to the receiving party’s knowledge, is not subject to any confidentiality obligations to the disclosing party; or (g) is independently developed by the disclosing party without reference to any Confidential Information. This Agreement supersedes the Kingsland NDA, the AVH United NDA and the Synergy United AVH NDA. All oral and written information exchanged between the parties under those agreements (irrespective of the form of communication and whether such information is furnished before, on or after the date of this Agreement) shall be deemed Confidential Information hereunder and shall be subject to the terms of this Section  7.20 .

Section 7.21     Suspension and Reversion of JAA Provisions .

(a)    Upon delivery by NewCo of a written certification to United (the “ 50% Payment Certification ”) that, as of the date of such 50% Payment Certification:

(i)    NewCo has repaid in cash all of the principal and interest owed in respect of Term Loan A (as defined in the NewCo Loan Agreement);

 

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(ii)    NewCo has made cumulative payments of which the cash portion of such payments is in an amount at least equal to 50% of the sum of:

(A)    US$450,000,000;

(B)    the cumulative amount of all interest that has accrued with respect to the Outstanding Principal Amount (as defined in the NewCo Loan Agreement) from the Funding Date through the date of such 50% Payment Certification;

(C)    an amount equal to the Cooperation Payment Amount (as defined in the NewCo Loan Agreement) as of the date of such 50% Payment Certification; and

(D)    if, as of such date, the Cooperation Payment is made by United under the guaranty set forth in Section  4.1 of the Cooperation Agreement (as defined in the NewCo Loan Agreement), the cumulative amount of all interest that has accrued with respect to the Payment Amount under the Cooperation Agreement from the date of such payment by United through the date of such 50% Payment Certification.

(iii)    the Release Collateral Coverage Ratio (as defined in the NewCo Loan Agreement) is equal to or greater than 200%; and

(iv)    no Event of Default has occurred and is continuing;

United shall have ten (10) Business Days to confirm or correct the calculations set forth in such 50% Payment Certification. If United confirms such calculations and delivers a notice of confirmation to the Parties hereto or United fails to confirm or correct such calculations within such ten (10) Business-Day period and NewCo delivers a notice of such failure to the Parties hereto (the date of any such notice of confirmation from United or such notice of failure from NewCo, each, a “ Suspension Commencement Date ”), subject to Section  7.21(c) , the Suspended JAA Provisions shall automatically be suspended without any further action of any Party as of the date of such notice, and no Party may exercise or enforce the Suspended JAA Provisions during such suspension.

(b)    Upon delivery by NewCo of a written certification to United (the “ 100% Payment Certification ”), that, as of the date of such 100% Payment Certification, NewCo has paid or defeased all of the Obligations (other than those relating to the Untriggered SAR Payment as of the date of the 100% Payment Certification), United shall have ten (10) Business Days to confirm or correct the calculations set forth in such 100% Payment Certification. If United confirms such calculations and delivers a notice of confirmation to the Parties hereto or United fails to confirm or correct such calculations within such ten (10) Business-Day period and NewCo delivers a notice of such failure to the Parties hereto (the “ 100% JAA Notice ”), in each case, with an instruction that this Agreement be deemed to reflect the provisions attached hereto as Exhibit  B (this Agreement, as so amended, the “ 100% JAA ”), then, this Agreement shall be deemed immediately

 

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amended without any further action by any of the Parties hereto, such that the 100% JAA shall be in effect immediately and shall supersede entirely this Agreement as then in effect; provided that the Shareholders shall take all actions reasonably necessary to amend the Organization Documents to reflect the terms of the 100% JAA

(c)    Notwithstanding anything contained in this Section  7.21 , if (A) at any time when (i) there shall have occurred a Key Person Event of the type described in clause (i) of the definition thereof and (ii) an individual set forth on Schedule 1.1D of the NewCo Loan Agreement other than Eduardo Keplacz (or another individual otherwise approved by the Majority Lenders (as defined in the NewCo Loan Agreement)) has replaced such resigned Key Person in connection with such Key Person Event or (B) on any Measurement Date following a Suspension Commencement Date, the Release Collateral Coverage Ratio is not equal to or greater than 200%, this Agreement shall remain in full force and effect without giving effect to any suspension of the Suspended JAA Rights pursuant to Section  7.21(a) . If (i) clause (A) of the immediately preceding sentence shall be inapplicable and (ii) following a Measurement Date referred to in clause (B) of the immediately preceding sentence, the Release Collateral Coverage Ratio is again equal to or greater than 200% on any Measurement Date thereafter, NewCo shall notify the Lenders (as defined in the NewCo Loan Agreement) and the other Shareholders in writing of same and, from the date of such notice and subject to the first sentence of this Section  7.21(c) , the Suspended JAA Provisions shall again automatically be suspended without any further action of any Party as of the date of such notice, and no Party may exercise or enforce the Suspended JAA Provisions during such suspension.

(d)    For purposes of this Agreement, the terms (i) “ Suspended JAA Provisions ” means (A) all rights, duties and obligations of the Executive Committee, including the rights, duties and obligations set forth in the last sentence of Section  3.03(f) and the parenthetical in Section  3.04(b) and (B) (1) the obligation of the Company to submit an Approval Request for the Special Approval Matter set forth in Section  3.07(a)(xviii) and (2) the rights of NewCo and the Independent Third Party (or United, if United delivers a United Approval Notice with respect to such rights) pursuant to Section  3.07 to approve or deliver a Disapproval Notice with respect to the Special Approval Matter set forth in Section  3.07(a)(xviii) ; and (ii) “ Untriggered SAR Payment ” means, as of any date, the SAR Payment (as defined in the AVH Stock Appreciation Rights Agreement) with respect to any Non-Optioned AVH Shares for which there has not been an Exercise (as defined in the AVH Stock Appreciation Rights Agreement) as of such date.

[The remainder of this page was intentionally left blank; signature page follows]

 

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IN WITNESS WHEREOF , the parties hereto have caused this Agreement to be duly executed by their respective authorized signatories hereunto duly authorized as of the date first above written.

 

 

[ Signature Page to Amended and Restated Joint Action Agreement ]

 

[ Signature Page to Amended and Restated Joint Action Agreement ]

 

[ Signature Page to Amended and Restated Joint Action Agreement ]

 

[ Signature Page to Amended and Restated Joint Action Agreement ]

 

[ Signature Page to Amended and Restated Joint Action Agreement ]

SCHEDULE I – Ownership of Common Shares

 

Name of Shareholder		Number of Shares				% Outstanding
NewCo Group
BRW Aviation LLC			515,999,999				78.1	%
Kingsland Group
Kingsland Holdings Limited			144,800,003				21.9	%
United Group
United Airlines, Inc.			1				0	%

 

Schedule I

SCHEDULE II – Addresses for Notices

NewCo Group

BRW Aviation LLC

1209 Orange Street

Wilmington, DE 19801

Attn.: Mrs. Marcela Quental and Mr. Guilherme Pinheiro

Email: marcela.quental@synergygroupcorp.com and guilherme.pinheiro@avianca.com.br

with a copy (which shall not constitute notice) to:

Rua Profa. Heloísa Carneiro, 21

Jardim Aeroporto, Postal Code 04630-050

São Paulo – SP, Brazil

Attn.: Mrs. Marcela Quental and Mr. Guilherme Pinheiro

Telephone: +55 11 3797 5033

Email: marcela.quental@synergygroupcorp.com and guilherme.pinheiro@avianca.com.br

with a copy (which shall not constitute notice) to:

Tauil & Chequer Advogados Associados a Mayer Brown LLP

Av. Presidente Juscelino Kubitschek, 1,455, 5th, 6th and 7th floors

São Paulo, SP, Brazil

Attn.: Mr. Carlos Motta

Email: cmotta@mayerbrown.com

Mayer Brown LLP

71 South Wacker Drive

Chicago, Illinois

Attn.: Mr. Daniel Whitmore

Email: dwhitmore@mayerbrown.com

Kingsland Group

Kingsland Holdings Limited

c/o The Winterbotham Trust Company Limited

Winterbotham Place

Malborough and Queen Streets

Nassau, Commonwealth of the Bahamas

Attn: Rodrigo Salcedo, José Gurdian, Joaquin Palomo, Roberto Kriete

Email: rsalcedo@caobacapital.com, jgurdian@caobacapital.com, joaquin.palomo@aeromar.com.sv, rkriete@mroholdings.com

 

Schedule II

with a copy (which shall not constitute notice) to:

Cadwalader, Wickersham & Taft LLP

200 Liberty Street

New York, NY 10281

Attn: Richard Brand and Andrew Alin

Email: Richard.Brand@cwt.com and Andrew.Alin@cwt.com

Avianca Holdings S.A.

Avianca Holdings, S.A.

Avenida Calle 26 No. 59-15 Edificio Administrativo Avianca,

Bogotá – Colombia

Attn: Renato Covelo, General Counsel

Email: renato.covelo@avianca.com

with a copy (which shall not constitute notice) to:

Simpson Thacher & Bartlett LLP

425 Lexington Avenue

New York, NY 10017

Attn: David Williams

Email: dwilliams@stblaw.com

United:

United Airlines, Inc.

233 South Wacker Drive

Chicago, IL 60606

Attn: Senior Vice President – Alliances

Email: john.gebo@united.com

with a copy (which shall not constitute notice) to:

Sidley Austin LLP

1000 Louisiana Street, Suite 6000

Houston, TX 77002

Attn: Kevin Lewis

Email: klewis@sidley.com

 

Schedule II

SCHEDULE III – Executive Committee Compensation

The Executive Committee members shall be entitled to the same compensation paid to any other Directors plus US$50,000 a year. Notwithstanding anything in this Agreement to the contrary, for so long as the duties and obligations of the Executive Committee are suspended pursuant to Section  7.21 of this Agreement, the Executive Committee members shall not be entitled to any compensation that is different from the compensation paid to any other Directors.

 

Schedule III

EXHIBIT A

FORM OF ACCESSION AGREEMENT

The undersigned is executing and delivering this Accession Agreement pursuant to the Amended Restated Joint Action Agreement by and among Avianca Holdings S.A. (the “ Company ”), Kingsland Holdings Limited, [●] and the other shareholders of the Company dated as of November 29, 2018 (as amended, supplemented or otherwise modified in accordance with the terms thereof, the “ Joint Action Agreement ”). Capitalized terms used but not defined in this Accession Agreement shall have the respective meanings ascribed to them in the Joint Action Agreement.

By executing and delivering this Accession Agreement to the Joint Action Agreement, the undersigned hereby agrees to become a party to, to be bound by, and to comply with the provisions of the Joint Action Agreement as a Shareholder. In connection therewith, effective as of the date hereof the undersigned hereby makes the representations and warranties contained in the Joint Action Agreement. The undersigned hereby irrevocably: (i) agrees that all rights under the Joint Action Agreement exercisable by the [Kingsland Group] [NewCo Group] [United Group] or any member thereof (including the undersigned) shall be exercised solely by [Kingsland] [NewCo] [United] on behalf of all members of the [Kingsland Group] [NewCo Group] [United Group], (ii) appoints [Kingsland] [NewCo] [United Group] as its attorney-in-fact and agent in connection with all transactions contemplated by the Joint Action Agreement, such power to be irrevocable and coupled with an interest and not affected by the death, incapacity, illness or other inability to act of the undersigned, (iii) agrees [Kingsland] [NewCo] [United] shall have the power and authority on behalf of each member of the [Kingsland Group] [NewCo Group] [United Group] (including the undersigned) to give any and all notices, consents, approvals or waivers, and to make or agree to make any and all amendments or modifications to the Joint Action Agreement deemed by [Kingsland] [NewCo] [United] in its sole discretion to be necessary or appropriate and (iv) agrees to bind itself to the [Kingsland Group] [NewCo Group] [United Group] in all respects under the Joint Action Agreement.

Accordingly, the undersigned has executed and delivered this Accession Agreement as of the                     day of                     , 2          .

 

 

Exhibit A

EXHIBIT B

100% JAA

AMENDMENT TO

AMENDED AND RESTATED JOINT ACTION AGREEMENT

OF

AVIANCA HOLDINGS S.A.

Capitalized terms used herein but not defined shall have the meanings ascribed to them in the JAA (as defined below).

RECITALS

WHEREAS , on [●], 2018, the Company, Kingsland, NewCo, United and solely for purposes of Section  4.04 thereof, Synergy Aerospace Corp., a corporation organized under the laws of the Republic of Panama, entered into that certain Amended and Restated Joint Action Agreement (the “ JAA ”);

WHEREAS , NewCo has delivered a 100% Payment Certification; and

WHEREAS , pursuant to Section  7.21(b) of the JAA, United or NewCo has delivered a 100% Notice to the other Parties.

AGREEMENT

NOW THEREFORE , in consideration of the premises and of the mutual promises, representations, warranties, covenants, conditions and agreements contained herein and in the JAA, and for other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1.1.     Amendments .

1.1.1.     Deleted Definitions . The definitions of “Executive Committee” and “Consensus Directors” are hereby deleted in their entirety.

1.1.2.     Size and Composition of Board .

1.1.2.1.     Section 3.03(a)(i) of the JAA is hereby amended and restated in its entirety as follows:

“(i)    A majority of the Directors serving on the Board at any time shall consist of individuals who qualify as “independent” under the rules and regulations of the NYSE (each, an “ Independent Director ”). Each of the NewCo Group, the Kingsland Group and the United Group shall be entitled to appoint a number of such Independent Directors proportional to its ownership of Common Shares in relation to the other Shareholder Groups, equal to the product (rounded up or down to the nearest whole number) of: (A) the total number of Independent Directors, multiplied by (B) a fraction, the numerator of which is the aggregate number of Common Shares owned by such Shareholder Group and the denominator of which is the total number of Common Shares then owned by the NewCo Group, the Kingsland Group and the United Group.”

 

Exhibit B

1.1.2.2.     Section 3.03(e) of the JAA is hereby amended and restated in its entirety as follows:

“(e)    If a majority of the Independent Directors determine that (i) it is in the best interests of the Company to appoint to the Board, in addition to the Directors appointed by the NewCo Group, the Kingsland Group and the United Group, as applicable, pursuant to clauses  (i) , (ii) and (iii)  of Section  3.03(a) , an individual to represent the interests of a significant holder or group of related holders of Capital Stock (other than the NewCo Group, the Kingsland Group and the United Group, as applicable), or (ii) the Company is required by Law to appoint to the Board, in addition to the Directors appointed by the NewCo Group, the Kingsland Group and the United Group, as applicable, pursuant to clauses  (i) , (ii) and (iii)  of Section  3.03(a) any other individual; then for so long as the majority of the Independent Directors determine that the Company should or must appoint such individual (an individual to be appointed pursuant to this Section  3.03(e) is referred to herein as an “ Additional Director ”), (A) the size of the Board shall be increased to accommodate such Additional Director, (B) the additional Board seat(s) created by the increase in the size of the Board shall be filled only by Additional Director(s), (C) all Directors other than any Additional Directors shall continue to be nominated and appointed pursuant to clauses  (i) , (ii) and (iii)  of Section  3.03(a) and (D) any Additional Director shall qualify as an Independent Director.”

1.1.2.3.     Section 3.03(f) and Section  3.03(g) of the JAA are hereby deleted in in their entirety.

1.1.3.     Board Meetings .

1.1.3.1.     Section 3.04(a) and Section  3.04(b) of the JAA are hereby amended and restated in in their entirety as follows:

“(a)    The Board shall meet no less frequently than quarterly (or other frequency as determined by the Board in its sole discretion), at such place and time as shall be determined by Majority Vote. Special meetings of the Board, to be held at the offices of the Company (or such other place as shall be agreed by Majority Vote), shall be called at the direction of the CEO or one or more Directors, and for reasonable cause shown (which includes any meeting called by a Director to review any determination made by the Company pursuant to this Agreement), upon not less than five (5) Business Days’ notice given by or one or more Directors, the CEO, the chairman of the Board or the Secretary of the Company (which officers shall give such notice if properly directed to do so as aforesaid) to each Director. Emergency meetings of the Board may be held at the offices of the Company (or such other place as shall be agreed by Majority Vote) upon not less than one (1) Business Day’s telephone notice to each Director specifying in reasonable detail the nature of such emergency (to be confirmed by written notice to each Director including an agenda specifying in reasonable detail the matters to be discussed at the

 

Exhibit B

applicable Board meeting) by any Director, the CEO, the chairman of the Board or the Secretary of the Company. The matters addressed at any meeting may only include those expressly mentioned in the call notice and included in the agenda, unless otherwise agreed by all the Directors present at such meeting (which agreement may be obtained at the relevant meeting).

(b)    With respect to regular Board meetings, not later than five (5) Business Days before each such meeting, the Secretary of the Company shall deliver to each Director, together with the notice of each such meeting, an agenda specifying in reasonable detail the matters to be discussed at the applicable Board meeting. Any Director that wishes to have any additional matter discussed at any such meeting shall give the Secretary of the Company and each other Director not later than two Business Days prior to any such meeting, notice of each matter it so wishes to discuss.”

1.1.4.     Vacancies . Section 3.06(b) of the JAA is hereby amended and restated in its entirety as follows:

“(b)    In the event a vacancy occurs on the Board as a result of the retirement, removal, resignation or death of any Director , the Shareholder Group that initially appointed such Director shall appoint, at its sole discretion, a new person to replace such Director. The Shareholders agree to vote their respective Common Shares for the election of any person designated in accordance with this Section  3.06(b) to fill a vacancy on the Board. Any Director elected pursuant to this Section  3.06(b) shall serve until the next annual election of Directors.”

1.1.5.     Officers . Section  3.08(c) of the JAA is hereby amended and restated in its entirety as follows:

“(c)    The Secretary of the Company shall be identified and recommended by the CEO. As promptly as practicable following the recommendation by the CEO of an individual to serve as Secretary of the Company, the Board shall take all actions as may be necessary pursuant to and in accordance with applicable Law and the Organization Documents of the Company to appoint the Secretary of the Company recommended by the CEO; provided, however , that, if the Board rejects the candidate proposed by the CEO, as applicable, then, the Board shall explain in writing with reasonable detail the rationale for such rejection and request the CEO to recommend another candidate to be appointed as Secretary of the Company, in which case the Board shall promptly, within five Business Days, take all actions as may be necessary pursuant to and in accordance with applicable Law and the Organization Documents of the Company to appoint the Secretary of the Company recommended by the CEO.”

1.1.6.     Special Approval Matters . Section  3.07(a) of the JAA is hereby amended and restated in its entirety as follows:

“(a)    A Majority Vote shall constitute an act of the Board. Notwithstanding the foregoing, but subject to Section  3.3 of the Share Rights Agreement, neither the Company nor any Subsidiary shall take any of the following actions without the approval of each of the Independent Third Party (or United, if United has delivered a United Approval Notice with respect to the rights under this Section  3.07(a) ) and NewCo:

(i)    materially modify, waive or repeal any material provision contained in its Organization Documents, unless required to comply with applicable Law;

 

Exhibit B

(ii)    merge or consolidate the Company or any Material Subsidiary with, or sell, Transfer or otherwise dispose of, all or substantially all of the assets of the Company or any Material Subsidiary, to any Third Party;

(iii)    issue or sell any voting Capital Stock of or other form of voting equity interest (or other security exercisable for or convertible into any voting Capital Stock or other form of voting equity interest) in the Company or any Subsidiary;

(iv)    except as contemplated by the Business Plan and Budget, make any acquisition of assets or securities or other interests in any joint venture, partnership or other Person (A) related to the airline business or activities ancillary or related thereto in each case in an amount greater than (1) US$30.0 million in any single instance or (2) US$75.0 million in the aggregate during any fiscal year, or (B) not related to the airline business or activities ancillary or related thereto;

(v)    except as contemplated by the Business Plan and Budget, make capital expenditures in excess of US$120.0 million in the aggregate during any fiscal year;

(vi)    authorize, adopt, amend or modify the Business Plan and Budget;

(vii)    enter into, modify or supplement any Contract (A) with a Shareholder, Director or an officer of the Company or a Family Member or Affiliate of any of the foregoing, whether for the performance of services or the direct or indirect sale, lease, conveyance, exchange, Transfer or other disposition of goods, property or other assets or the leasing of same or otherwise or (B) pursuant to which a Shareholder, Director or an officer of the Company or a Family Member or Affiliate of any of the foregoing is a direct or indirect third-party beneficiary;

(viii)    loan any funds, enter into any advance purchase arrangement or otherwise extend credit to Shareholder, Director or an officer of the Company or a Family Member or an Affiliate of the foregoing;

(ix)    terminate any Joint Business Agreement, except (A) as a result of a breach or default thereunder by United or any of its Affiliates giving rise to the Company’s right to such termination, (B) when such termination is required, in the written opinion of the Company’s outside legal counsel, in accordance with applicable Laws to comply with an order by a Governmental Authority and such order cannot be appealed by the parties to such Joint Business Agreement or complied with by the parties to such Joint Business Agreement using reasonable commercial efforts in a manner that does not require termination of such Joint Business Agreement, as applicable, (C) in accordance with its terms, effective no earlier than the expiration of the Initial Term (as defined in the Primary JBA), or (D) when such termination is made jointly by United and the Company;

 

Exhibit B

(x)    any action or omission which would cause the Company to breach, or would constitute a default under, a Joint Business Agreement;

(xi)    commence any bankruptcy or insolvency proceeding of the Company and/or any of its Material Subsidiaries; and

(xii)    dissolve or liquidate, or agree to dissolve or liquidate.”

1.1.7.     Independent Directors Approval Matters . Section  3.07(b) of the JAA is hereby amended and restated in its entirety as follows:

“(b)    Neither the Company nor any Subsidiary shall take any of the following actions without both a Majority Vote and the approval of a majority of the Independent Directors:

(i)    (A) acquire, repurchase or redeem any Capital Stock or other equity interest (or other security exercisable for or convertible into any Capital Stock or other equity interest) in the Company or any Subsidiary or (B) issue or sell any non-voting Capital Stock of or other non-voting equity interest (or other form of security exercisable for or convertible into any non-voting Capital Stock or other form of non-voting equity interest) in the Company or any Subsidiary;

(ii)    unless required by Law or a change in IFRS make any material change in accounting methods (other than (x) a change permitted by IFRS and recommended in writing by the Company’s external auditors or (y) a change recommended by management and unanimously approved by the audit committee of the Board);

(iii)    execute a settlement agreement or confess a judgment, the result of which would be to cause the Company to pay over US$5.0 million to a Third Party;

(iv)    commence any litigation for an amount in excess of US$5.0 million;

(v)    except as contemplated by the Business Plan and Budget, incur indebtedness for borrowed money (other than working capital debt incurred in the ordinary course of business), involving an aggregate annual amount greater than ten percent (10%) of the amount budgeted therefor in the Business Plan and Budget;

(vi)    adopt or amend any stock option plan or other equity incentive plan, or implement any methodology or structure (including compensation ranges) for determining the compensation of the Senior Management and the vice presidents of the Company;

(vii)    select or replace its independent auditors;

(viii)    except as contemplated by the Business Plan and Budget, enter into any material Contract outside the ordinary course of business (including the giving of any guaranty or indemnity) or of any long-term nature, in each case involving an aggregate annual payment greater than 0.3% of consolidated gross revenues of the Company for the most recent four consecutive fiscal quarters;

 

Exhibit B

(ix)    modify the Dividend Policy;

(x)    increase or decrease the size of the Board (other than an increase approved by a majority of the Independent Directors pursuant to Section  3.03(c) );

(xi)    change the jurisdiction of organization of the Company; and

(xii)    terminate or relinquish any material governmental license, permit or concession obtained or held by the Company or any of its Material Subsidiaries.”

1.1.8.     Schedule  III . Schedule III of the JAA is hereby deleted in its entirety.

1.2.     Further Assurances . The Parties agree that from time to time after the date hereof, they will promptly execute and deliver such further documents and take such further actions, as may be reasonably necessary to carry out the purpose and intent of this Amendment.

1.3.     Acknowledgement . The Parties agree that this Amendment complies with the requirements to amend the JAA, as set forth in Section  7.13(a) of the JAA. The JAA, as amended herein, is ratified and confirmed, and all other terms and conditions of the JAA not modified or supplemented by this Amendment shall remain in full force and effect. All references to the JAA shall hereafter be considered to be references to the JAA as modified by this Amendment.

1.4.     Counterparts . This Amendment may be executed and delivered (including by facsimile transmission or by electronic mail in “portable document format” (“.pdf”) form) in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed and delivered shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. Copies of executed counterparts transmitted by telecopy, electronic mail or other electronic transmission service shall be considered original executed counterparts for purposes of this Section  4 .

1.5.     Governing Law . This Amendment shall be governed by, and construed in accordance with, the laws of the State of New York.

1.6.     Headings . The headings in this Amendment are included for convenience and identification only and are in no way intended to describe, interpret, define or limit the scope, extent or intent of this Amendment or any provision hereof.

[End of the Document]

 

Exhibit B

Exhibit 2.2

 

 

 

S HARE R IGHTS A GREEMENT

REGARDING

A VIANCA H OLDINGS S.A.

D ATED AS OF N OVEMBER  29, 2018

 

 

 

T ABLE OF C ONTENTS

 

Article 1    DEFINITIONS; RULES OF CONSTRUCTION		2
Section 1.1        Definitions		2
Section 1.2        Rules of Construction		15
Article 2    TRANSFER OF SHARES		16
Section 2.1        Restrictions on the Transfers of Shares		16
Section 2.2        Tag Along Rights		18
Section 2.3        Drag Along Rights		21
Section 2.4        United Right of First Refusal		23
Section 2.5        Right of First Offer on NewCo Shares		29
Section 2.6        Right of First Offer on Kingsland Shares		31
Section 2.7        United’s Call Right on NewCo’s Shares		33
Section 2.8        United’s Call Right on Kingsland’s Shares		34
Section 2.9        NewCo Purchase Rights		36
Article 3    RIGHTS AND DUTIES OF THE PARTIES		39
Section 3.1        Voting Restrictions		39
Section 3.2        Effect Agreement; Legends		39
Section 3.3        JAA Matters		39
Section 3.4        Conversion Restrictions		45
Section 3.5        Intentionally Omitted		46
Section 3.6        Compliance with JBA Integrity Provisions		46
Section 3.7        Confidentiality		46
Section 3.8        Press Releases		47
Section 3.9        Independent Third Party		47
Section 3.10      Anti-Money Laundering Laws; Anti-Corruption Laws		50
Article 4    REPRESENTATIONS AND WARRANTIES		50
Section 4.1        Organization and Good Standing		50
Section 4.2        Authority		50
Section 4.3        Enforceability		51
Section 4.4        No Violations		51
Section 4.5        Compliance with Laws		51
Section 4.6        Brokerage or Finders Fees		51
Article 5    TERM		51
Section 5.1        Term		51
Article 6    MISCELLANEOUS		52
Section 6.1        Indemnification		52
Section 6.2        Further Assurances		54
Section 6.3        Entire Agreement		54
Section 6.4        Conflicting Provisions		54
Section 6.5        Successors and Assigns		54

Section 6.6        Assignment of Rights		54
Section 6.7        Waivers; Cumulative Remedies		54
Section 6.8        Amendments		55
Section 6.9        Notices		55
Section 6.10      GOVERNING LAW; JURISDICTION, ETC		56
Section 6.11      Severability		58
Section 6.12      Execution in Counterparts		59
Section 6.13      Electronic Transmissions		59
Section 6.14      Third Party Beneficiaries		59
Section 6.15      Specific Performance		59
Section 6.16      Shareholders Agreement		60

EXHIBITS

 

Exhibit A		–		Instrument of Transfer
Exhibit B		–		Form of Sale Notice
Exhibit C		–		Form of Tag-Along Notice
Exhibit D		–		Form of Drag Along Notice
Exhibit E		–		Form of NewCo Purchase Offer
Exhibit F		–		United NewCo Notice of Exercise
Exhibit G		–		Form of NewCo Seller’s Certificate
Exhibit H		–		Form of United NewCo Matching Notice
Exhibit I		–		Form of Kingsland Purchase Offer
Exhibit J		–		Form of United Kingsland Notice of Exercise
Exhibit K		–		Form of Second ROFR Notice of Exercise
Exhibit L		–		Form of Kingsland Seller’s Certificate
Exhibit M		–		Form of United Kingsland Matching Notice
Exhibit N		–		Form of United NewCo ROFO Exercise Notice
Exhibit O		–		Form of United Kingsland ROFO Exercise Notice
Exhibit P		–		Form of NewCo Kingsland ROFO Exercise Notice
Exhibit Q		–		Form of NewCo Call Notice
Exhibit R		–		Form of Kingsland Call Notice
Exhibit S		–		Form of United Purchase Offer
Exhibit T		–		Form of NewCo Notice of Exercise
Exhibit U		–		Form of United Seller’s Certificate
Exhibit V		–		Form of NewCo Matching Notice
Exhibit W		–		Form of NewCo Buy-Out Offer
Exhibit X		–		Form of United Buy-Out Offer
Exhibit Y		–		Form of United Approval Notice
Exhibit Z		–		Form of Put Shares Buy-Out Notice

S HARE R IGHTS A GREEMENT

This Share Rights Agreement (this “ Agreement ”) is made and entered into effective as of November 29, 2018 (the “ Effective Date ”), by and among Avianca Holdings S.A., a corporation ( sociedad anónima ) organized under the Laws of the Republic of Panama (the “ Company ”), Kingsland Holdings Limited, a company organized under the Laws of the Commonwealth of the Bahamas (“ Kingsland ”), BRW Aviation LLC, a Delaware limited liability company (“ NewCo ”), and United Airlines, Inc., a Delaware corporation (together with its Affiliates, “ United ”). The Company, Kingsland, NewCo and United are collectively referred to herein as “ Parties ” and individually as a “ Party .”

R ECITALS

WHEREAS, NewCo owns approximately 78.1%, and Kingsland owns approximately 21.9%, of the Company’s common shares ( acciones ordinarias ), par value $0.125 per common share (the “ Common Shares ”);

WHEREAS, on the date hereof, the Company, Kingsland, NewCo, United and Synergy Aerospace Corp., a corporation organized under the Laws of the Republic of Panama and an Affiliate of NewCo (“ Synergy ”), have agreed to amend and restate that certain Joint Action Agreement, dated as of September 11, 2013, as amended on March 24, 2015 (as amended and restated on the date hereof, the “ JAA ”);

WHEREAS, on November 29, 2018, United, Wilmington Trust, National Association as collateral agent (the “ Collateral Agent ”), Wilmington Trust, National Association as administrative agent, NewCo and BRW Aviation Holding, LLC entered into that certain Term Loan Agreement (the “ NewCo Loan Agreement ”), pursuant to which, among other things, United has agreed to loan to NewCo certain funds (the “ NewCo Loan ”);

WHEREAS, Synergy has contributed and transferred all of its Shares (as defined below) to NewCo and NewCo has executed an Accession Agreement (as defined in the JAA) and has become a party of the JAA;

WHEREAS, as conditions precedent to the funding of the NewCo Loan, among other matters, (i) the Company, Kingsland, United and NewCo have amended and restated the JAA; (ii) Kingsland and United have entered into that certain Put Option Agreement, dated the date hereof (the “ Put Option Agreement ”); (iii) NewCo, Kingsland and United have entered into that certain Cooperation Agreement, dated as of the date hereof (the “ Cooperation Agreement ”); (iv) the Company, United, Kingsland, NewCo and Synergy have entered into that certain Second Amended and Restated Registration Rights Agreement (the “ Registration Rights Agreement ”); and (v) the Parties have agreed to enter this Agreement; and

WHEREAS, the Parties deem it in their best interests to agree to certain rights and obligations to govern the relationship among the Parties with regards to their rights to the Shares, as set forth in this Agreement.

 

1

A GREEMENT

NOW, THEREFORE, for and in consideration of the premises and of the mutual terms, covenants and agreements contained herein, and of the mutual benefits to be derived therefrom, the receipt and sufficiency of which are hereby acknowledged by the Parties, the Parties do hereby covenant and agree as follows:

ARTICLE 1

DEFINITIONS; RULES OF CONSTRUCTION

Section 1.1     Definitions . The terms set forth below shall have the meanings ascribed to them in this Section  1.1 or in the part of this Agreement referred to below.

“ 100% JAA ” has the meaning set forth in the JAA.

“ Adjustment Event ” has the meaning set forth in the Put Option Agreement.

“ Affiliate ” means, with respect to a Person, any other Person Controlling, Controlled by or under common Control with such Person. For the avoidance of doubt, for all purposes under this Agreement, none of the Company or any of its Subsidiaries shall be considered an Affiliate of Kingsland, and Kingsland shall not be considered an Affiliate of the Company or any of its Subsidiaries.

“ Agreement ” has the meaning set forth in the preamble.

“ Alternate Call Price ” has the meaning set forth in Section  2.7(a) .

“ Anti-Corruption Laws ” means any and all laws, judgments, orders, executive orders, decrees, ordinances, rules, regulations, statutes, case law or treaties applicable to Kingsland or its Affiliates, related to anti-bribery or anti-corruption, including any applicable provision of the FCPA and, to the extent applicable to Kingsland and its Affiliates, the UK Bribery Act 2010, Brazilian Anti-Corruption Laws, the Criminal Code (Law 599 of 2000), Laws 80 of 1993, 734 of 2002, 1474 of 2011, 1712 of 2014 and 1778 of 2016 of the Republic of Colombia, and the United Nations Convention against Corruption, adopted by the United Nations General Assembly in Mérida in 2003 and ratified by Colombia by Law 970 of 2005, and any regulations related thereto and other similar anti-corruption legislation in other jurisdictions.

“ Anti-Money Laundering Laws ” means any and all laws, judgments, orders, executive orders, decrees, ordinances, rules, regulations, statutes, case law or treaties applicable to Kingsland or its Affiliates, related to terrorism financing or money laundering including, any applicable provision of Title III of the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act (USA PATRIOT Act) of 2001 (Title III of Pub. L. 107-56) and The Currency and Foreign Transactions Reporting Act (also known as the “Bank Secrecy Act”, 31 U.S.C. §§ 5311-5330 and 12 U.S.C. §§ 1818(s), 1820(b) and 1951-1959), Brazilian Anti-Money Laundering Laws, the Criminal Code (Law 599 of 200), Laws 526 of 1999, 793 of 2002, 1121 of 2006 1708 of 2014 and 1762 of 2015 of the Republic of Colombia, the Convention on Laundering, Search, Seizure and Confiscation of the Proceeds from Crime, signed in Strasbourg on November 8, 1990 and ratified by Colombia by Law 1017 of 2006, the

 

2

International Convention for the Suppression of the Financing of Terrorism adopted by the United Nations General Assembly on December 9, 1999 and ratified by Colombia through Law 808 of 2003, the Inter-American Convention against Terrorism, signed in Bridgetown, Barbados on June 3, 2002 by the Organization of American States and ratified by Colombia by Law 1108 of 2006, and Law 23 of 2015 issued by the Republic of Panama.

“ AVH ADS ” means the Company’s American Depositary Shares (as evidenced by American Depositary Receipts) listed on the New York Stock Exchange, each currently representing eight Preferred Shares as of the date hereof.

“ AVH Call Option Agreement ” means that certain AVH Call Option Agreement, dated as of the date hereof, by and between NewCo and United.

“ AVH Pledge Agreement ” means that certain Pledge Agreement, dated as of the date hereof, by and between NewCo and the Collateral Agent with respect to NewCo’s Shares.

“ AVH Stock Appreciation Rights Agreement ” means that certain AVH Stock Appreciation Rights Agreement, dated as of the date hereof, by and between NewCo and United.

“ AVH United NDA ” means that certain Third Amended and Restated Confidentiality Agreement, dated as of March 2, 2017, by and between United and the Company.

“ AVH VWAP ” means, with respect to an AVH ADS on any date of determination, the volume-weighted average price of each AVH ADS (weighted by the total daily trading volume for that day, as quoted on the electronic financial news service of Bloomberg L.P. or, if such quote is not then available, then on the electronic financial news service of Thomson Reuters) on the New York Stock Exchange for the 30 trading days prior to the applicable date.

“ Beneficial Owner ” or “ Beneficially Own ” (including, with correlative meaning, the term “ Beneficial Ownership ”) has the meaning given such terms in Rule 13d-3 under the United States Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

“ Bona Fide Offer ” has the meaning set forth in Section  2.4(a)(i) .

“ Business Day ” means any day other than Saturday, Sunday, a day which is a legal holiday in the City of New York, United States, Nassau, the Bahamas, Panama City, Panama or Bogota, Colombia or a day on which commercial banks in the City of New York, United States, Nassau, the Bahamas, Panama City, Panama or Bogota, Colombia are authorized or required by Law to close.

“ BVC ” means the Colombian Stock Exchange ( Bolsa de Valores de Colombia ).

“ Call Price ” means, as of the date of the delivery of a NewCo Call Notice or Kingsland Call Notice, as applicable, an amount equal to (a) the AVH VWAP; divided by (b) eight; and multiplied by (c) the number of Shares owned by NewCo or Kingsland, as applicable; provided , however , that (i) if, for any reason, the AVH VWAP is unavailable whether due to a market disruption, discontinuation of AVH ADS or otherwise the Call Price shall be an amount equal to

 

3

(x), the volume weighted average price of the Preferred Shares on the BVC for the 30 trading days prior to the applicable date, determined in a manner consistent with the definition of AVH VWAP; multiplied by (y) the number of Shares owned by NewCo or Kingsland, as applicable; and (ii) if, for any reason, the volume weighted average price of the Preferred Shares on the BVC is unavailable whether due to a market disruption, discontinuation of the Preferred Shares or otherwise, the Call Price for all of the Shares owned by NewCo or Kingsland, as applicable, shall be determined by the Independent Accountant.

“ Collateral Agent ” has the meaning set forth in the recitals.

“ Common Shares ” has the meaning set forth in the recitals.

“ Company ” has the meaning set forth in the preamble.

“ Company Charter ” means the pacto social of the Company (or equivalent or comparable constitutive documents with respect to any U.S. jurisdiction, including a certificate or articles of incorporation and bylaws), as amended from time to time.

“ Competitor ” means any airline based in, or whose business includes the transportation of passengers and/or cargo to, from or within any one or more of Mexico, Central America, South America and/or the Caribbean other than helicopter or private air taxi services or other nonscheduled passenger charter services using aircraft having less than 25 seats.

“ Confidential Informatio n ” has the meaning set forth in Section  3.7 .

“ Contract ” means any legally binding arrangement, whether written or oral, including agreements, contracts, indentures, debentures, notes, bonds, loans, collective bargaining agreements, leases, mortgages, franchises, license agreements, purchase orders, bids, letters of credit, memoranda of understanding, commitments or letter of credits, in each case, including any amendments or modifications thereto.

“ Control ” means, with respect to a Person, the possession of the power, directly or indirectly, to direct or cause the direction of the management or policies of such Person, whether through ownership of voting securities, by Contract or otherwise, including, without limitation, the direct or indirect ownership of securities having the power, directly or indirectly, to elect or appoint the majority of the board of directors or similar body governing the affairs of such Person, and “ Controlling ” and “ Controlled by ” shall be interpreted accordingly.

“ Cooperation Agreement ” has the meaning set forth in the recitals.

“ Cooperation Payment ” has the meaning set forth in the Cooperation Agreement.

“ Custodian ” means Wilmington Trust, National Association.

“ Delayed ROFO Sale ” has the meaning set forth in Section  2.6(b) .

“ Delayed ROFR Sale ” has the meaning set forth in Section  2.4(b)(ii)(A) .

 

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“ Delegated Rights ” means (a) all of the rights to vote Kingsland’s Shares, whether arising under the JAA or the Company Charter or applicable Law, and, to exercise the right to approve (or withhold approval of) Special Approval Matters under Section 3.07 of the JAA, and to provide any other consent or waiver under the JAA or the Organization Documents or the Company Charter or to exercise any other rights afforded to Kingsland or shareholders generally under the JAA and the Company Charter (including with regard to any amendment to the JAA and the Organization Documents including the Company Charter), in each case, other than (i) the Kingsland Director Rights, (ii) Kingsland’s rights under Section 4.04 of the JAA, (iii) all statutory rights afforded to Kingsland as a shareholder of AVH under Panamanian law pursuant to Articles 418, 420, 425 and 444 of the Code of Commerce of the Republic of Panama (including provisions consolidating, amending, succeeding or replacing such Articles) and any additional statutory rights afforded to shareholders under Panamanian law after the date hereof not inconsistent with the rights of the Independent Third Party or United pursuant to the terms of the this Agreement, the JAA and the Organization Documents including the Company Charter and (iv) any such consent, waiver or amendment that increases the liabilities or obligations or reduces the rights of Kingsland under the JAA or the Organization Documents, including the Company Charter, in each case in a manner that is disproportionate to Kingsland’s equity ownership of the Company, or that creates a direct financial obligation of Kingsland to which Kingsland has not agreed in writing, provided that Kingsland shall provide to the Independent Third Party (or, following the delivery by United of a United Approval Notice, to United) at least three Business Day’s advance written notice of its intention to vote its Shares pursuant to any of clauses (i) through (iv) above; and (b) all of the rights afforded to the Independent Third Party (or United, if United delivers a United Approval Notice with respect to any such rights) pursuant to this Agreement, the JAA and the Company Charter.

“ Disability ” means, with respect to any Person, that such Person is unable to perform substantially all of his or her responsibilities and duties hereunder because of illness, injury, accident or condition of either a physical or psychological nature, for 10 consecutive calendar days and remains so unable at the end of such 10-day period.

“ Disapproval Notice ” has the meaning set forth in the JAA.

“ Drag-Along Notice ” has the meaning set forth in Section  2.3(c) .

“ Drag-Along Transferee ” has the meaning set forth in Section  2.3(a) .

“ Effective Date ” has the meaning set forth in the preamble.

“ Entity ” means any corporation, limited liability company, general partnership, limited partnership, venture, trust, business trust, unincorporated association, estate or other entity.

“ Event of Default ” has the meaning set forth in the NewCo Loan Agreement.

“ Exercise ” or “ Exercised ” has the meaning set forth in the Put Option Agreement.

“ Exit Sale ” has the meaning set forth in Section  2.3(a) .

“ Fair Market Price Per Share ” means, as of any date of determination, a price per Share, calculated as (a) the AVH VWAP, divided by (b) eight; provided , however , that (i) if, for any reason, the AVH VWAP is unavailable whether due to a market disruption, discontinuation of AVH ADS or otherwise, the Fair Market Price Per Share shall be an amount equal to the volume weighted average price of the Preferred Shares on the BVC for the 30 trading days prior to the applicable date, determined in a manner consistent with the definition of AVH VWAP and (ii) if, for any reason, the volume weighted average price of the Preferred Shares on the BVC is unavailable whether due to a market disruption, discontinuation of the Preferred Shares or otherwise, the Fair Market Price Per Share shall be determined by the Independent Accountant.

 

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“ Fundamental JAA Approval Rights ” means any consent, veto, approval, waiver or other rights that (a) each of the Independent Third Party (or United, if United delivers a United Approval Notice with respect to any such rights) and NewCo has pursuant to Sections 3.07(a)(x)-(xiii) of the JAA and Article 11(A)(x)-(xiii) of the Company Charter and (b) each of Kingsland, NewCo and United has pursuant to Section 4.02 of the JAA.

“ Governmental Authority ” means for any country, such country and its government and any national, federal, state, provincial, territory, departmental, county, municipal, local ministry, department, political subdivision, commission, court or tribunal, or agency or instrumentality thereof (including any legislative house or judiciary), as well as any government-owned or controlled corporation or other enterprise.

“ IFRS ” means international accounting standards within the meaning of IAS Regulation 1606/2002 as set forth from time to time in the statements and pronouncements of the International Accounting Standards Board, which are applicable to the circumstances as of the date of determination.

“ Incapacity ” means, with respect to any Person, a final non-appealable judgment by a court or other governmental authority of competent jurisdiction that such Person is unable to manage his or her own affairs.

“ Independent Accountant ” means Deloitte LLP or, if Deloitte LLP is unable or unwilling to serve, the parties shall appoint in good faith by mutual agreement the office of an impartial internationally recognized firm of independent certified public accountants who have demonstrated expertise in the aviation industry other than the accountants of any of the Parties or their Affiliates.

“ Independent Third Party ” has the meaning set forth in Section  3.9(a) .

“ Independent Third Party Agreement ” has the meaning set forth in Section  3.9(c) .

“ JAA ” has the meaning set forth in the recitals.

“ JAA Approval Rights ” means any consent, veto, approval, waiver or other rights that each of the Independent Third Party (or United, if United delivers a United Approval Notice with respect to any such rights) and NewCo has pursuant to Sections 3.07(a) and 4.02 of the JAA and Article 11(A) of the Company Charter.

“ JAA Veto Rights ” means the right to issue a Disapproval Notice with respect to a Special Approval Matter set forth in Section 3.07(a) of the JAA and Article 11(A) of the Company Charter.

“ Joint Business Agreements ” has the meaning set forth in the NewCo Loan Agreement.

“ Judgment ” means any and all judgments, orders, directives, injunctions, decrees or awards of any Governmental Authority or arbitral body.

 

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“ Key Person Event ” has the meaning set forth in the NewCo Loan Agreement.

“ Kingsland ” has the meaning set forth in the preamble.

“ Kingsland Block Trade ” has the meaning set forth in Section  2.6(a) .

“ Kingsland Call Notice ” has the meaning set forth in Section  2.8(a) .

“ Kingsland Director Rights ” has the meaning set forth in the JAA.

“ Kingsland Financing Documents ” means any financing arrangements entered into by Kingsland with respect to Kingsland’s Shares, including the Kingsland Loan Agreement (as defined in the Put Option Agreement) and the Standby Letter of Credit (as defined in the Put Option Agreement), and any other agreement, instrument or certificate executed by Kingsland as required by the Kingsland Loan Agreement including any swap agreements.

“ Kingsland Group ” has the meaning set forth in the JAA.

“ Kingsland Indemnified Matters ” has the meaning set forth in Section  6.1(b) .

“ Kingsland Indemnitees ” has the meaning set forth in Section  6.1(a) .

“ Kingsland JAA Tag Along Rights ” has the meaning set forth in Section  2.4(b)(i) .

“ Kingsland Material Breach ” means a material breach by Kingsland of (a) any of the provisions of Article  2 or Article  3 (excluding Section  3.6 , Section  3.7 and Section  3.8 ) hereof, (b) Sections 3.05, 3.06(b) or 4.02 of the JAA or (c) any Kingsland Financing Documents.

“ Kingsland NDA ” means that certain Non-Disclosure Agreement, dated as of August 11, 2017, by and between United and Kingsland.

“ Kingsland Purchase Offer ” has the meaning set forth in Section  2.4(b)(i) .

“ Kingsland ROFO Offer ” has the meaning set forth in Section  2.6(a) .

“ Kingsland ROFO Price ” has the meaning set forth in Section  2.6(a) .

“ Kingsland ROFO Shares ” has the meaning set forth in Section  2.6(a) .

“ Kingsland ROFO Termination Date ” has the meaning set forth in Section  2.6(c) .

“ Kingsland ROFR Shares ” has the meaning set forth in Section  2.4(b)(i) .

“ Kingsland Seller ” has the meaning set forth in Section  2.4(b)(i) .

“ Laws ” means all applicable statutes, laws, rules, regulations, codes, ordinances, rulings, orders, decisions and awards of Governmental Authorities or permits.

 

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“ Lien ” means any mortgage, pledge ( prenda mercantil ), hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, or preference, priority or other security interest or preferential arrangement in the nature of a security interest of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any easement, right of way or other encumbrance on title to real property, and any financing lease having substantially the same economic effect as any of the foregoing).

“ Majority Shareholder ” has the meaning set forth in Section  2.3(a) .

“ Maximum Tag Amount ” has the meaning set forth in Section  2.2(c)(i) .

“ Minority Shareholders ” has the meaning set forth in Section  2.3(a) .

“ NewCo ” has the meaning set forth in the preamble.

“ NewCo Block Trade ” has the meaning set forth in Section  2.5(a) .

“ NewCo Buy-Out Closing Date ” has the meaning set forth in Section  3.3(a)(iii)(B) .

“ NewCo Buy-Out Offer ” has the meaning set forth in Section  3.3(a)(iii) .

“ NewCo Buy-Out Right ” has the meaning set forth in Section  3.3(a)(iii) .

“ NewCo Call Notice ” has the meaning set forth in Section  2.7(a) .

“ NewCo Group ” has the meaning set forth in the JAA.

“ NewCo Indemnified Matters ” has the meaning set forth in Section  6.1(a) .

“ NewCo Indemnitees ” has the meaning set forth in Section  6.1(b) .

“ NewCo Kingsland ROFO Exercise Closing ” has the meaning set forth in Section  2.6(d)(i) .

“ NewCo Kingsland ROFO Exercise Notice ” has the meaning set forth in Section  2.6(d) .

“ NewCo Loan ” has the meaning set forth in the recitals.

“ NewCo Loan Agreement ” has the meaning set forth in the recitals.

“ NewCo Matching Notice ” has the meaning set forth in Section  2.9(a)(iv) .

“ NewCo Notice of Exercise ” has the meaning set forth in Section  2.9(a)(ii) .

“ NewCo Ownership Threshold Failure ” means, at any time, (a) the NewCo Group owns less than 15% of the then outstanding Common Shares and (b) the United Group owns at least four times the number of Common Shares owned by the NewCo Group; provided that, for purposes of calculating the ownership of the United Group pursuant to clause  (b) above, the United Group will be deemed to own all of the Common Shares of the Company owned of record by the Kingsland Group once Kingsland has Exercised or been deemed to have Exercised the Put Option.

 

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“ NewCo Purchase Offer ” has the meaning set forth in Section  2.4(a)(i) .

“ NewCo Put Shares Buy-Out Right ” has the meaning set forth in Section  3.3(a)(iii)(E) .

“ NewCo ROFO Deposit ” has the meaning set forth in Section  2.6(d) .

“ NewCo ROFO Offer ” has the meaning set forth in Section  2.5(a) .

“ NewCo ROFO Price ” has the meaning set forth in Section  2.5(a) .

“ NewCo ROFO Shares ” has the meaning set forth in Section  2.5(a) .

“ NewCo ROFR Closing ” has the meaning set forth in Section  2.9(a)(ii) .

“ NewCo ROFR Deposit ” has the meaning set forth in Section  2.4(b)(ii)(B)(i) .

“ NewCo ROFR Offer Period ” has the meaning set forth in Section  2.9(a)(ii) .

“ NewCo ROFR Shares ” has the meaning set forth in Section  2.4(a)(i) .

“ NewCo Seller ” has the meaning set forth in Section  2.4(a)(i) .

“ NewCo United ROFO Offer ” has the meaning set forth in Section  2.9(b)(ii) .

“ NewCo United ROFO Period ” has the meaning set forth in Section  2.9(b)(ii) .

“ NewCo United ROFO Price ” has the meaning set forth in Section  2.9(b)(ii) .

“ Non-Permitted Holder ” has the meaning set forth in the JAA.

“ Notices ” has the meaning set forth in Section  6.9 .

“ Obligations ” has the meaning set forth in the NewCo Loan Agreement.

“ Option ” has the meaning set forth in the AVH Call Option Agreement.

“ Option Exercise Payment ” has the meaning set forth in the AVH Call Option Agreement.

“ Optioned AVH Shares ” has the meaning set forth in Section  2.1(c) .

“ Organization Documents ” means, with respect to any Person, its core documents, including (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction, including the pacto social ); (b) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement (or equivalent or comparable constitutive documents with respect to any non-U.S. jurisdiction, including the pacto

 

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social and estatutos under applicable Panamanian Law); and (c) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation, registration or organization of such entity.

“ Party ” or “ Parties ” has the meaning set forth in the preamble.

“ Permitted JBA Termination ” means a termination of any Joint Business Agreement by the Company or any of its Affiliates (a) as a result of a breach or default thereunder by United or any of its Affiliates giving rise to the Company’s right to such termination; (b) when such termination is required, in the written opinion of the Company’s outside legal counsel, in accordance with applicable Laws to comply with an order by a Governmental Authority and such order cannot be appealed by the parties to such Joint Business Agreement or complied with by the parties to such Joint Business Agreement using reasonable commercial efforts in a manner that does not require termination of such Joint Business Agreement, as applicable; (c) in accordance with its terms, effective no earlier than the expiration of the Initial Term (as defined in the Primary JBA); or (d) when such termination is made jointly by United and the Company.

“ Permitted Transferee ” has the meaning set forth in the JAA.

“ Person ” means any natural person, Entity or Governmental Authority.

“ Pledge and Custody Agreement ” means that certain Pledge and Custody Agreement, dated as of the date hereof, by and among United, Kingsland and the Custodian.

“ Preferred Shares ” means the Company’s preferred shares, par value $0.125 per share.

“ Primary JBA ” has the meaning set forth in the NewCo Loan Agreement.

“ Proposed Transferee ” has the meaning set forth in Section  2.2(a) .

“ Put Option ” has the meaning set forth in the Put Option Agreement.

“ Put Option Agreement ” has the meaning set forth in the recitals.

“ Put Option Closing Date ” has the meaning set forth in the Put Option Agreement.

“ Put Shares ” has the meaning set forth in the Put Option Agreement.

“ Put Shares Buyout Notice ” has the meaning set forth in Section  3.3(a)(iii)(E) .

“ Put Shares Buyout Offer ” has the meaning set forth in Section  3.3(a)(iii)(E) .

“ Registration Rights Agreement ” has the meaning set forth in the recitals.

“ Responsible Officer ” means (a) with respect to any Party other than United, the chief executive officer, president or chief financial officer of such Party and solely for purposes of the

 

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delivery of incumbency certificates, the secretary or any assistant secretary of such Party and (b) with respect to United, (i) the chief executive officer, the president, the chief financial officer, any executive vice president, the treasurer, the vice president, chief financial officer – operations, and controller of United and/or UCH, respectively; (ii) any other officer of United and/or UCH (as the case may be) authorized by any of the foregoing persons in writing; and (iii) any officer of any of UCH and its subsidiaries (however such officer’s title may be designated in the future) whose responsibilities include all or a substantial part of the current responsibilities of one or more the foregoing specified officers. Any document delivered hereunder that is signed by a Responsible Officer of a Party shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Party and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Party.

“ Sale Notice ” has the meaning set forth in Section  2.2(b) .

“ Second ROFR Closing ” has the meaning set forth in Section  2.4(b)(ii)(B)(ii) .

“ Second ROFR Notice of Exercise ” has the meaning set forth in Section  2.4(b)(ii)(B)(i) .

“ Share Value Measurement Date ” means, with respect to any Share, the date on which such Share is Transferred to the United Group (including in connection with the exercise of Kingsland’s Put Option, the exercise of United’s Option, the payment in kind by NewCo to United pursuant to Section 2.8 of the NewCo Loan Agreement or Section 2.4(b)(ii) of the AVH Stock Appreciation Rights Agreement or the exercise of United’s rights pursuant to Section  2.4(b)(i), and Section  2.5(b) , as the case may be); provided, however , that in connection with each of a Delayed ROFO Sale, Delayed ROFR Sale and a delay of Share Value Payment and Transfer of Put Shares pursuant to Section 2.2(c) of the Put Option Agreement, the Share Value Measurement Date shall be deemed to be the Put Option Closing Date pursuant to Section 2.2(b)(ii) of the Put Option Agreement.

“ Shareholder ” means those Persons who own Shares as of the Effective Date or who subsequently become owners of Shares but shall not include any Person after it ceases to own Shares.

“ Shares ” means, on any given date, the issued and outstanding Common Shares and Preferred Shares as of such date.

“ Special Approval Matter ” has the meaning set forth in the JAA.

“ Special Approval Request Date ” has the meaning set forth in Section  3.3(a)(ii)(A) .

“ Subsidiary ” means, with respect to a Person, any other Person Controlled by such first Person.

“ SVP Delay Date ” has the meaning set forth in the Put Option Agreement.

“ Synergy ” has the meaning set forth in the recitals.

“ Synergy COC Transaction Notice ” has the meaning set forth in Section  2.4(b)(i) .

 

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“ Synergy United AVH NDA ” means that certain Confidentiality Agreement, dated as of October 24, 2018, by and between Synergy, United and the Company.

“ Tag-along Notice ” has the meaning set forth in Section  2.2(c)(i) .

“ Tag-along Period ” has the meaning set forth in Section  2.2(c)(i) .

“ Tag-along Sale ” has the meaning set forth in Section  2.2(a) .

“ Tag-along Shareholder ” has the meaning set forth in Section  2.2(a) .

“ Third-Party Purchaser ” has the meaning set forth in Section  2.4(a)(i) .

“ Transaction Documents ” means this Agreement, the JAA, the Cooperation Agreement, the AVH Call Option Agreement, the Put Option Agreement, the Joint Business Agreements, the Registration Rights Agreement, as well as any other written agreements, dated as of the date hereof, (a) between United and Kingsland relating to Kingsland’s Shares, including the Upside Sharing Agreement and the Pledge and Custody Agreement, and (b) between United and NewCo or its Affiliates, relating to NewCo’s Shares, including the AVH Stock Appreciation Rights Agreement.

“ Transfer ,” “ Transferred ,” “ Transferring ” means, with respect to a Person, a direct or indirect disposition, sale, assignment, transfer, gift, surrender for cancellation, exchange or pledge, or the direct or indirect grant or transfer of any economic interest, security interest, ownership, derivative interest, voting power or other Lien, including by death, operation of law, judicial decree, a change of Control of such Person, merger or consolidation of such Person into or with any other Person or otherwise, and the term “ Transferability ” shall be interpreted accordingly; provided, however , that a change of Control or merger or consolidation of United shall not be deemed a Transfer for purposes of this Agreement.

“ Transfer Documents ” means, in connection with a Transfer pursuant to Section  2.4(a)(ii) , Section  2.4(b)(ii) , Section  2.4(b)(ii)(B)(ii) , Section  2.5(b) , Section  2.6(b) , Section  2.6(d)(i) , Section  2.7(d) , Section  2.8(d) , Section  2.9(a)(ii) , Section  3.3(a)(iii)(B) and (D) , Section  3.3(a)(v) and Section  3.3(a)(vii)(B) and (D) , (a) a certificate signed by (i) an authorized officer of United (or a United Designee) or (ii) a Responsible Officer of NewCo or Kingsland, as applicable, certifying that it has conveyed good title to the Shares, free and clear of all Liens (other than Liens created by or pursuant to this Agreement or any other Transaction Document); (b) the original certificates representing or evidencing the Shares to be cancelled and the new share certificates representing the new Shares (i) in the name of United (or the United Designee, as applicable) for purposes of Section  2.4(a)(ii) , Section  2.5(b) , Section  2.6(b) , Section  2.7(d) , Section  2.8(d) and Section  3.3(a)(vii)(B) or (ii) in the name of NewCo for purposes of Section  2.4(b)(ii)(B)(ii) , Section  2.6(d)(i) , Section  2.9(a)(ii) and Section  3.3(a)(iii)(B) and (D) ; (c) instruments of transfer or assignment for the certificates evidencing such Shares, substantially in the form attached hereto as Exhibit  A , duly executed by United, a United Designee, NewCo or Kingsland (as applicable) and notarized by a Panamanian public notary ( notario público ) and apostilled; (d) corporate resolutions of United, a United Designee, NewCo or Kingsland (as applicable) authorizing and approving the Transfer of the Shares; and (e) a certificate pursuant to which the Company certifies

 

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that it has duly annotated and recorded the Transfer of the Shares in the Company’s stock registry with a certified copy of the Company’s stock registry evidencing such annotation attached thereto, all in form and substance reasonably satisfactory to United (for purposes of Section  2.4(b)(i) , Section  2.5(b) , Section  2.6(b) , Section  2.7(d) , Section  2.8(d) and Section  3.3(a)(vii)(B) ) or NewCo (for purposes of Section  2.4(b)(ii)(B)(ii) , Section  2.6(d) , Section  2.9(a)(ii) and Section  3.3(a)(iii)(B) and (D) ).

“ UCH ” means United Continental Holdings, Inc.

“ United ” has the meaning set forth in the preamble.

“ United Approval Notice ” has the meaning set forth in Section  3.3(b) .

“ United Blended Share Price ” means, as of any date, the average price per Share held by the United Group, calculated as follows:

(a) the sum of:

(i)    if the United Group owns any Shares as a result of Kingsland’s exercise of the Put Option, the Share Value Payment;

(ii)    if the United Group owns any Shares as a result of United’s exercise of the Option, the Option Exercise Payment in respect of such Option Shares, but only including in such aggregate amounts paid in cash or by offset pursuant to clause (a)  or (b) of Section  2.4 , respectively, of the AVH Call Option Agreement with respect to such Option Shares;

(iii)    if the United Group owns any Shares as a result of a payment in kind by NewCo to United pursuant to, and in accordance with, each of Section 2.8 of the NewCo Loan Agreement and Section 2.4(b)(ii) of the AVH Stock Appreciation Rights Agreement, the Fair Market Price Per Share as of the applicable Share Value Measurement Date, multiplied by the number of Shares Transferred to the United Group in connection with such payment by NewCo; and

(iv)    if the United Group owns any Shares as a result of United’s exercise of its rights pursuant to Section  2.4(a)(i) (United ROFR Exercise) and Section  2.5(b) (United ROFO Exercise), the aggregate price paid by United in connection with each such Transfer;

in each case set forth in clauses (i), (ii), (iii) and (iv), plus interest accruing as of the relevant Share Value Measurement Date at a rate of 3% per annum;

divided by ,

(b) the number of Shares held by the United Group as of such date.

“ United Buy-Out Closing Date ” has the meaning set forth in Section  3.3(a)(vii)(B) .

“ United Buy-Out Offer ” has the meaning set forth in Section  3.3(a)(vii) .

“ United Buy-Out Right ” has the meaning set forth in Section  3.3(a)(vii) .

 

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“ United Designee ” has the meaning set forth in the JAA.

“ United Election Notice ” has the meaning set forth in Section  2.9(b)(ii) .

“ United Election Period ” has the meaning set forth in Section  2.9(b)(ii) .

“ United Group ” has the meaning set forth in the JAA.

“ United Indemnified Matters ” has the meaning set forth in Section  6.1(c) .

“ United Indemnitees ” has the meaning set forth in Section  6.1(a) .

“ United Kingsland Offer Period ” has the meaning set forth in Section  2.4(b)(ii)(A) .

“ United Kingsland Notice of Exercise ” has the meaning set forth in Section  2.4(b)(ii)(A) .

“ United Kingsland ROFO Exercise Closing ” has the meaning set forth in Section  2.6(b) .

“ United Kingsland ROFO Exercise Notice ” has the meaning set forth in Section  2.6(b) .

“ United Kingsland ROFO Period ” has the meaning set forth in Section  2.6(b) .

“ United Kingsland ROFR Closing ” has the meaning set forth in Section  2.4(b)(ii)(A) .

“ United Kingsland Matching Notice ” has the meaning set forth in Section  2.4(b)(iv) .

“ United NewCo Matching Notice ” has the meaning set forth in Section  2.4(a)(iv) .

“ United NewCo ROFO Exercise Closing ” has the meaning set forth in Section  2.5(b) .

“ United NewCo ROFO Exercise Notice ” has the meaning set forth in Section  2.5(b) .

“ United NewCo ROFO Period ” has the meaning set forth in Section  2.5(b) .

“ United NewCo Notice of Exercise ” has the meaning set forth in Section  2.4(a)(ii) .

“ United NewCo Offer Period ” has the meaning set forth in Section  2.4(a)(ii) .

“ United NewCo ROFR Closing ” has the meaning set forth in Section  2.4(a)(ii) .

“ United Ownership Threshold Failure ” means, at any time, (a) the United Group owns less than 15% of the then outstanding Common Shares and (b) the NewCo Group owns at least four times the number of Common Shares owned by the United Group, provided that for purposes of calculating the ownership of the United Group pursuant to clauses  (a) and (b)  above, the United Group will be deemed to own all of the Common Shares owned of record by the Kingsland Group (x) prior to the fifth anniversary of the Effective Date unless the NewCo Put Shares Buy-Out Right shall have been consummated with respect to all of the Put Shares, and (y) thereafter, only if once Kingsland has Exercised or been deemed to have Exercised the Put Option.

 

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“ United Purchase Offer ” has the meaning set forth in Section  2.9(a)(i) .

“ United ROFO Shares ” has the meaning set forth in Section  2.9(b)(i) .

“ United ROFR Shares ” has the meaning set forth in Section  2.9(a)(i) .

“ United Sale Notice ” has the meaning set forth in Section  2.9(b)(i) .

“ United Seller ” has the meaning set forth in Section  2.2(a) .

“ Upside Sharing Agreement ” means that certain Upside Sharing Agreement, to be entered into by and between United and Kingsland.

“ Usufruct Documents ” has the meaning set forth in the Put Option Agreement.

Section 1.2     Rules of Construction .

(a)    All article, section, subsection, preamble, recital or exhibit references used in this Agreement are to an article, section, subsection, preamble or recital to this Agreement unless otherwise specified. All exhibits attached to this Agreement constitute a part of this Agreement and are incorporated herein for all purposes. If a term is defined as one part of speech (such as a noun), it shall have a corresponding meaning when used as another part of speech (such as a verb). Unless the context of this Agreement clearly requires otherwise (i) the singular shall include the plural and the plural shall include the singular wherever and as often as may be appropriate; (ii) the words “includes” or “including” shall mean “including without limitation”; (iii) the words “hereof,” “hereby,” “herein,” “hereunder” and similar terms in this Agreement shall refer to this Agreement as a whole and not any particular article, section, subsection or exhibit, in which such words appear; (iv) the words “own” or “owns” or “ownership” or “owner” and words with correlative meaning shall mean Beneficially Own or Beneficial Ownership or Beneficial Owner, as applicable and (v) the gender of all words used in this Agreement includes the masculine, feminine and neuter.

(b)    The headings of articles, sections, subsections or exhibits of this Agreement are for purposes of reference only and shall not limit or otherwise affect the meaning or interpretation of this Agreement.

(c)    References to any Law will include all rules and regulations promulgated thereunder, and references to any Law will be construed as including any legal and statutory provisions consolidating, amending, succeeding or replacing such Law.

(d)    References to any document will include any amendment, restatement or supplement to, or replacement or novation of, such document, but disregarding any amendment, restatement, supplement, replacement or novation made in breach of this Agreement.

(e)    Except as may be otherwise expressly provided, any reference herein to an approval, consent, determination, election, exercise of right, decision, removal or similar discretionary act of a Person or body shall mean that such is to be made in the sole and absolute discretion of such Person or body.

 

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(f)    Where any provision in this Agreement refers to action to be taken by any Person, or which such Person is prohibited from taking, such provision will be applicable whether such action is taken directly or indirectly by such Person, including actions taken by or behalf of any Affiliate of such Person.

(g)    Currency amounts referenced herein, unless otherwise specified, are in U.S. Dollars.

(h)    All accounting terms used herein and not otherwise defined herein will have the meanings accorded them in accordance with IFRS and, except as expressly provided herein, all accounting determinations will be made in accordance with such accounting standards in effect from time to time.

(i)    Each Party acknowledges that it has the relevant experience and sophistication required to adequately assess and evaluate the risks associated with the transactions contemplated hereby and to make the investment decision (as applicable) contemplated hereby. Each Party has had an adequate opportunity to review each and every provision of this Agreement and to submit the same to legal counsel for review and advice. Based on the foregoing, the language used in this Agreement shall be deemed to be the language chosen by the Parties to express their mutual intent, and the rule of construction, if any, that a contract be construed against the drafter shall not apply to interpretation or construction of this Agreement.

(j)    If at any time the number of Preferred Shares of the Company comprising an AVH ADS is no longer eight, all references in this Agreement to “ divided by eight” or similar phrases will be deemed to be changed to reflect the actual number of Preferred Shares comprising each AVH ADS at such time.

ARTICLE 2

TRANSFER OF SHARES

Section 2.1     Restrictions on the Transfers of Shares .

(a)    Subject to the AVH Pledge Agreement and the Pledge and Custody Agreement, without the prior written approval of United, which approval may be withheld or conditioned on such terms or matters as determined by United in its sole and absolute discretion, none of Kingsland, NewCo or any of their respective Permitted Transferees may Transfer or cause to be Transferred any Shares to a Non-Permitted Holder.

(b)    Subject to the AVH Pledge Agreement, the Pledge and Custody Agreement and Section  2.1(a) , without the prior written approval of United, which approval may be withheld or conditioned on such terms or matters as determined by United in its sole and absolute discretion, none of Kingsland, NewCo or any of their respective Permitted Transferees may Transfer or cause to be Transferred any Shares to a Person that is not a Non-Permitted Holder (i) unless (A) such Transfer is to a Permitted Transferee or (B) the applicable member of the NewCo Group or the Kingsland Group, as applicable, has first complied with the procedures set forth in Section  2.4 , Section  2.5 and Section  2.6 , as applicable; (ii) unless, in the case of NewCo, (A) NewCo and each of its Affiliates is otherwise in compliance with its material obligations under the Transaction Documents to which it is a party and (B) an Event of Default has not occurred and is not continuing;

 

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and (iii) in the case of Kingsland, there has not been a Kingsland Material Breach that has not been waived or cured, if capable of being cured; provided, however , that the restrictions under this Section  2.1(b) will not apply to any Transfers by NewCo (1) to United or (2) of Preferred Shares that are permitted for purposes of any payment of obligations under, and in accordance with, Section 2.8 of the NewCo Loan Agreement or Section 2.4(b)(ii) of the AVH Stock Appreciation Rights Agreement.

(c)    Only with respect to the Common Shares that United acquires pursuant to the AVH Call Option Agreement (such Common Shares, collectively, the “ Optioned AVH Shares ”), United may not Transfer or cause to be Transferred any Optioned AVH Shares to a third party, unless such Optioned AVH Shares are first converted into Preferred Shares; provided , however , that the transfer restriction in this Section  2.1(c) shall not apply (i) for so long as an Event of Default has occurred and is continuing, (ii) if NewCo or any of its Affiliates has breached any of its material obligations under any Transaction Document to which it is a party and such breach has not been waived or cured, if capable of being cured or (iii) to any Transfer by United of Shares in accordance with Section  2.3 or in connection with the exercise of United’s rights under Section  2.7 or Section  2.8 ; provided further , however , that if such conversion of Optioned AVH Shares into Preferred Shares by United would otherwise (x) cause all of the Preferred Shares to have voting rights pursuant to the Company’s Organization Documents or (y) cause Synergy and Kingsland to lose Control of the Company, then United shall have the right to Transfer (without first having to convert into Preferred Shares and together with any converted shares) the amount of AVH Optioned Shares that exceed the number of Common Shares that can be converted without triggering the events described in sub-clauses  (x) or (y)  above.

(d)    The Parties agree and acknowledge that any Transfer of Shares by any of the Parties is subject to the restrictions on Transfer set forth in this Article  2 and to the AVH Pledge Agreement and the Pledge and Custody Agreement, as applicable, and that any certificated Shares will include a legend reflecting that such restrictions exist under this Agreement. Any attempt not in compliance with this Agreement, the JAA and the Organization Documents of the Company to make any Transfer of Shares shall be null and void and of no force and effect, the purported transferee shall have no title to the Shares nor rights or privileges in or with respect to the Company, under this Agreement, the JAA or under the Organization Documents of the Company, and the Company shall not annotate or otherwise reflect in the Company’s share registry such attempted Transfer. Other than in connection with a Transfer of Preferred Shares effectuated in accordance with this Agreement by Kingsland or NewCo, as a condition to the effectiveness of any Transfer of Shares permitted hereunder to any Person, such Person must execute and deliver to United a joinder to this Agreement in a form reasonably acceptable to United. Notwithstanding the foregoing, nothing in this Agreement shall limit the rights or obligations of any party thereto under the AVH Call Option Agreement, the Put Option Agreement, the Cooperation Agreement and the Upside Sharing Agreement, including the ability of Kingsland or NewCo to Transfer its Shares (or the voting and economic rights of such Shares pursuant to the Usufruct Documents) to United (or a United Designee, as applicable) pursuant thereto; provided , however , that, notwithstanding anything in this Agreement to the contrary, if the Put Option has been Exercised or deemed to have been Exercised, Kingsland may not Transfer or cause to be Transferred the Put Shares subject to such Exercise other than to United or as directed by United in accordance with the Put Option Agreement and this Agreement.

 

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(e)    Notwithstanding anything in this Agreement to the contrary:

(i)    NewCo’s rights to Transfer any Shares under Sections 2.4(a) and 2.5 , and NewCo’s rights to acquire United’s Shares under Section  2.9 , shall cease to apply if United (or a United Designee) is exercising its rights under Sections 2.3 or 2.7.

(ii)    Kingsland’s rights to Transfer any Shares under Sections 2.4(b) and 2.6 , shall cease to apply if United (or a United Designee) is exercising its rights under Sections 2.3 or 2.8 .

(f)    Notwithstanding anything in this Agreement to the contrary:

(i)    if United or a United Designee is obligated to pay for any Shares owned by the NewCo Group that are Transferred to United or a United Designee in connection with the exercise of United’s rights under Section  2.3 , Section  2.4(a) , Section  2.5 or Section  2.7 , United (or such United Designee, as applicable) shall be entitled to offset all or a portion of such payment against the Obligations then owed by NewCo to United under the NewCo Loan Agreement and the AVH Stock Appreciation Rights Agreement; and

(ii)    the payment of any amounts to which the Kingsland Group would otherwise be entitled to receive for any Shares Transferred by the Kingsland Group in accordance with this Article 2 shall be subject to the Upside Sharing Agreement and the Kingsland Financing Documents.

Section 2.2     Tag Along Rights .

(a)     Participation . If, at any time, United, a United Designee (other than Kingsland) and/or any Permitted Transferee of United who holds Shares (for purposes of this Section  2.2 , each and collectively, a “ United Seller ”) (i) owns at least as many shares as Kingsland and (ii) proposes to Transfer to any Person or Persons who are not Permitted Transferees of any United Seller or NewCo (or its Permitted Transferees) (the “ Proposed Transferee ”), in a single transaction or series of related transactions (including by way of a purchase agreement, tender offer, merger or other business combination transaction or otherwise), a number of Shares which is equal to or greater than 20% of the number of Shares held by such United Seller as of immediately prior to the consummation of such transaction(s), and United cannot or has not elected to exercise its drag-along rights set forth in Section  2.3 , Kingsland and any Permitted Transferee thereof (each, a “ Tag-along Shareholder ”) shall be permitted to participate in such sale (a “ Tag-along Sale ”) on the terms and conditions set forth in this Section  2.2 ; provided , however , that (x) any Transfer by United to comply with any regulatory requirements or any of United’s collective bargaining agreements shall not be subject to this Section  2.2 , (y) prior to the tenth anniversary of the date hereof, Kingsland may not sell any Shares at a price that is less than $1.5625 per Share (as adjusted for the occurrence of any Adjustment Events) and (z) in the event Kingsland exercises its Put Option under the Put Option Agreement with respect to any Put Shares prior to the Put Option Closing Date, Kingsland’s rights under this Section  2.2 shall terminate on the Put Option Closing Date with respect to such Put Shares for which the Put Option has been Exercised.

(b)     Sale Notice . Prior to the consummation of the Tag-along Sale, the United Seller shall deliver to Kingsland and/or any Permitted Transferee thereof a written notice

 

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substantially the form attached hereto as Exhibit  B (a “ Sale Notice ”) of the proposed Transfer subject to this Section  2.2 no more than five Business Days after the execution and delivery by all the parties thereto of the definitive agreements entered into with respect to such Tag-along Sale and, in any event, no later than 20 Business Days prior to the closing date of such Tag-along Sale. The Sale Notice shall make reference to the Tag-along Shareholders’ rights hereunder and shall describe in reasonable detail:

(i)    the number of Shares to be sold by the United Seller;

(ii)    the name of the Proposed Transferee;

(iii)    the per Share purchase price and the other material terms and conditions of such Tag-along Sale, including a description of any non-cash consideration in sufficient detail to permit the valuation thereof;

(iv)    the proposed date, time and location of the closing of such Tag-along Sale; and

(v)    a copy of any definitive Share purchase and sale agreement entered into with respect to such Tag-along Sale or form of Share purchase and sale agreement proposed to be executed in connection therewith.

(c)     Shares to be Sold .

(i)    Each Tag-along Shareholder shall exercise its right to participate in a Tag-along Sale subject to this Section  2.2 by delivering to the United Seller a written notice substantially in the form attached hereto as Exhibit  C (a “ Tag-along Notice ”) stating its election to do so and specifying the number of Shares to be sold by such Tag-along Shareholder in accordance with this Section  2.2(c)(i) no later than 10 Business Days after receipt of the applicable Sale Notice (the “ Tag-along Period ”). The election by a Tag-along Shareholder of the right to participate in a Tag-along Sale set forth in a Tag-along Notice shall be irrevocable and binding, and such Tag-along Shareholder shall be obligated to sell its Shares in such Tag-along Sale on the terms and conditions set forth in this Section  2.2 . Each Tag-along Shareholder shall have the right to sell in a Tag-along Sale subject to this Section  2.2 up to a number of Shares equal to the product obtained by multiplying (A) the number of Shares held by such Tag-along Shareholder by (B) a fraction (x) the numerator of which is equal to the maximum number of Shares the Proposed Transferee is willing to purchase and (y) the denominator of which is equal to the total number of Shares owned by the Shareholders participating in such Tag-along Sale (the “ Maximum Tag Amount ”). For the avoidance of doubt, the number of Shares the United Seller would otherwise be entitled to Transfer pursuant to this Section  2.2 shall be reduced by the number of Shares which the Tag-along Shareholders elect to sell, which number shall not exceed the Maximum Tag Amount, pursuant to this Section  2.2(c) .

(ii)    Each Tag-along Shareholder who does not deliver a Tag-along Notice in compliance with Section  2.2(c)(i) shall be deemed to have waived all of such Tag-along Shareholder’s rights to participate in such Tag-along Sale, and the United Seller shall (subject to the rights of any participating Tag-along Shareholder) thereafter be free to sell to the Proposed Transferee its Shares at a per Share purchase price that is no greater than the per Share purchase price set forth in the applicable Sale Notice and on other terms and conditions which are not materially more favorable to the United Seller than those set forth in such Sale Notice, without any further obligation to the non-participating Tag-along Shareholders.

 

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(d)     Conditions of Sale . Each Tag-along Shareholder participating in a Tag-along Sale pursuant to this Section  2.2 shall receive the same form and amount of consideration per Share as is received by the United Seller, or, if the United Seller is given an option as to the form or amount of consideration per Share, the Tag-along Shareholders will be given the same option, which option shall be described in the Sale Notice and shall be selected by the Tag-along Shareholders in the Tag-along Notice. Each Tag-along Shareholder shall make or provide the same representations, warranties, covenants, indemnities and agreements as the United Seller makes or provides in connection with such Tag-along Sale (except that, in the case of representations, warranties, covenants, indemnities and agreements pertaining specifically to the United Seller, such Tag-along Shareholder shall make the comparable representations, warranties, covenants, indemnities and agreements pertaining specifically to itself); provided , however , that all representations, warranties, covenants and indemnities shall be made by the United Seller and each other Tag-along Shareholder severally and not jointly.

(e)     Cooperation . Each Tag-along Shareholder participating in the Tag-along Sale shall take all actions as may be reasonably necessary to consummate the Tag-along Sale, including entering into agreements and delivering certificates and instruments, in each case, consistent with the agreements being entered into and the certificates being delivered by the United Seller.

(f)     Deadline for Completion of Sale . The United Seller shall have 120 days following the expiration of the Tag-along Period in which to sell the Shares described in the applicable Sale Notice, on terms not more favorable to the United Seller than those set forth in such Sale Notice (which such 120-day period may be extended for a reasonable time to the extent reasonably necessary to obtain any necessary governmental or regulatory approvals). If, at the end of such period, the United Seller has not completed such Tag-along Sale, the United Seller may not then effect a Tag-along Sale subject to this Section  2.2 without again fully complying with the provisions of this Section  2.2 .

(g)     Sales in Violation of the Tag-along Right . If the United Seller Transfers to the Proposed Transferee its Shares in breach of this Section  2.2 , then each Tag-along Shareholder shall have the right to sell to the United Seller, and the United Seller undertakes to purchase from such Tag-along Shareholder, the number of Shares that such Tag-along Shareholder would have had the right to sell to the Proposed Transferee pursuant to this Section  2.2 , for a per Share amount and form of consideration and upon the terms and conditions on which the Proposed Transferee bought such Shares from the United Seller, which, subject to the immediately following sentence, shall be such Tag-along Shareholder’s sole and exclusive remedy for a breach of this Section  2.2 . The United Seller shall also reimburse each Tag-along Shareholder for any and all reasonable and documented out-of-pocket fees and expenses, including reasonable legal fees and expenses, incurred pursuant to the exercise or the attempted exercise of such Tag-along Shareholder’s rights under this Section  2.2(g) .

 

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Section 2.3     Drag Along Rights .

(a)    If, at any time, (i) the United Group owns the majority of the Common Shares, or (ii) the United Group together with any other Shareholder owns the majority of the Common Shares, provided that the United Group owns at least 10% of the then outstanding Common Shares (it being understood that, if the Put Option has been Exercised or been deemed to have been Exercised, the United Group will be deemed to own the corresponding Common Shares of the Company owned of record by the Kingsland Group) (such Shareholder or Shareholders acting together, as the case may be, the “ Majority Shareholder ”) elect to Transfer to any Person or Persons who are not a Permitted Transferee of the Majority Shareholder (collectively, a “ Drag-Along Transferee ”), in a bona fide arms’-length transaction or series of related transactions (including by way of a purchase agreement, tender offer, merger or other business combination transaction or otherwise) all of the Shares held by such Majority Shareholder and its Affiliates on the date thereof (an “ Exit Sale ”), then the Majority Shareholder may, subject to the other provisions of this Section  2.3 , require each other Shareholder that is a Party to this Agreement and each of its Permitted Transferees (collectively, the “ Minority Shareholders ”) to Transfer all, but not less than all, of its Shares and to vote in favor of, consent to, raise no objections to, waive any appraisal rights with respect thereto, waive its JAA Approval Rights and all consent and approval rights under the JAA and the Company’s Organization Documents and take all commercially reasonable actions requested, necessary or desirable in connection with, the Exit Sale; provided , however , that if there is a continuing Event of Default, then United (or the United Designee, as applicable), will have the right to exercise the rights of the Majority Shareholder of this Section  2.3 regardless of the number of Shares held by the United Group.

(b)    The obligations of the Minority Shareholders to Transfer their Shares in connection with an Exit Sale are subject to the satisfaction of the following conditions: upon the consummation of the Exit Sale, the Minority Shareholders shall have received the same form and amount of consideration per Share as is received by the Majority Shareholder, or if the Majority Shareholder is given an option as to the form or amount of consideration per Share, the Minority Shareholders will be given the same option as described in, and in accordance with the procedures set forth in, the Drag-Along Notice. In connection with an Exit Sale, each Minority Shareholder shall (i) execute such documents, and (ii) make such representations, warranties, covenants and indemnities as to itself as are executed and made by the other Minority Shareholders with respect to the Company, provided that if NewCo is the only Minority Shareholder, then NewCo as a Minority Shareholder shall make customary representations and warranties made by a Minority Shareholder in similar transactions; provided further , however , that any such indemnification or other obligation assumed in connection with an Exit Sale shall be allocated among the Shareholders that are a Party to this Agreement in the same manner as the aggregate purchase price, other than with respect to representations made individually by the Majority Shareholder ( e . g ., representations as to title to Shares or authority). Any liability arising from the representations, warranties, covenants, indemnities or agreements relating to the Company or any of its Subsidiaries shall be borne by each Shareholder severally, and not jointly (unless, in the case of the Majority Shareholder only, such Majority Shareholder agrees to be jointly and severally liable in connection therewith). In no event shall the indemnification or other obligations of a Minority Shareholder assumed in connection with an Exit Sale exceed the aggregate value of the consideration actually received by such Minority Shareholder in respect of its Shares in connection with such Exit Sale.

 

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(c)    If the Majority Shareholder wishes to exercise its drag-along rights pursuant to this Section  2.3 , then it shall give written notice thereof substantially in the form attached hereto as Exhibit  D (the “ Drag-Along Notice ”) to each Minority Shareholder at least 30 days prior to the date on which the Majority Shareholder expects to consummate the Exit Sale. A Drag-Along Notice shall set forth: (i) the name and address of the Drag-Along Transferee and the identity of its economic group and the ultimate owner, if known, (ii) the proposed amount and form of consideration and terms and conditions of payment offered by the Drag-Along Transferee, including the details of any price adjustment mechanism, if applicable, (iii) any other material terms of the proposed transaction, including the expected closing date thereof, (iv) a copy of any executed purchase agreement (or other type of arrangement) with such Drag-Along Transferee or, if no such agreement exists, then a copy of any purchase agreement (or other type of arrangement) submitted or offered by such Drag-Along Transferee in connection with an Exit Sale, if any and (v) the action or actions reasonably requested or required of each Minority Shareholder (including those that may be reasonably requested or required in the future) in order to complete or facilitate such proposed Exit Sale (including (A) the Transfer of Shares owned by each Minority Shareholder, (B) the voting by such Minority Shareholder in favor of the Exit Sale and the transactions contemplated thereby and the waiver of any related appraisal or dissenters’ rights and/or (C) the execution and delivery of any merger, asset purchase, security purchase, recapitalization or other agreement, as applicable). NewCo and Kingsland hereby grant to United a limited power-of-attorney solely for purposes of the exercise of the Majority Shareholder’s rights under this Section  2.3 , including the right to execute and deliver, on behalf of NewCo and Kingsland, any agreement, transfer instrument or other document necessary to consummate such Exit Sale pursuant to this Section  2.3 ; provided, however , that United shall only be entitled to exercise this limited power-of-attorney with respect to any agreement, transfer instrument or other document if (x) such agreement, transfer instrument or other document is consistent with the limitations set forth in this Section  2.3 and (y) the Majority Shareholders have provided such agreement, transfer instrument or other document to NewCo and/or Kingsland, as applicable, and NewCo and/or Kingsland, as applicable, shall have failed to sign such agreement, transfer instrument or other document within five Business Days after receipt thereof.

(d)     Closing . The Majority Shareholder shall have 90 days following the delivery of the Drag-Along Notice to complete the Exit Sale (which such 90-day period may be extended for a reasonable time to the extent reasonably necessary to obtain any necessary approvals from a Governmental Authority). If, at the end of such period, the Majority Shareholder has not completed such Exit Sale, the Majority Shareholder may not then effect an Exit Sale subject to this Section  2.3 without again fully complying with the provisions of this Section  2.3 .

Section 2.4     United Right of First Refusal .

(a)     NewCo .

(i)     Purchase Offer . Subject to Section  2.1 and only as permitted under the NewCo Loan Agreement, if, at any time and from time to time NewCo or any of its Permitted Transferees or the Collateral Agent (each, a “ NewCo Seller ”) receives a bona fide purchase offer, whether through a bid process, unsolicited, forced sale, judicial foreclosure, auction, public sale, private sale or otherwise (a “ Bona Fide Offer ”) from a third party that is not a Permitted Transferee (each, a “ Third-Party Purchaser ”) to Transfer all or any portion of the Shares owned by NewCo

 

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(such Shares proposed to be sold in connection with such Bona Fide Offer, the “ NewCo ROFR Shares ”), which Bona Fide Offer such NewCo Seller intends to accept, then such NewCo Seller shall deliver to United, no later than 30 days prior to accepting such Bona Fide Offer, an offer substantially in the form attached hereto as Exhibit  E (a “ NewCo Purchase Offer ”) to sell to United all of the NewCo ROFR Shares. The NewCo Purchase Offer shall (A) be in writing; (B) set forth the same purchase price as is set forth in the Bona Fide Offer, payable on the same terms as set forth in the Bona Fide Offer; and (C) include (1) financing terms, (2) other terms and conditions as are set forth in the Bona Fide Offer, in each case, that are at least as favorable to United as those contained in the Bona Fide Offer are to such Third-Party Purchaser and (3) a copy of any executed purchase agreement (or other type of arrangement) with such Third-Party Purchaser or, if no such agreement (or arrangement) exists, then a copy of any purchase agreement (or other type of arrangement) submitted or offered by such Third-Party Purchaser in connection with the Bona Fide Offer; provided, however , that the restrictions under this Section  2.4 will not apply to any Transfers by NewCo that are permitted for purposes of any payment of obligations under, and in accordance with, Section 2.8 of the NewCo Loan Agreement and Section 2.4(b)(ii) of the AVH Stock Appreciation Rights Agreement;

(ii)     Exercise . During the 10 Business Day-period following the receipt of a NewCo Purchase Offer (the “ United NewCo Offer Period ”), United shall have the right, at its sole option and at any time prior to the expiration of the United NewCo Offer Period, to accept, or designate a United Designee to accept, such NewCo Purchase Offer on the price and terms as set forth in the NewCo Purchase Offer, which right may be exercised by giving irrevocable written notice of exercise thereof substantially in the form attached hereto as Exhibit  F (a “ United NewCo Notice of Exercise ”) to the NewCo Seller and, subject to the immediately following sentence, by tendering performance at the principal offices of the Company, within 20 Business Days after the delivery of the United NewCo Notice of Exercise (the “ United NewCo ROFR Closing ”). At the United NewCo ROFR Closing, the NewCo Seller shall cause the NewCo ROFR Shares to be delivered as directed by United (or to the United Designee, as applicable), along with the applicable Transfer Documents; provided , however , that while the NewCo Loan Agreement is in effect, at United’s option, all or portion of the payment by United for the NewCo ROFR Shares may be offset by United against the Obligations.

(iii)     Closing . Subject to Section  2.1 and any Transfer of Shares pursuant to Section  2.7 , after the NewCo Seller has complied with the procedures set forth in this Section  2.4 and (A) if United (or the United Designee, as applicable) fails to deliver to NewCo a United NewCo Notice of Exercise during the United NewCo Offer Period, (B) United (or the United Designee) fails to purchase the NewCo ROFR Shares within the time period set forth in Section  2.4(a)(ii) or (C) United (or the United Designee) notifies NewCo that it will not exercise the NewCo Purchase Offer, then the NewCo Seller may sell such NewCo ROFR Shares within 90 days (which such 90-day period may be extended for a reasonable time to the extent reasonably necessary to obtain any necessary governmental or regulatory approvals) after expiration of the United NewCo Offer Period to the Third-Party Purchaser for the price and on the terms specified in the Bona Fide Offer, or at a price equal to or greater than the price specified in the Bona Fide Offer, with financing terms no more favorable to the Third-Party Purchaser than those set forth in the Bona Fide Offer and on other terms and conditions that are not more favorable to the Third-Party Purchaser than the terms and conditions set forth in the Bona Fide Offer. If the NewCo Seller fails to complete such a transaction with such Third-Party Purchaser within such 90-day

 

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period (which such 90-day period may be extended for a reasonable time to the extent reasonably necessary to obtain any necessary governmental or regulatory approvals), such NewCo Seller shall again be required to comply with the procedures of this Section  2.4 with respect to such (or any future) Bona Fide Offer. Promptly following the consummation of such transaction, the NewCo Seller shall notify United of the consummation thereof and shall furnish evidence of the completion of such sale and of the terms thereof as may reasonably requested by United.

(iv)     Conditions . The NewCo Seller shall, at least 5 Business Days prior to the closing of the sale of the NewCo ROFR Shares to a Third-Party Purchaser, deliver to the Company and United (or the United Designee, as applicable) a written certificate executed by an officer of such NewCo Seller in substantially the form attached hereto as Exhibit  G (i) specifying that (A) such NewCo Seller has complied in all respects with the terms and conditions of this Section  2.4 including this Section  2.4(a)(iv) and, if applicable, has offered United the ability to match the terms set forth in such NewCo Seller’s agreement with the Third-Party Purchaser, but such offer was not accepted by United (or the United Designee, as applicable) as set forth, and within the period specified, below and (B) the sale is in compliance with Section  2.1 ; and (ii) attaching a copy of the executed purchase agreement with the Third-Party Purchaser, which purchase agreement (or other type of arrangement) shall include a condition precedent that such NewCo Seller shall have fully complied with the provisions of this Section  2.4 . If the terms of such NewCo Seller’s agreement with the Third-Party Purchaser are more favorable to the Third-Party Purchaser than those set forth in the Bona Fide Offer, then in order to avoid violating the provisions of Section  2.4(b)(iii) , in lieu of such NewCo Seller’s being required to comply again with all the provisions of this Agreement, including this Section  2.4 , with respect to the enhanced Bona Fide Offer, such NewCo Seller shall provide prior written notice to United substantially in the form attached hereto as Exhibit  H (the “ United NewCo Matching Notice ”) at least 30 Business Days prior to the closing of the sale of the NewCo ROFR Shares to a Third-Party Purchaser detailing with reasonable specificity any material terms or conditions in such NewCo Seller’s agreement (written or oral) with the Third-Party Purchaser that are more favorable than those specified in the original Bona Fide Offer. United (or the United Designee, as applicable) shall have the right to match the terms set forth in such NewCo Seller’s agreement as described in the United NewCo Matching Notice by delivering written notice to the NewCo Seller within 10 Business Days following the date that the United NewCo Matching Notice is delivered to United (or the United Designee, as applicable). If United elects not to exercise its right to match or fails to deliver its United NewCo Matching Notice in the time period described above, the NewCo Seller may sell the NewCo ROFR Shares to the Third-Party Purchaser for the price and on the terms specified in the United NewCo Matching Notice, or at a price equal to or greater than the price specified in the United NewCo Matching Notice, with financing terms no more favorable to the Third-Party Purchaser than those set forth in the United NewCo Matching Notice and on other terms and conditions that are not more favorable to the Third-Party Purchaser than the terms and conditions set forth in United NewCo Matching Notice. If United (or the United Designee, as applicable) exercises its right to match the Third Party Purchaser’s offer as set forth above, such transaction between the NewCo Seller and United (or the United Designee, as applicable) shall be closed, on terms matched by United (or the United Designee, as applicable) within 15 Business Days following the date of the notice delivered by United (or the United Designee, as applicable) to the NewCo Seller (which such 15-day period may be extended for a reasonable time to the extent reasonably necessary to obtain any necessary governmental or regulatory approvals).

 

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(b)     Kingsland .

(i)     Purchase Offer . Subject to Section  2.1 , if, at any time and from time to time after the third anniversary of the Effective Date or, in the case of Kingsland’s exercise of its rights pursuant to Section 4.04 of the JAA (the “ Kingsland JAA Tag-Along Rights ”) at any time and from time to time after the date of this Agreement, Kingsland or any of its Permitted Transferees (each, a “ Kingsland Seller ”) (A) receives a Bona Fide Offer from a Third-Party Purchaser to Transfer all or any portion of the Shares owned by Kingsland to such Third-Party Purchaser, which Bona Fide Offer such Kingsland Seller intends to accept, or (B) elects to exercise the Kingsland JAA Tag Along Rights to Transfer all, but not less than all, of the Shares owned by Kingsland in connection with the exercise of the Kingsland JAA Tag Along Rights, then, no later than 15 days prior to either accepting such Bona Fide Offer or providing notice of its election to exercise the Kingsland JAA Tag Along Rights to Synergy pursuant to Section 4.04 of the JAA, such Kingsland Seller shall deliver to United an offer substantially in the form attached hereto as Exhibit  I (a “ Kingsland Purchase Offer ”) to sell to United all of the Shares proposed to be sold in connection with such Bona Fide Offer or exercise of the Kingsland JAA Tag Along Rights (the “ Kingsland ROFR Shares ”); provided, however , that in each case of clauses (A) and (B), that Kingsland may not Transfer any Put Shares with respect to which the Put Option has been Exercised or deemed to have been Exercised pursuant to the Put Option Agreement. The Kingsland Purchase Offer shall (x) be in writing; (y) set forth the same purchase price as is set forth in the Bona Fide Offer or Synergy’s notice to Kingsland under Section 4.04 of the JAA regarding the Synergy Change in Control Transaction (as defined in the JAA) (the “ Synergy COC Transaction Notice ”), as applicable, payable on the same terms as set forth in the Bona Fide Offer or, in the case of a Synergy COC Transaction Notice, in accordance with Section 4.04 of the JAA; and (z) include (1) financing terms, (2) other terms and conditions as are set forth in the Bona Fide Offer or the Synergy COC Transaction Notice, subject to Section 4.04 of the JAA, in each case, that are at least as favorable to United as those contained in the Bona Fide Offer are to such Third-Party Purchaser or counterparty to the Synergy Change in Control Transaction and (3) a copy of any executed purchase agreement (or other type of arrangement) with such Third-Party Purchaser or, if no such agreement exists, then a copy of any purchase agreement (or other type of arrangement) submitted or offered by such Third-Party Purchaser in connection with the Bona Fide Offer or delivered by Synergy to Kingsland pursuant to Section 4.04 of the JAA.

(ii)     Exercise.

(A)     United . During the 10 Business Day-period following the receipt of a Kingsland Purchase Offer (the “ United Kingsland Offer Period ”), United shall have the right, at its sole option and at any time prior to the expiration of the United Kingsland Offer Period, to accept, or designate a United Designee to accept, such Kingsland Purchase Offer on the price and terms as set forth in the Kingsland Purchase Offer, which right may be exercised by giving irrevocable written notice of exercise thereof substantially in the form attached hereto as Exhibit  J (a “ United Kingsland Notice of Exercise ”) to the Kingsland Seller within the United Kingsland Offer Period and, subject to the immediately following sentence, by tendering performance at the principal offices of the Company, within 20 Business Days after the delivery of the United Kingsland Notice of Exercise (the “ United Kingsland ROFR Closing ”). At the United Kingsland ROFR Closing, the

 

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Kingsland Seller shall cause the Kingsland ROFR Shares to be delivered as directed by United (or to the United Designee, as applicable), along with the applicable Transfer Documents; provided , however , that (1) United may elect in the United Notice of Exercise to delay the purchase of all or any portion of the Kingsland ROFR Shares in accordance with the terms and conditions of the Put Option Agreement and the Upside Sharing Agreement, as applicable (a “ Delayed ROFR Sale ”) and (2) in addition and at United’s option, at the United ROFR Closing or the Put Option Closing Date, as applicable, Kingsland shall also execute and deliver the Usufruct Documents with respect to the Kingsland ROFR Shares as directed by United (or the United Designee, as applicable), and the provisions of Section 2.8 of the Put Option Agreement shall apply, mutatis mutandis , to the purchase by United of the Kingsland ROFR Shares and optional delivery of the Usufruct Documents pursuant to this Section  2.4 .

(B)     NewCo Second ROFR Exercise .

(i)    In connection with a potential Transfer by the Kingsland Seller of Kingsland ROFR Shares to a Third Party Purchaser following receipt by the Kingsland Seller of a Bona Fide Offer from such Third-Party Purchaser (but not in connection with Kingsland’s exercise of its rights under Section 4.04 of the JAA), if NewCo has paid in full all of its Obligations, then United (or the United Designee, as applicable) shall deliver a copy of the Kingsland Purchase Offer received from the Kingsland Seller to NewCo within five days of receiving such Kingsland Purchase Offer, and during the United Kingsland Offer Period, if NewCo desires to accept such Kingsland Purchase Offer on the price and terms as set forth in the Kingsland Purchase Offer, NewCo shall give United (or the United Designee, as applicable) and Kingsland irrevocable written notice (subject to any United Kingsland Notice of Exercise), substantially in the form attached hereto as Exhibit  K (a “ Second ROFR Notice of Exercise ”). Contemporaneously with the delivery of the Second ROFR Notice of Exercise, NewCo shall pay to the Kingsland Seller in immediately available funds by wire transfer to an account specified by the Kingsland Seller, a non-refundable cash deposit in an amount equal to $5,000,000 (the “ NewCo ROFR Deposit ”).

(ii)    If (1) NewCo has delivered to United (or the United Designee, as applicable) and Kingsland a Second ROFR Notice of Exercise during the United Offer Period, (2) NewCo has paid the NewCo ROFR Deposit and (3) either United (or the United Designee, as applicable) (x) has informed NewCo and Kingsland in writing that it will not deliver a United Kingsland Notice of Exercise or (y) has not delivered a United Kingsland Notice of Exercise before the expiration of the United Kingsland Offer Period, then NewCo shall consummate the purchase by NewCo of the Kingsland ROFR Shares (the “ Second ROFR Closing ”), which Second ROFR Closing shall take place at the principal offices of the Company within 20 Business Days after the delivery of the Second ROFR Notice of Exercise. At the Second ROFR Closing, Kingsland shall execute and deliver to NewCo the applicable Transfer Documents, NewCo shall tender

 

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performance of the Kingsland Purchase Offer on the price and terms set forth in the Kingsland Purchase Offer at the principal offices of the Company and the NewCo ROFR Deposit shall be applied to the purchase price at the Second ROFR Closing; provided , however , that if NewCo fails to consummate the purchase of the Kingsland ROFR Shares on the Second ROFR Closing, then Kingsland may retain the NewCo ROFR Deposit together with any interest or income thereon, as liquidated damages, free of any claims by NewCo or any other Person with respect thereto.

(iii)    If United (or the United Designee, as applicable) (1) has informed NewCo and Kingsland in writing that it will deliver a United Kingsland Notice of Exercise or (2) delivers a United Kingsland Notice of Exercise before expiration of the United Kingsland Offer Period, then Kingsland shall refund to NewCo the NewCo ROFR Deposit, without any interest accrued thereon, free of any claims by it or any other Person with respect thereto.

(iii)     Closing . Subject to Section  2.1 , after the Kingsland Seller has complied with the procedures set forth in this Section  2.4 , and if (A) (1) United (or the United Designee, as applicable) fails to deliver a United Kingsland Notice of Exercise during the United Kingsland Offer Period or (2) NewCo fails to deliver a Second ROFR Notice of Exercise during the United Kingsland Offer Period (or fails to deliver the NewCo ROFR Deposit contemporaneously with the Second ROFR Notice of Exercise) or (B) United (or the United Designee, as applicable) or NewCo fails to purchase the Kingsland ROFR Shares within the time period set forth in Section  2.4(b) , then the Kingsland Seller may sell the applicable Kingsland ROFR Shares within 90 days (which such 90-day period may be extended for a reasonable time to the extent reasonably necessary to obtain any necessary governmental or regulatory approvals) after expiration of the United Kingsland Offer Period to (x) the Third-Party Purchaser for the price and on the terms specified in the Bona Fide Offer, or at a price equal to or greater than the price specified in the Bona Fide Offer, with financing terms no more favorable to the Third-Party Purchaser than those set forth in the Bona Fide Offer and on other terms and conditions that are not more favorable to the Third-Party Purchaser than the terms and conditions set forth in the Bona Fide Offer or (y) to the Synergy Buyer (as defined in the JAA) or Synergy (the “ Kingsland JAA Tag Buyer ”) in accordance Section 4.04 of the JAA; provided , however , that Kingsland shall not, (1) other than in connection with the exercise of Kingsland’s rights under Section 4.04 of the JAA, (2) sell more than such number of Shares that, if sold, would (i) reduce Kingsland’s ownership of Common Shares to less than 10% of all outstanding Common Shares or (ii) cause a change of Control of the Company and (2) until the tenth anniversary of the date hereof, sell the Kingsland ROFR Shares for a price that is less than $1.5625 Per Kingsland ROFR Share (as adjusted for the occurrence of any Adjustment Events); provided further, however , that Kingsland may not Transfer any Put Shares with respect to which the Put Option has been Exercised or is deemed to have been Exercised. If the Kingsland Seller fails to complete such a transaction with a Third-Party Purchaser or Kingsland JAA Tag Buyer within such 90-day period (which such 90-day period may be extended for a reasonable time to the extent reasonably necessary to obtain any necessary governmental or regulatory approvals or as necessary to comply with the terms of the sale to the Kingsland JAA Tag Buyer), the Kingsland Seller shall again be required to comply with the procedures of this Section  2.4 with respect to such (or any future) Bona Fide Offer. Promptly following such transaction, the Kingsland Seller shall notify United (or the United Designee, as applicable) and NewCo of the consummation thereof and shall furnish evidence of the completion of such sale and of the terms thereof as may be reasonably requested by United (or the United Designee, as applicable).

 

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(iv)     Conditions . The Kingsland Seller shall, at least 5 Business Days prior to the closing of the sale of the Kingsland ROFR Shares to a Third-Party Purchaser or the Kingsland JAA Tag Buyer, as applicable, deliver to the Company, United (or the United Designee, as applicable) and NewCo a written certificate executed by an officer of such Kingsland Seller in substantially the form attached hereto as Exhibit  L (i) specifying that (A) such Kingsland Seller has complied in all respects with the terms and conditions of this Section  2.4 and, if applicable, has offered United and NewCo the ability to match the terms set forth in such Kingsland Seller’s agreement with the Third-Party Purchaser or the Kingsland JAA Tag Buyer, as applicable, in accordance with this Section  2.4 , but such offer was not accepted by United (or the United Designee, as applicable) or NewCo as set forth, and within the period specified, below and (B) the sale is in compliance with Section  2.1 ; and (ii) attaching a copy of the executed purchase agreement with the Third-Party Purchaser or the Kingsland JAA Tag Buyer, as applicable, which purchase agreement (or other type of arrangement) shall include a condition precedent that such Kingsland Seller shall have fully complied with the provisions of this Section  2.4 . If the terms of the Kingsland Seller’s agreement with the Third-Party Purchaser or the Kingsland JAA Tag Buyer, as applicable, are more favorable to the Third-Party Purchaser or the Kingsland JAA Tag Buyer, as applicable, than those set forth in the Bona Fide Offer or the purchase agreement with respect to Kingsland’s exercise of the Kingsland JAA Tag Along Rights, then in order to avoid violating the provisions of Section  2.4(b)(iii) , in lieu of the Kingsland Seller’s being required to comply again with all the provisions of this Agreement, including this Section  2.4 , with respect to such (or any future) Bona Fide Offer, the Kingsland Seller shall provide prior written notice to United (or the United Designee, as applicable) and NewCo substantially in the form attached hereto as Exhibit  M (the “ United Kingsland Matching Notice ”) at least 30 Business Days prior to the closing of the sale of the Kingsland ROFR Shares to a Third-Party Purchaser or Kingsland JAA Tag Buyer (and United will deliver a copy of such United Kingsland Matching Notice to NewCo within five days of receipt), as applicable, detailing with reasonable specificity any material terms or conditions in the Kingsland Seller’s agreement (written or oral) with the Third-Party Purchaser or the Kingsland JAA Tag Buyer, as applicable, that are more favorable than those specified in the Bona Fide Offer or the Kingsland JAA Tag Along Rights as set forth in Section 4.04 of the JAA. United (or the United Designee, as applicable) shall have the right to match the terms set forth in such Kingsland Seller’s agreement as described in the United Kingsland Matching Notice by delivering written notice to the Kingsland Seller within 10 Business Days following the date that the United Kingsland Matching Notice is delivered to United (or the United Designee, as applicable). If United (or the United Designee, as applicable) elects not to exercise its right to match or fails to deliver its United Kingsland Matching Notice in the time period described above, other than in connection with the exercise of Kingsland’s rights under Section 4.04 of the JAA, NewCo may exercise its right to match by delivering notice to Kingsland within 5 Business Days after United’s election or failure to elect to match the offer set forth in the United Kingsland Matching Notice subject to the provisions set forth in Section  2.4(b)(ii)(B)(ii) with respect to the NewCo ROFR Deposit applying to this Section  2.4(b)(iv) , mutatis mutandis . If each of United (or the United Designee, as applicable) and NewCo elects not to exercise its right to match or fails to deliver a matching notice in the time period described above (or NewCo fails to deliver the NewCo ROFR Deposit contemporaneously with such notice), the Kingsland Seller may, sell the Kingsland

 

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ROFR Shares to the Third-Party Purchaser or the Kingsland JAA Tag Buyer, as applicable, for the price and on the terms specified in the United Kingsland Matching Notice, or at a price equal to or greater than the price specified in the United Kingsland Matching Notice, with financing terms no more favorable to the Third-Party Purchaser than those set forth in the United Kingsland Matching Notice and on other terms and conditions that are not more favorable to the Third-Party Purchaser or the Kingsland JAA Tag Buyer than the terms and conditions set forth in United Kingsland Matching Notice. If United (or the United Designee, as applicable) or NewCo as applicable, exercises its right to match the Third Party Purchaser’s or the Kingsland JAA Tag Buyer’s offer as set forth above, such transaction between the Kingsland Seller and United (or the United Designee, as applicable) or NewCo, as applicable, shall be closed, on terms matched by United (or the United Designee, as applicable) or NewCo as applicable, within 15 Business Days following the date of the notice delivered by United (or the United Designee, as applicable) or NewCo, as applicable, to the Kingsland Seller (which such 15-day period may be extended for a reasonable time to the extent reasonably necessary to obtain any necessary governmental or regulatory approvals).

Section 2.5     Right of First Offer on NewCo Shares .

(a)     Purchase Offer . Subject to Section 2.1 and the NewCo Loan Agreement, NewCo may, without being subject to the provisions set forth in Section  2.4(a) , on no more than one occasion every 12 months starting on the Effective Date, elect to sell Common Shares by converting such Common Shares into Preferred Shares to be sold on a securities exchange (such conversion to occur immediately prior to any such proposed sale but after all of the requirements and time periods set forth in this Section  2.5 have been satisfied, provided that if United (or the United Designee, as applicable) elects to purchase under this Section  2.5 , then United (or the United Designee, as applicable) shall be entitled to purchase Common Shares prior to any conversion) (such Common Shares to be sold or converted, as applicable, the “ NewCo ROFO Shares ”) in one or more block trades executed on the New York Stock Exchange or the BVC in accordance with this Section  2.5 (each, a “ NewCo Block Trade ”); provided, however , that the restrictions under this Section  2.5 will not apply to any Transfers by NewCo that are permitted for purposes of any payment of obligations under, and in accordance with, Section 2.8 of the NewCo Loan Agreement and Section 2.4(b)(ii) of the AVH Stock Appreciation Rights Agreement; provided further, however , that notwithstanding anything in this Section  2.5 to the contrary, the NewCo Seller may not Transfer any Shares if and when the Majority Shareholder delivers a Drag-Along Notice. In connection with NewCo’s desire to sell the NewCo ROFO Shares in NewCo Block Trades, NewCo shall deliver to United (or the United Designee, as applicable) an offer (a “ NewCo ROFO Offer ”) to sell to United (or the United Designee, as applicable) the NewCo ROFO Shares that (A) is in writing, (B) sets forth a purchase price all in cash, payable at closing, which price per NewCo ROFO Share (the “ NewCo ROFO Price ”) shall in no event be greater than the then-prevailing trading price of an AVH ADS divided by eight as of the date of the NewCo ROFO Offer, (C) is not conditioned on or coupled with any other transaction and (D) does not include any other material terms or conditions.

(b)     Exercise . During the 20-day period following the receipt by United of the NewCo ROFO Offer (the “ United NewCo ROFO Period ”), United shall have the right to elect to purchase, or designate a United Designee to purchase, up to all of the NewCo ROFO Shares (which, if purchased by United, or the United Designee, under this Section  2.5 , shall be Common

 

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Shares) covered by the NewCo ROFO Offer on the price and terms as set forth in the NewCo ROFO Offer, which right may be exercised by delivering to NewCo written notice of exercise thereof substantially in the form attached hereto as Exhibit  N (the “ United NewCo ROFO Exercise Notice ”) within the United NewCo ROFO Period. The consummation of such purchase by United (or the United Designee, as applicable) of the NewCo ROFO Shares (the “ United NewCo ROFO Exercise Closing ”) shall take place at the principal offices of the Company, within 60 days after the delivery of the United NewCo ROFO Exercise Notice. United (or the United Designee, as applicable) may include with its United NewCo ROFO Exercise Notice certain representations and warranties regarding ownership of the NewCo ROFO Shares, organization, authority and enforceability and similar fundamental matters that it desires NewCo to provide. At the United NewCo ROFO Exercise Closing, NewCo shall cause the NewCo ROFO Shares sold pursuant to this Section  2.5 to be delivered to United (or the United Designee, as applicable) along with the applicable Transfer Documents, and United shall pay to NewCo the NewCo ROFO Price by wire transfer of immediately available funds, except that while the NewCo Loan Agreement is in effect, at United’s option all or any portion of such payment may be offset by United against NewCo’s Obligations.

(c)     Block Trades . To the extent that the NewCo ROFO Shares that are the subject of a NewCo ROFO Offer are not purchased by United (or the United Designee, as applicable) or if United (or a United Designee, as applicable) has notified NewCo that it will not exercise the NewCo ROFO Offer, and after the expiration of the United NewCo ROFO Period, after NewCo has complied with the procedures set forth in this Section  2.5 and subject to Section  2.7 , NewCo may sell such NewCo ROFO Shares (1) on the New York Stock Exchange within 60 days after expiration of the United NewCo ROFO Period; or (2) on the BVC, within 90 days after expiration of the United NewCo ROFO Period, in one or more NewCo Block Trades for the price and on the terms specified in the NewCo ROFO Offer, or at a NewCo ROFO Price equal to or greater than the then-prevailing trading price of AVH ADS divided by eight in a transaction that is not conditioned on or coupled with any other transaction and does not include any other material terms or conditions. Notwithstanding the foregoing, if the volume of Preferred Shares which NewCo intends to sell is greater than 10% of the average daily trading volume, then the applicable term to consummate the Block Trade transaction will be automatically extended as reasonably necessary, but in no event for more than an additional 60 days, to consummate the number of Block Trades required to avoid violating applicable rules regarding trading more than the 10% of the average daily trading volume. NewCo will use all of the proceeds of such sale of the NewCo ROFO Shares to pay its outstanding Obligations in accordance with the NewCo Loan Agreement. If NewCo fails to sell all of the NewCo ROFO Shares within the periods set forth in this Section  2.5 , then any future proposed Transfer of NewCo ROFO Shares by NewCo or NewCo Block Trade shall remain subject to the other provisions of this Article  2 and, other than with respect to a failed sale due to the decline of the market price of such NewCo ROFO Shares by more than 15% since the NewCo ROFO Offer was made, such failed sale shall be deemed to be an exercise by NewCo of a NewCo Block Trade under this Section  2.5 .

Section 2.6     Right of First Offer on Kingsland Shares .

(a)     Purchase Offer . Subject to Section  2.1 and Section  3.4 , and provided that the Put Option has not been Exercised or been deemed to have been Exercised with respect to all of the Put Shares, Kingsland may, starting on the third anniversary of the Effective Date, on no

 

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more than one occasion every 12 months starting on the third anniversary of the Effective Date, without being subject to the provisions set forth in Section  2.4 , elect to sell Common Shares by converting such Common Shares into Preferred Shares to be sold on a securities exchange (such conversion to occur immediately prior to any such proposed sale but after all of the requirements and time periods set forth in this Section  2.6 have been satisfied, provided that if United (or the United Designee, as applicable) elects to purchase under this Section  2.6 , then United (or the United Designee, as applicable) shall be entitled to purchase Common Shares prior to any conversion) (such Common Shares to be sold or converted, as applicable, the “ Kingsland ROFO Shares ”) in one or more block trades executed on the New York Stock Exchange or the BVC in accordance with this Section  2.6 (each, a “ Kingsland Block Trade ”); provided , however , that Kingsland shall not (x) sell more than such number of Shares that, if sold, would (A) reduce Kingsland’s ownership of Common Shares to less than 10% of all outstanding Common Shares or (B) cause a change of Control of the Company and (y) until the tenth anniversary of the date hereof, sell the Kingsland ROFO Shares for a price that is less than $1.5625 per Kingsland ROFO Share (as adjusted for the occurrence of any Adjustment Events). In connection with Kingsland’s desire to sell the Kingsland ROFO Shares in Kingsland Block Trades, Kingsland shall deliver to United an offer (a “ Kingsland ROFO Offer ”), a copy of which shall be delivered to NewCo, to sell to United the Kingsland ROFO Shares that (A) is in writing; (B) sets forth a purchase price all in cash, payable at closing, which price per Kingsland ROFO Share (the “ Kingsland ROFO Price ”) shall in no event be (1) greater than the then-prevailing trading price of an AVH ADS divided by eight as of the date of the Kingsland ROFO Offer and (2) less than $1.5625 (as adjusted for the occurrence of any Adjustment Events) if Kingsland delivers such Kingsland ROFO Offer prior to the tenth anniversary of the date hereof; and (C) is not conditioned on or coupled with any other transaction and does not include any other material terms or conditions.

(b)     United Kingsland ROFO Exercise . During the 20-day period following the receipt by United of the Kingsland ROFO Offer (the “ United Kingsland ROFO Period ”), United shall have the right to elect to purchase, or designate a United Designee to purchase, up to all of the Kingsland ROFO Shares (which, if purchased by United or the United Designee under this Section  2.6 , shall be Common Shares) covered by the Kingsland ROFO Offer on the price and terms as set forth in the Kingsland ROFO Offer, which right may be exercised by delivering to Kingsland written notice of exercise thereof substantially in the form attached hereto as Exhibit  O (the “ United Kingsland ROFO Exercise Notice ”) within the United Kingsland ROFO Period. The consummation of such purchase by United of such Kingsland ROFO Shares (the “ United Kingsland ROFO Exercise Closing ”) shall take place at the principal offices of the Company, within 30 days after the delivery of the United Kingsland ROFO Exercise Notice; provided , however , that United may elect in the United Kingsland ROFO Exercise Notice to delay the purchase of all or any portion of the Kingsland ROFO Shares in accordance with the terms and conditions of the Put Option Agreement and the Upside Sharing Agreement (a “ Delayed ROFO Sale ”). United (or the United Designee, as applicable) may include with its United Kingsland ROFO Exercise Notice any representations and warranties it desires Kingsland to provide that are consistent with those set forth in the Put Option Agreement. At the United Kingsland ROFO Exercise Closing, the Put Option Closing Date or the SVP Delay Date, as applicable, Kingsland shall execute and deliver as directed by United (or the United Designee, as applicable), the applicable Transfer Documents and United shall pay to Kingsland the applicable Kingsland ROFO Price by wire transfer of immediately available funds. In addition, and at United’s option, at the United Kingsland ROFO Exercise Closing, the Put Option Closing Date or the SVP Delay Date,

 

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as applicable, Kingsland shall also execute and deliver the Usufruct Documents with respect to the Kingsland ROFO Shares as directed by United. The provisions of Section 2.8 of the Put Option Agreement shall apply, mutatis mutandis , to the purchase by United of the Kingsland ROFO Shares and optional delivery of the Usufruct Documents pursuant to this Section  2.6 .

(c)     Block Trades . To the extent (A) United does not deliver a United Kingsland ROFO Exercise Notice during the United Kingsland ROFO Period and NewCo does not deliver a NewCo Kingsland ROFO Exercise Notice during such period or does not pay the NewCo ROFO Deposit, in each case with respect to all of the Kingsland ROFO Shares that are the subject of a Kingsland ROFO Offer or (B) the Kingsland ROFO Shares that are the subject of a Kingsland ROFO Offer are not purchased by United (or the United Designee, as applicable) or NewCo pursuant to Section  2.6(d) after the date (i) by which the United Kingsland ROFO Exercise Closing or the NewCo Kingsland ROFO Exercise Closing, as applicable, is required to occur in accordance with this Section  2.6 and (ii) on which Kingsland has complied with the procedures set forth in this Section  2.6 and subject to Section  2.8 (the date on which such period expires, the “ Kingsland ROFO Termination Date ”), Kingsland may sell such Kingsland ROFO Shares (1) on the New York Stock Exchange within 60 days after the Kingsland ROFO Termination Date; or (2) on the BVC, within 90 days after the Kingsland ROFO Termination Date in one or more Kingsland Block Trades for the price and on the terms specified in the Kingsland ROFO Offer, or at a Kingsland ROFO Price equal to or greater than the then-prevailing trading price of AVH ADS divided by eight in a transaction that is not conditioned on or coupled with any other transaction and does not include any other material terms or conditions. Notwithstanding the foregoing, if the volume of Preferred Shares which Kingsland intends to sell is greater than 10% of the average daily trading volume, then the applicable term to consummate the Block Trade transaction will be automatically extended as reasonably necessary, but in no event for more than an additional 60 days, to consummate the number of Block Trades required to avoid violating applicable rules regarding trading more than the 10% of the average daily trading volume. If Kingsland fails to sell all of the Kingsland ROFO Shares within such period, then any future proposed Transfers of Kingsland ROFO Shares by Kingsland or Kingsland Block Trade shall remain subject to the other provisions of this Article  2 and, other than with respect to a failed sale due to the decline of the market price of such Kingsland ROFO Shares by more than 15% since the Kingsland ROFO Offer was made, such failed sale shall be deemed to be an exercise by Kingsland of a Kingsland Block Trade under this Section  2.6 .

(d)     NewCo Kingsland ROFO Exercise . If NewCo has paid in full all of its Obligations and NewCo desires to purchase any of the Kingsland ROFO Shares (which shall be Common Shares) covered by the Kingsland ROFO Offer not purchased by United (or the United Designee) on the price and terms as set forth in the Kingsland ROFO Offer, then NewCo shall, during the United Kingsland ROFO Period, deliver to United and Kingsland written notice of exercise (subject to any United Kingsland ROFO Exercise Notice substantially in the form attached hereto as Exhibit  P (the “ NewCo Kingsland ROFO Exercise Notice ”). Contemporaneously with the delivery of the NewCo Kingsland ROFO Exercise Notice, NewCo shall pay to Kingsland, in immediately available funds by wire transfer to an account specified by Kingsland, a non-refundable cash deposit in amount equal to $5,000,000 (the “ NewCo ROFO Deposit ”).

 

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(i)    If (A) NewCo has delivered a NewCo Kingsland ROFO Exercise Notice to Kingsland during the United Kingsland ROFO Period, (B) NewCo has paid the NewCo ROFO Deposit and (C) either (1) United has informed NewCo and Kingsland in writing that it will not deliver a United Kingsland ROFO Exercise Notice, (2) United has not delivered a United Kingsland ROFO Exercise Notice before the expiration of the United Kingsland ROFO Period or (C) United has delivered a United Kingsland ROFO Exercise Notice with respect to less than all of the Kingsland ROFO Shares covered by the Kingsland ROFO Offer, then NewCo shall consummate the purchase by NewCo of all such Kingsland ROFO Shares not purchased by United (the “ NewCo Kingsland ROFO Exercise Closing ”), which NewCo Kingsland ROFO Exercise Closing shall take place at the principal offices of the Company within 30 days after the delivery of the NewCo Kingsland ROFO Exercise Notice. At the NewCo Kingsland ROFO Exercise Closing, Kingsland shall execute and deliver to NewCo the applicable Transfer Documents, and NewCo shall pay to Kingsland (subject to the Upside Sharing Agreement) the Kingsland ROFO Price by wire transfer of immediately available funds less the NewCo ROFO Deposit; provided , however , that if NewCo fails to consummate the purchase of the Kingsland ROFO Shares on the NewCo Kingsland ROFO Exercise Closing, then Kingsland may retain the NewCo ROFO Deposit together with any interest or income thereon, as liquidated damages, free of any claims by NewCo or any other Person with respect thereto.

(ii)    If (1) United has informed NewCo and Kingsland in writing that it will deliver a United Kingsland ROFO Exercise Notice or (2) United delivers a United Kingsland ROFO Exercise Notice before expiration of the United Kingsland ROFO Period with respect to all of the Kingsland ROFO Shares covered by the Kingsland ROFO Offer, then Kingsland shall refund to NewCo the NewCo ROFO Deposit, without any interest accrued thereon, free of any claims by it or any other Person with respect thereto.

Section 2.7     United ’ s Call Right on NewCo ’ s Shares .

(a)    Subject to the provisions of this Section  2.7 , if United does not Control the Company and (i) the Company or any of its Affiliates terminates any Joint Business Agreement, except in the case of a Permitted JBA Termination; (ii) a Joint Business Agreement is terminated, or becomes terminable, by any counterparty or combination of counterparties to such agreement in accordance with its terms, due to a default or breach by the Company or any of its Affiliates of any such agreement; (iii) NewCo exercises its JAA Approval Rights to consent to, approve, or vote in favor of, the termination of any Joint Business Agreement, except in the case of a Permitted JBA Termination, in contravention of this Agreement; or (iv) the Company or any of its Affiliates enters into a Non-Permitted Alliance Arrangement (as defined in the NewCo Loan Agreement), then United may, at its sole option, at any time not more than 180 days following (1) the termination of such Joint Business Agreement or such date on which such Joint Business Agreement becomes terminable, (2) the date on which NewCo consents, approves or votes to terminate such Joint Business Agreement or (3) the entry by the Company or any of its Affiliates into such Non-Permitted Alliance Arrangement, deliver to NewCo a written notice substantially in the form attached hereto as Exhibit  Q (the “ NewCo Call Notice ”), electing, or designating a United Designee to elect, to purchase, and in such event, NewCo shall be obligated to sell, all of NewCo’s Shares, for a purchase price equal to the lower of (A) the Call Price and (B) if the termination of a Joint Business Agreement occurs due to a purported or attempted Transfer of

 

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Shares not in accordance with this Agreement and the JAA, then the purchase price for such Shares in such purported or attempted Transfer (such purchase price, the “ Alternate Call Price ”).

(b)    The NewCo Call Notice shall set forth (i) the Call Price and the Alternate Call Price, if any, and (ii) the anticipated closing date of such transaction, which shall be no earlier than 3 Business Days following the NewCo Call Notice.

(c)    United (or the United Designee, as applicable) and NewCo shall take all actions required to obtain or cause to be obtained any required third party approvals to give effect to this Section  2.7 . NewCo shall Transfer to United (or the United Designee, as applicable) its Shares free and clear of any Liens (other than Liens created by or pursuant to this Agreement or any other Transaction Documents), and if any of the Shares are pledged or used as a guarantee and are subject to any claim whatsoever which may limit their Transferability, then NewCo shall take all actions to release any such Liens to the reasonable satisfaction of United, except for those limits resulting from the Organization Documents of the Company, the JAA and this Agreement. At the time of such Transfer, NewCo shall represent and warrant to United (or the United Designee, as applicable) that NewCo is the record holder and owner of, and holds good and valid title to, all of its Shares and shall make other customary representations and warranties with regard to the Company as reasonably requested by United.

(d)    United (or the United Designee, as applicable) shall pay to NewCo the Call Price or the Alternate Call Price, as applicable, on the closing date set forth in the NewCo Call Notice, which closing date shall not exceed 180 days from the applicable triggering event set forth above in Section  2.7(a) , by wire transfer of immediately available funds to an account specified by NewCo, except that while any Obligations are outstanding, at United’s option, all or portion of such payment may be offset by United against the Obligations. NewCo shall cause the Shares sold pursuant to this Section  2.7 to be delivered to United (or the United Designee, as applicable) at such closing along with the applicable Transfer Documents.

Section 2.8     United ’ s Call Right on Kingsland ’ s Shares .

(a)    Subject to the provisions of this Section  2.8 , if (i) a Kingsland Material Breach occurs and, if curable, is not cured within 30 days following Kingsland’s receipt from United of a written notice thereof, or (ii) (A) the Company or any of its Affiliates terminates a Joint Business Agreement (except in the case of a Permitted JBA Termination), (B) a Joint Business Agreement is terminated, or becomes terminable, by any counterparty or combination of counterparties to such agreement in accordance with its terms, due to a default or breach by the Company or any of its Affiliates of any such agreement, (C) Kingsland consents to, approves, or votes in favor of, the termination of any Joint Business Agreement, except in the case of a Permitted JBA Termination, in contravention of this Agreement, or (D) the Company or any of its Affiliates enters into a Non-Permitted Alliance Arrangement, in each case under clause (ii) , at a time when Kingsland is the Controlling Shareholder of the Company, then United may, at its sole option, at any time not more than 180 days following (1) United’s written notice of the Kingsland Material Breach, (2) the termination of such Joint Business Agreement or such date on which such Joint Business Agreement becomes terminable, (3) the entry by the Company or any of its Affiliates into such Non-Permitted Alliance Arrangement, deliver

 

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to Kingsland a written notice substantially in the form attached hereto as Exhibit  R (the “ Kingsland Call Notice ”), electing, or designating a United Designee to elect, to purchase, and in such event, Kingsland shall be obligated to sell, up to all of Kingsland’s Shares on the terms set forth in this Section 2.8.

(b)    The Kingsland Call Notice shall set forth (i) the Call Price and the Alternate Call Price, if any, and (ii) the anticipated closing date of such transaction, which shall be (x) no earlier than 3 Business Days following the Kingsland Call Notice or (y) if the Kingsland Call Notice is delivered at any time prior to the fifth anniversary of this Agreement, then the anticipated closing date shall be the Put Option Closing Date or the SVP Delay Date, as applicable.

(c)    United (or the United Designee, as applicable) and Kingsland shall take all actions required to obtain or cause to be obtained any required third party approvals to give effect to this Section  2.8 . Kingsland shall Transfer, or cause to be Transferred, to United (or the United Designee, as applicable) its Shares free and clear of any Liens (other than Liens created by or pursuant to this Agreement or any other Transaction Documents), and if any of the Shares are pledged or used as a guarantee and are subject to any claim whatsoever which may limit their Transferability, then Kingsland shall take all actions to release any such Liens to the reasonable satisfaction of United, except for those limits resulting from the Organization Documents of the Company or the Transaction Documents. At the time of such Transfer, Kingsland shall represent and warrant to United (or the United Designee, as applicable) that Kingsland is the record holder and owner of, and holds good and valid title to, all of its Shares and shall make other customary representations and warranties with regard to the Company as reasonably requested by United.

(d)    If the Call Price or the Alternate Call Price, as applicable, is less than $1.50 per Share (as adjusted for the occurrence of any Adjustment Events) and (i) if Article 2 of the Put Option Agreement remains in effect with respect to Kingsland’s Shares, then the Transfer of Kingsland’s Shares shall occur, and the consideration therefor shall be calculated and paid, in accordance with the Put Option Agreement, the Cooperation Agreement and the Upside Sharing Agreement or (ii) Article 2 of the Put Option Agreement has been terminated with respect to Kingsland’s Shares, then the Transfer of Kingsland’s Shares shall occur as provided in this Section 2.8 and the consideration therefor shall be the Call Price or the Alternate Call Price, as applicable.

(e)    If the Call Price or the Alternate Call Price, as applicable, is equal to or more than $1.50 per Share (as adjusted for the occurrence of any Adjustment Events) then the Call Price or the Alternate Call Price, as applicable, shall be the amount of the consideration paid, and such amount shall be paid to Kingsland, and the Transfer of Kingsland’s Shares shall occur on the date specified in Section 2.8(d), provided that if the Upside Sharing Agreement has been executed and delivered by Kingsland and United, such amount shall be paid, and such Shares shall be Transferred, in accordance with the Upside Sharing Agreement.

Section 2.9     NewCo Purchase Rights .

(a)     NewCo Right of First Refusal .

(i)     United Purchase Offer . Subject to Section  2.1 , if, at any time, and from time to time, a United Seller receives a Bona Fide Offer from a Third-Party Purchaser to Transfer all or any portion of the Common Shares owned by such United Seller (such Shares proposed to be sold in connection with such Bona Fide Offer, the “ United ROFR Shares ”), and such United Seller intends to accept such Bona Fide Offer, then, provided that (A) NewCo has paid in full all of its Obligations, (B) the NewCo Group owns at least a majority of the outstanding Common Shares and (C) the purchase price set forth in such Bona Fide Offer is equal to or greater than the United Blended Share Price, then NewCo shall have the rights set forth in this Section  2.9(a) with respect to the United ROFR Shares. If all of the foregoing conditions are

 

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satisfied, the United Seller shall deliver to NewCo, no later than 15 days prior to accepting such Bona Fide Offer, an offer substantially in the form attached hereto as Exhibit S (a “ United Purchase Offer ”) to sell to NewCo all of the United ROFR Shares, which United Purchase Offer shall (1) be in writing; (2) set forth the same purchase price as is set forth in the Bona Fide Offer, payable on the same terms as set forth in the Bona Fide Offer; and (3) include (x) financing terms, (y) other terms and conditions as are set forth in the Bona Fide Offer, in each case, that are at least as favorable to NewCo as those contained in the Bona Fide Offer are to such Third-Party Purchaser and (z) a copy of any executed purchase agreement (or other type of arrangement) with such Third-Party Purchaser or, if no such agreement (or arrangement) exists, then a copy of any purchase agreement (or other type of arrangement) submitted or offered by such Third-Party Purchaser in connection with the Bona Fide Offer. Notwithstanding the foregoing, if the Fair Market Price Per Share on the date of such Bona Fide Offer is less than the United Blended Share Price, then the provisions of this Section  2.9(a) shall not apply and the provisions of Section  2.9(b) shall apply to any Transfers of Shares by the United Group after NewCo has paid all of its Obligations in full.

(ii)     Exercise . During the 10 Business Day-period following the receipt by NewCo of the United Purchase Offer (the “ NewCo ROFR Offer Period ”), NewCo shall have the right, at its sole option and at any time prior to the expiration of the NewCo ROFR Offer Period, to accept such United Purchase Offer on the price and terms set forth in the United Purchase Offer, which right may be exercised by giving irrevocable written notice of exercise thereof substantially in the form attached hereto as Exhibit T (a “ NewCo Notice of Exercise ”) to the United Seller and by tendering performance at the principal offices of the Company, within 20 Business Days after the delivery of the NewCo Notice of Exercise (the “ NewCo ROFR Closing ”). At the NewCo ROFR Closing, the United Seller shall cause the United ROFR Shares to be delivered to NewCo, along with the applicable Transfer Documents.

(iii)     Closing . Subject to Section  2.1 , after the United Seller has complied with the procedures set forth in this Section  2.9(a) and if NewCo fails to deliver a NewCo Notice of Exercise during the NewCo ROFR Offer Period, or NewCo fails to purchase the United ROFR Shares within the time period set forth in Section  2.9(a)(ii) , then the United Seller may sell such United ROFR Shares within 90 days (which such 90-day period may be extended for a reasonable time to the extent reasonably necessary to obtain any necessary governmental or regulatory approvals) after expiration of the NewCo ROFR Offer Period to the Third-Party Purchaser for the price and on the terms specified in the Bona Fide Offer, or at a price equal to or greater than the price specified in the Bona Fide Offer, with financing terms no more favorable to the Third-Party Purchaser than those set forth in the Bona Fide Offer and on other terms and conditions that are not more favorable to the Third-Party Purchaser than the terms and conditions set forth in the Bona Fide Offer. If the United Seller fails to complete such a transaction with such Third-Party Purchaser within such 90-day period (which such 90-day period may be extended for a reasonable time to the extent reasonably necessary to obtain any necessary governmental or regulatory approvals), the United Seller shall again be required to comply with the procedures of this Section  2.9(a) with respect to any proposed such (or any future) Bona Fide Offer. Promptly following the consummation of such transaction, the United Seller shall notify NewCo of the consummation thereof and shall furnish evidence of the completion of such sale and of the terms thereof as may reasonably requested by NewCo.

 

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(iv)     Conditions . The United Seller shall, at least 5 Business Days prior to the closing of the sale of United ROFR Shares to a Third-Party Purchaser, deliver to the Company and NewCo a written certificate executed by an officer of such United Seller in substantially the form attached hereto as Exhibit U (A) specifying that (1) United Seller has complied in all respects with the terms and conditions of this Section  2.9(a) including this Section  2.9(a)(iv) , and if applicable, has offered NewCo the ability to match the terms set forth in the United Seller’s agreement with the Third-Party Purchaser, but such offer was not accepted by NewCo as set forth, and within the period specified, below and (B) the sale is in compliance with Section  2.1 ; and (C) attaching a copy of the executed purchase agreement with the Third-Party Purchaser, which purchase agreement (or other type of arrangement) shall include a condition precedent that United Seller shall have fully complied with the provisions of this Section  2.9(a) . If the terms of the United Seller’s agreement with the Third-Party Purchaser are more favorable to the Third-Party Purchaser than those set forth in the Bona Fide Offer, then in order to avoid violating the provisions of Section  2.9(a)(iii) , in lieu of United Seller’s being required to comply again with all the provisions of this Agreement, including this Section  2.9(a) , with respect to the enhanced Bona Fide Offer, the United Seller shall provide prior written notice to NewCo substantially in the form attached hereto as Exhibit V (the “ NewCo Matching Notice ”) at least 30 Business Days prior to the closing of the sale of the United ROFR Shares to a Third-Party Purchaser detailing with reasonable specificity any material terms or conditions in the United Seller’s agreement (written or oral) with the Third-Party Purchaser that are more favorable than those specified in the original Bona Fide Offer. NewCo shall have the right to match the terms set forth in the NewCo Matching Notice by delivering written notice to the United Seller within 10 Business Days following the date that the NewCo Matching Notice is delivered to NewCo. If NewCo exercises its right to match the Third-Party Purchaser’s offer as set forth above, such transaction between the United Seller and NewCo shall be closed, on terms matched by NewCo, within 15 days following the date of the notice delivered by NewCo to the United Seller (which such 15-day period may be extended for a reasonable time to the extent reasonably necessary to obtain any necessary governmental or regulatory approvals).

(b)     NewCo Right of First Offer .

(i)     Purchase Offer . Subject to Section  2.1 , if, at any time, and from time to time, either (A) a United Seller elects to sell its Common Shares and the Fair Market Price Per Share on the date of such election by United is less than the United Blended Share Price, or (B) without regard to the Fair Market Price Per Share, a United Seller intends to convert its Common Shares into Preferred Shares and sell them on a securities exchange (such conversion to occur immediately prior to any such proposed sale but after all of the requirements and time periods set forth in Section  2.9(b)(ii) have been satisfied) or to a Third Party Purchaser (such Common Shares to be sold or converted, the “ United ROFO Shares ”) and (x) NewCo has paid in full all of its Obligations, and (y) the NewCo Group owns at least a majority of the outstanding Common Shares, then NewCo shall have the rights set forth in this Section  2.9(b) with respect to the United ROFO Shares. Such United Seller shall deliver a notice of its intention to sell or convert its Shares to NewCo, which notice will include (1) the number of Shares to be sold or converted by such United Seller (the “ United Sale Notice ”) and (2) a request for NewCo to specify the purchase price and other terms and conditions of, and on which, NewCo proposes to purchase the United ROFO Shares.

 

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(ii)     NewCo United ROFO Exercise . During the 20-day period following the receipt by NewCo of the United Sale Notice (the “ NewCo United ROFO Period ”), NewCo shall have the right to make an offer to purchase all, but not less than all, of the United ROFO Shares covered by the United Sale Notice (a “ NewCo United ROFO Offer ”), which NewCo United ROFO Offer shall (1) be in writing; (2) set forth a purchase price all in cash (the “ NewCo United ROFO Price ”); and (3) not be conditioned on or coupled with any other transaction and shall not include any other material terms or conditions. The United Seller will have 10 days from the date it receives the NewCo United ROFO Offer (the “ United Election Period ”) to elect, in writing, to either accept or reject the NewCo United ROFO Offer (the “ United Election Notice ”). If NewCo elects not to deliver a NewCo United ROFO Offer or fails to deliver a NewCo United ROFO Offer prior to expiration of the NewCo United ROFO Period, then the United Seller may sell, if it elects to proceed with the sale at all, all of the United ROFO Shares to a Third-Party Purchaser, convert the United ROFO Shares to Preferred Shares and/or or sell such Preferred Shares on a securities exchange or to a Third-Party Purchaser at any price that is lower than the United Blended Share Price and on any other terms for a period of 90 days following the expiration of the NewCo United ROFO Period; provided, however , that if any Third-Party Purchaser or counterparty in a sale effectuated on a securities exchange offers to purchase, or the United Seller intends to offer to sell, such United ROFO Shares at a price that is equal to or greater than the United Blended Share Price, United must first comply with the provisions of Section  2.9(a) .

(iii)     Closing . If the United Seller elects to accept the NewCo United ROFO Offer, then NewCo shall purchase the United ROFO Shares on the terms set forth in the NewCo United ROFO Offer within 15 days following receipt by NewCo of the United Election Notice. If the United Seller elects to reject the NewCo United ROFO Offer or does not deliver a United Election Notice prior to expiration of the United Election Period, then the United Seller may sell the United ROFO Shares to a Third-Party Purchaser, convert the United ROFO Shares to Preferred Shares and sell such Preferred Shares on a securities exchange or to a Third-Party Purchaser, in each case at a purchase price not less than the NewCo United ROFO Price in a transaction that is not conditioned on or coupled with any other transaction and does not include any other material terms or conditions. The consummation of such purchase by such Third-Party Purchaser of such United ROFO Shares shall take place within 90 days after the delivery of the United Election Notice or the expiration of United Election Period. If any United ROFO Shares are not purchased by NewCo after the date by which NewCo is required to purchase the United ROFO Shares in accordance with this Section  2.9(a)(iii) , the United Seller may sell the applicable United ROFO Shares within 90 days after such date. If the United Seller fails to sell all of the United ROFO Shares within such 90-day period, then any Transfers of United’s Shares that are subject to this Section  2.9 shall remain subject to this Section  2.9 .

(c)     Unrestricted Transfers . For the avoidance of doubt, notwithstanding anything in this Section  2.9 to the contrary, (i) no Transfer of any Shares by a member of the United Group will be subject to any of the restrictions in this Section  2.9 for so long as NewCo remains obligated to pay any Obligations and (ii) this Section  2.9 shall not apply to any sale of Preferred shares (including any Preferred Shares into which any Common Shares held by the United Group are converted) by a United Seller.

 

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ARTICLE 3

RIGHTS AND DUTIES OF THE PARTIES

Section 3.1     Voting Restrictions . Neither NewCo nor Kingsland shall vote its Shares at any regular or special meeting of shareholders or in any written consent executed in lieu of such a meeting in favor of the termination by the Company or any of its Affiliates of a Joint Business Agreement, except in the case of a Permitted JBA Termination.

Section 3.2     Effect Agreement ; Legends .

(a)     Voting to Effect this Agreement . Each of NewCo and Kingsland shall vote its Shares at any regular or special meeting of shareholders or in any written consent executed in lieu of such a meeting, and shall take all other actions necessary, to amend the JAA and the Company’s Organization Documents, including the Company Charter, to give effect to, and reflect the agreements contained in, this Agreement and to ensure that the Company’s Organization Documents (including the Company Charter) and the JAA do not conflict in any respect with the provisions of this Agreement.

(b)     Legends . The share certificates representing the Shares, when delivered to United (or a United Designee, as applicable) or the Collateral Agent by either NewCo or Kingsland, shall have no restrictive legends or other restrictive language affixed thereto, and no restrictions shall exist in relation to the voting rights associated with, or upon the Transfer of, any of the Shares, except as set forth in this Agreement and the JAA, the Company Charter or under applicable Law or any such restrictions created by Contracts to which United or any of its Affiliates are a party.

Section 3.3     JAA Matters .

(a)     Special Approval Matters .

(i)     JAA Consent Rights . From the date hereof, Kingsland irrevocably grants to the Independent Third Party (or, following the delivery by United of a United Approval Notice, United) all rights to exercise (or not exercise or waive) all Delegated Rights (including JAA Approval Rights and JAA Veto Rights) pursuant to, and in accordance with, this Agreement and the JAA.

(ii)     JAA Consent Rights Prior to Year  10. Prior to the tenth anniversary of the Effective Date, only if NewCo has paid in full all of its Obligations, the following will apply:

(A)    If there is not a United Ownership Threshold Failure on the date that a Special Approval Matter is submitted to NewCo and the Independent Third Party (or, following the delivery, if any, by United of a United Approval Notice, United) for approval in accordance with the JAA (a “ Special Approval Request Date ”), then the Independent Third Party (or, following the delivery, if any, by United of a United Approval Notice, United) shall have the right to exercise all of its JAA Approval Rights.

(B)    If there is a United Ownership Threshold Failure on a Special Approval Request Date, then the Independent Third Party (or, following the delivery, if any, by United of a United Approval Notice, United) shall have the right to exercise the Fundamental JAA Approval Rights only, but not any other JAA Approval Rights.

 

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(C)    If there is not a NewCo Ownership Threshold Failure on a Special Approval Request Date, then NewCo shall have the right to exercise all of its JAA Approval Rights.

(D)    If there is a NewCo Ownership Threshold Failure on a Special Approval Request Date, then NewCo shall have the right to exercise the Fundamental JAA Approval Rights only, but not any other JAA Approval Rights.

(iii)     NewCo Buy-Out Rights Prior to Year  10 . Subject to Section  3.3(a)(vi) , prior to the tenth anniversary of the Effective Date, if the Independent Third Party (or, following the delivery, if any, by United of a United Approval Notice, United) exercises its JAA Veto Rights for any matter other than a Fundamental JAA Approval Right, then NewCo shall have the right to make, within 30 days after the Independent Third Party (or, following the delivery, if any, by United of a United Approval Notice, United) exercises such JAA Veto Right, a Bona Fide Offer in writing to United (or the United Designee, as applicable) substantially in the form attached hereto as Exhibit  W (the “ NewCo Buy-Out Offer ”), to purchase all (but not less than all) of the Shares owned by the United Group (subject to clause (E) below) (the “ NewCo Buy- Out Right ”) at a price per Share equal to the Fair Market Price Per Share and such NewCo Buy-Out Offer shall include evidence satisfactory to United that NewCo has and will have immediately available funds to purchase all (but not less than all) of the Shares owned by the United Group; provided , however , that NewCo will have the right to purchase all but one Share owned by the United Group in connection with such NewCo Buy-Out Right.

(A)    The NewCo Buy-Out Offer shall set forth the Fair Market Price Per Share and the anticipated NewCo Buy-Out Closing Date. United (or the United Designee, as applicable) may accept or reject such NewCo Buy-Out Offer in its sole and absolute discretion and shall reply in writing to such NewCo Buy-Out Offer within 30 days following receipt thereof, and any failure of United (or the United Designee, as applicable) to reply in writing to such NewCo Buy-Out Offer within such time shall be deemed to be a rejection of such NewCo Buy-Out Offer by United (or the United Designee, as applicable); provided , however , the Independent Third Party (or, following the delivery, if any, by United of a United Approval Notice, United) shall have the right to revoke such exercise of its JAA Veto Rights by delivering to NewCo written notice at any time prior to the NewCo Buy-Out Closing Date and, upon (i) the rejection of such NewCo Buy-Out Offer or (ii) the revocation of such exercise of its JAA Veto Rights for which NewCo delivers a NewCo Buy-Out Offer, NewCo will no longer have the right to exercise its NewCo Buy-Out Right with respect to such exercise of JAA Veto Rights, and the Independent Third Party (or, following the delivery, if any, by United of a United Approval Notice, United) will not have the right to veto the Special Approval Matter for which the Independent Third Party or United exercised its JAA Veto Rights if the exact same matter is promptly (but in any event within 90 Business Days following delivery of the NewCo Buy-Out Offer) resubmitted to the Board.

 

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(B)    If United (or the United Designee, as applicable) accepts such NewCo Buy-Out Offer, (1) on a date agreed upon by NewCo and United, but not later than 90 days after United receives the NewCo Buy-Out Offer (the “ NewCo Buy-Out Closing Date ”), NewCo and the United Group will cause the closing of the purchase of the Shares owned by the United Group as of the NewCo Buy-Out Closing Date (except for one Share) and (2) on the NewCo Buy-Out Closing Date, NewCo shall pay to United (or the United Designee, as applicable) a price per Share equal to the Fair Market Price Per Share set forth on the NewCo Buy-Out Offer by wire transfer of immediately available funds to an account specified by United (or the United Designee, as applicable). United (or the United Designee, as applicable) shall cause the Shares sold pursuant to this Section  3.3(a)(iii)(B) to be delivered to NewCo at such closing along with the applicable Transfer Documents.

(C)    If a Party fails to close on the NewCo Buy-Out Closing Date, then the other Party shall be entitled (i) (without proof of actual damages or otherwise or posting or securing any bond) to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement and (ii) to be indemnified for all losses and damages resulting from such failure, including attorney fees.

(D)    If NewCo consummates the NewCo Buy-Out Right pursuant to this Section  3.3(a)(iii) , then following such consummation the Independent Third Party (or, following the delivery, if any, by United of a United Approval Notice, United) shall be entitled to exercise JAA Approval Rights determined in accordance with the provisions of Section  3.3(a)(ii). If United rejects a valid NewCo Buy-Out Offer pursuant to this Section  3.3(a)(iii) , then, following such rejection, the Independent Third Party (or, following the delivery, if any, by United of a United Approval Notice, United) shall be entitled to exercise JAA Approval Rights determined in accordance with the provisions of Section  3.3(a)(ii) but calculated as if such NewCo Buy-Out Offer (as amended, if applicable) had been accepted and the NewCo Buy-Out Right had been consummated. Upon the termination of the JAA, if the United Group has retained only a single Share for purposes of exercising the Fundamental JAA Approval Rights, then the United Group will transfer to NewCo the single remaining Share owned by the United Group at such time for no additional consideration, along with the applicable Transfer Documents.

(E)    If, at the time of delivery of any NewCo Buy-Out Offer that United accepts or intends to accept, (x) Kingsland has Exercised or been deemed to have Exercised the Put Option with respect to any or all of the Put Shares, (y) Article 2 of the Put Option Agreement has been terminated with respect to all Put Shares for which the Put Option has not been exercised, and (z) United has not made a Share Value Payment (as defined in the Put Option Agreement) to Kingsland pursuant to the Put Option Agreement and is not obligated to do so until the SVP Delay Date, then, within five Business Days following the delivery to United of the NewCo Buy-Out Offer, United shall deliver a notice to NewCo substantially in the form attached hereto as Exhibit  Z (the “ Put Shares Buy-Out Notice ”) which notice will include

 

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(1) a statement by United that it has elected to delay the Put Option Closing until the SVP Delay Date, (2) the number of Put Shares with respect to which the Put Option has been Exercised or been deemed to have Exercised and (3) an offer to sell all (but not less than all) of the Put Shares for which the Put Option was Exercised or deemed Exercised at a price per Share equal to the Fair Market Price Per Share (“ Put Shares Buy-Out Offer ”). NewCo shall have the right (the “ NewCo Put Shares Buy-Out Right ”) to accept such Put Shares Buy-Out Offer, within 10 days after the delivery of the Put Shares Buy-Out Notice, which acceptance shall include evidence satisfactory to United and Kingsland that NewCo has and will have immediately available funds to purchase all (but not less than all) of the Put Shares owned by the Kingsland Group. If NewCo accepts such Put Shares Buy-Out Offer, then, in addition to the matters set forth in Section  3.3(iii)(B) , on the NewCo Buy-Out Closing Date (1) the Kingsland Group and the United Group will cause the closing of the purchase by United of the Put Shares from Kingsland, (2) NewCo and the United Group will cause the closing of the purchase by NewCo of the Put Shares from United, and (3) NewCo shall pay to an account specified by United an amount equal to the product of (I) the Fair Market Price Per Share set forth on the Put Shares Buy-Out Offer, multiplied by (II) the aggregate number of Put Shares subject to the Put Shares Buy-Out Right. United shall cause the Put Shares sold pursuant to this Section  3.3(a)(iii)(E) to be delivered to NewCo at such closing along with the applicable Transfer Documents. If NewCo (a) fails to reply in writing to such Put Shares Buy-Out Notice within 10 days after the delivery of the Put Shares Buy-Out Notice or (b) rejects such Put Shares Buy-Out Offer, then, NewCo shall retain the right to exercise the NewCo Put Shares Buy-Out Right with respect to any subsequent NewCo Buy-Out Offer that United accepts or intends to accept. Nothing in this Section 3.3(a)(iii)(E) shall modify the payment obligations of United or NewCo under the Cooperation Agreement.

(iv)     JAA Consent Rights After Year  10. After the tenth anniversary of the Effective Date, only if NewCo has paid in full all of its Obligations, the following will apply:

(A)    If there is not a United Ownership Threshold Failure on the Special Approval Request Date, then the Independent Third Party (or, following the delivery, if any, by United of a United Approval Notice, United) shall have the right to exercise all of its JAA Approval Rights.

(B)    If there is a United Ownership Threshold Failure on a Special Approval Request Date, then the Independent Third Party (or, following the delivery, if any, by United of a United Approval Notice, United) shall have the right to exercise the Fundamental JAA Approval Rights only, but not any other JAA Approval Rights.

(C)    If there is not a NewCo Ownership Threshold Failure on a Special Approval Request Date, then NewCo shall have the right to exercise of its JAA Approval Rights.

 

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(D)    If there is a NewCo Ownership Threshold Failure on a Special Approval Request Date, then NewCo shall have the right to exercise the Fundamental JAA Approval Rights only, but not any other JAA Approval Rights.

(v)     NewCo Buy-Out Rights After Year  10 . Subject to Section  3.3(a)(vi) , after the tenth anniversary of the Effective Date, if the Independent Third Party (or, following the delivery, if any, by United of a United Approval Notice, United) exercises its JAA Veto Rights, then NewCo shall have the right to exercise the NewCo Buy-Out Right in accordance with, and to the extent permitted under Section  3.3(a)(iii) other than clause (D)  thereof; provided , however , that NewCo shall have the right to terminate the JAA upon any rejection or deemed rejection by United (or the United Designee, as applicable) of such NewCo Buy-Out Offer; provided further , however , the Independent Third Party (or, following the delivery, if any, by United of a United Approval Notice, United) shall have the right to revoke such exercise of its JAA Veto Rights by delivering to NewCo written notice at any time prior to the NewCo Buy-Out Closing Date and, upon (i) the rejection of such NewCo Buy-Out Offer or (ii) the revocation of such exercise of its JAA Veto Rights for which NewCo delivered a NewCo Buy-Out Offer, NewCo will no longer have the right to exercise its NewCo Buy-Out Right with respect to such exercise of JAA Veto Rights, and the Independent Third Party (or, following the delivery, if any, by United of a United Approval Notice, United) will not have the right to veto the Special Approval Matter for which the Independent Third Party or United exercised its JAA Veto Rights if the exact same matter is promptly (but in any event within 90 Business Days following delivery of the NewCo Buy-Out Offer) resubmitted to the Board.

(vi)     NewCo Buy-Out Rights Limitation. Notwithstanding anything herein to the contrary, NewCo will not have any rights to purchase any Shares owned by the United Group or to exercise the NewCo Buy-Out Right (A) prior to the payment in full by NewCo of its Obligations, (B) for so long as an Event of Default has occurred and is continuing, (C) if NewCo or any of its Affiliates has breached its material obligations under a Joint Business Agreement, this Agreement or the JAA, which breach has not been waived or cured, if capable of being cured, or (D) unless the NewCo Group owns, at such time of exercise and until the completion of the exercise of any NewCo Buy-Out Right pursuant to Section  3.3(a)(iii) or Section  3.3(a)(v) , more Common Shares than the United Group.

(vii)     United Buy-Out Rights . If (x) NewCo exercises its JAA Veto Rights and (y) the United Group owns, at such time of exercise and until the completion of any United Buy-Out Right pursuant to this Section  3.3(a)(vii) , more Common Shares than the NewCo Group, then United (or if designated by United, the United Designee) shall have the right ( provided that United or any of its Affiliates has not breached its material obligations under any Transaction Document to which it is a party and such breach has not been waived or cured, if capable of being cured) to make, within 30 days after NewCo exercises such JAA Veto Right, a Bona Fide Offer in writing to NewCo substantially in the form attached hereto as Exhibit  X (the “ United Buy-Out Offer ”) to purchase all (but not less than all) Shares owned by the NewCo Group (the “ United Buy-Out Right ”) at a price per Share equal to the Fair Market Price Per Share and such United Buy-Out Offer shall include evidence satisfactory to NewCo that United has and will have immediately available funds to purchase all (but not less than all) of the Shares owned by the NewCo Group.

 

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(A)    The United Buy-Out Offer shall set forth the Fair Market Price Per Share and the anticipated United Buy-Out Closing Date. NewCo may accept or reject such offer in its sole and absolute discretion and shall reply to such offer within 30 days following the receipt thereof, and any failure of NewCo to reply to such offer within such time shall be deemed to be a rejection of such offer by NewCo. United shall have the right to terminate the JAA upon any rejection by NewCo of such offer, as applicable; provided , however , NewCo shall have the right to revoke such exercise of its JAA Veto Rights by delivering to United written notice at any time prior to the United Buy-Out Closing Date and, upon (i) the rejection of such United Buy-Out Offer or (ii) the revocation of such exercise of its JAA Veto Rights for which United delivered a United Buy-Out Offer, United will no longer have the right to exercise its United Buy-Out Right with respect to such exercise of JAA Veto Rights, and NewCo will not have the right to veto the Special Approval Matter for which it exercised its JAA Veto Rights if the exact same matter is promptly (but in any event within 90 Business Days following delivery of the United Buy-Out Offer) resubmitted to the Board.

(B)    If NewCo accepts such United Buy-Out Offer, (1) United (or the United Designee, as applicable) and the NewCo Group will cause the closing of the purchase of the Shares owned by the NewCo Group to occur no later than 90 days after NewCo receives the United Buy-Out Offer (the “ United Buy-Out Closing Date ”) and (2) on the United Buy-Out Closing Date, United (or the United Designee, as applicable) shall pay to NewCo a price per Share equal to the Fair Market Price Per Share set forth on the United Buy-Out Offer by wire transfer of immediately available funds to an account specified by NewCo. NewCo shall cause the Shares sold pursuant to this Section  3.3(a)(vii) to be delivered to United (or the United Designee, as applicable) at such closing along with the applicable Transfer Documents.

(C)    If a Party fails to close on the United Buy-Out Closing Date, then the other Party shall be entitled (1) (without proof of actual damages or otherwise or posting or securing any bond) to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement and (2) to be indemnified for all losses and damages resulting from such failure, including attorney fees.

(D)    If NewCo rejects a valid United Buy-Out Offer pursuant to this Section 3.3(a)(vii), then, following such rejection NewCo shall be entitled to exercise JAA Approval Rights determined in accordance with the provisions of Section 3.3(a)(ii) but calculated as if such United Buy-Out Offer (as amended, if applicable) had been accepted and the United Buy-Out Right had been consummated.

(b)     United Approval Notice . At such time, if ever, as United determines, in its sole and absolute discretion as among the Parties and the Independent Third Party, that the exercise by United or a United Designee of any Delegated Rights including the rights and authority of the Independent Third Party pursuant to Section  3.3(a) and Section  3.9 or otherwise under the JAA or the Company Charter would not constitute “control” within the meaning of such term in any of United’s collective bargaining agreements or other material agreements (it being understood that the interpretation of such agreements is a matter between United and the respective counterparties to such agreements) or that United is otherwise prepared to exercise any or all such rights and authority, then United shall so notify Kingsland, NewCo and the Company, and, upon delivery of such notice substantially in the form attached hereto as Exhibit  Y , which notice will identify (as determined and elected by United) the rights and authority to which United will succeed (each such notice, a “ United Approval Notice ”), United shall automatically succeed to each of such rights and authority identified in such United Approval notice without any further amendment of this Agreement, the JAA or the Company Charter.

 

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(c)     United’s Voting Rights . Notwithstanding anything in this Agreement or the JAA to the contrary, United does not intend to exercise any of its rights under this Agreement, (including its rights set forth in Section  2.3 to 2.8 , Section  3.3(a) and the Delegated Rights), the JAA (including the Delegated Rights) or the Company Charter with respect to the acquisition of, exercise of rights with respect to, or Transfer of ownership or voting of, Shares if doing so would constitute “control” within the meaning of such term in any of its collective bargaining agreements or other material agreements (it being understood that the interpretation of such agreements is a matter between United and the respective counterparties to such agreements). For the avoidance of doubt, the immediately preceding sentence shall not relieve United of its obligations or prohibit a United Designee or the Independent Third Party from exercising United’s rights arising under this Agreement, the JAA or the Company Charter.

(d)     JAA Amendment . Notwithstanding anything in the JAA or this Agreement to the contrary, neither NewCo nor Kingsland shall amend or agree to an amendment of the JAA without United’s prior written consent.

Section 3.4     Conversion Restrictions .

(a)    Until such time that NewCo has paid in full all of its Obligations, except in connection with a NewCo Block Trade or Kingsland Block Trade effectuated in accordance with Section  2.5 or Section  2.6 , no member of the NewCo Group or the Kingsland Group shall voluntarily convert any of its Common Shares into Preferred Shares or other form of convertible security, without United’s prior written consent. After such time that NewCo has paid in full all of its Obligations, the NewCo Group and the Kingsland Group ( provided that Kingsland has not Exercised or been deemed to have Exercised the Put Option with respect to all Put Shares) shall have the right to voluntarily convert any of its Common Shares into Preferred Shares or other form of convertible security, without United’s prior written consent; provided, however , that notwithstanding the foregoing, no member of the NewCo Group or the Kingsland Group may convert any of its Common Shares into Preferred Shares or other form of convertible security if such conversion would otherwise (x) cause all of the Preferred Shares to have voting rights pursuant to the Company’s Organization Documents or (y) cause Synergy and Kingsland to lose Control of the Company.

(b)    United (or the United Designee, as applicable), shall have the right to voluntarily convert any of its Common Shares into Preferred Shares or other form of convertible security, without NewCo’s or Kingsland’s prior written consent, and to the extent that a shareholders meeting, regular or special, or any written consent from NewCo or Kingsland is required to approve such conversion pursuant to the Company’s Organization Documents, each of NewCo and Kingsland hereby agree to vote its Shares at any regular or special meeting of shareholders or in any written consent executed in lieu of such a meeting approving United’s or a United Designee’s right to effect such conversion of Common Shares to Preferred Shares.

Section 3.5     Intentionally Omitted .

 

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Section 3.6     Compliance with JBA Integrity Provisions . NewCo acknowledges that it has read each of (a) Article 11 of the Primary JBA; (b) Section 1 of the Commitment Letter by and among Synergy, United, Compañía Panameña de Aviación, S.A. and Aerorepública S.A.; and (c) Section 2 of the Commitment Letter and Guaranty by and among the Company, United, Compañía Panameña de Aviación, S.A. and Aerorepública S.A., and agrees that it shall cause each of its wholly owned Affiliate airlines, and will use its best efforts to cause its non-wholly owned Affiliate airlines, not to publish for sale any JBA Itineraries (as defined in the Primary JBA) or operate any segment of a JBA Itinerary, in each case during the term of the Joint Business Agreements, that would breach the agreements described in clauses  (a) , (b) and (c)  above, as applicable.

Section 3.7     Confidentiality . Each Party agrees to, and to cause its respective Affiliates, officers, directors, employees, accountants, consultants, advisors, and agents (collectively, “ Representatives ”) to, keep confidential all documents and information, oral and written, concerning the Parties, including information about the proposed or potential business strategy, operations, financial matters and other matters relating to the Company or the other Parties (irrespective of the form of communication and whether such information is furnished before, on or after the date of this Agreement), including the subject matter and content of the Transaction Documents and/or of any other agreements or instruments related hereto or cited herein, any other documents and information related to the Company or the other Parties (all such information, the “ Confidential Information ”) and shall not, and shall not permit its Representatives to disclose any of the Confidential Information, or to allow third parties to access the Confidential Information; provided , however , that each Party agrees that (i) the other Parties may disclose Confidential Information to any Independent Third Party, any United Designee, any Monitor (as defined in the NewCo Loan Agreement), the Independent Accountant, the Independent Banker (as defined in the NewCo Loan Agreement) and their respective Representatives, (ii) United may disclose Confidential Information to its assignee and to the authorized representatives of its labor unions (subject to their confidentiality obligations with United), and (iii) the other Parties may disclose Confidential Information to their respective Representatives to the extent reasonably necessary to exercise their respective rights or perform their respective obligations under this Agreement or any of the other Transaction Documents, provided that, in the case of clauses  (i) and (ii)  above, such Independent Third Party, United Designee, Monitor, Independent Banker, assignee or Representative, as applicable, is informed of the confidential nature of the Confidential Information and agrees in writing to abide by the provisions of this Section  3.7 or enters into a confidentiality agreement with the parties containing confidentiality provisions that are no less restrictive than the provisions set forth in this Section  3.7 . The limitations set forth in this Section  3.7 do not apply when such Confidential Information (a) is in the public domain through no breach of this Section  3.7 ; (b) becomes public knowledge through no breach of this Section  3.7 ; (c) is disclosed to meet a legal requirement or in connection with any legal proceeding or to comply with a decision by a court or Governmental Authority, so long as (i) the disclosing Party promptly notifies the other Parties in writing of the order or demand received, (ii) the disclosing Party seeks confidential treatment for the Confidential Information and (iii) the disclosing Party discloses only such Confidential Information that such disclosing Party’s counsel advises is required to be disclosed; (d) is disclosed to meet the disclosure requirements of capital markets regulations, stock exchange rules and applicable Laws; (e) is authorized in writing by the other Parties to be disclosed; (f) is received from a third party who, to the receiving Party’s knowledge, is not subject to any confidentiality obligations to the disclosing Party; or (g) is independently developed by the

 

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disclosing Party without reference to any Confidential Information. This Agreement supersedes the Kingsland NDA, the AVH United NDA and the Synergy United AVH NDA. All oral and written information exchanged between the Parties under those agreements (irrespective of the form of communication and whether such information is furnished before, on or after the date of this Agreement) shall be deemed Confidential Information hereunder and shall be subject to the terms of this Section  3.7 .

Section 3.8     Press Releases . No Party shall issue any press release or other public disclosure using the name, logo or otherwise referring to the other Parties or any of their respective Affiliates or this Agreement or any of the other Transaction Agreements, or otherwise in connection with the transactions contemplated hereby or thereby, without the prior written consent of the other Parties; provided that each Party shall be free to issue such press releases and make such disclosures as may be necessary to comply with applicable Laws and any applicable stock exchange rules; provided , further , however , that, to the extent practicable, each Party shall provide the other Parties a draft of such press release or disclosure in advance of its release and, if practicable, an opportunity to offer comments, which comments such first Party shall have no obligation to accommodate or reflect in such press release or disclosure (it being understood that, in the case of disclosures required for United or the Company to comply with U.S. Securities and Exchange regulations and stock exchange rules, such practicable opportunity for Kingsland, NewCo or United, as applicable, to comment on United’s or the Company’s draft disclosures may from time to time be limited or non-existent).

Section 3.9     Independent Third Party .

(a)    From the date hereof and until the earlier of (i) the delivery by United of a United Approval Notice with respect to all Delegated Rights, and (ii) the later of (A) payment in full by NewCo of all Obligations and (B) the termination of the JAA in accordance with its terms, an independent third party (the “ Independent Third Party ”) shall have the right to exercise all of the Delegated Rights. If for any reason the Independent Third Party (or, following the delivery by United of a United Approval Notice, United) is not permitted directly to vote Kingsland’s Shares with respect to such Delegated Right, then Kingsland and its Affiliates shall, at the written request of the Independent Third Party (or, following the delivery by United of a United Approval Notice, United), as applicable, exercise or waive any Delegated Rights on behalf of, and only on the instructions of, the Independent Third Party or United, as the case may be; provided that Kingsland shall not be obligated to vote such Shares unless it receives at least three Business Days’ notice of such request.

(b)    As soon as reasonably practicable after the date hereof, United and NewCo will identify and select, after consultation with Kingsland, a Person to serve as the Independent Third Party to exercise all of the Delegated Rights; provided, however, that until the election by United and NewCo of such Independent Third Party, the Independent Third Party shall be Kingsland, it being understood that, for so long as Kingsland is serving as the Independent Third Party, Kingsland will not be required to deliver written requests, notices, approvals, waivers or similar written instruments to itself if the Independent Third Party is otherwise required to deliver such written requests, notices, approvals, waivers or similar written instruments to Kingsland pursuant to the terms of this Agreement. Kingsland will serve as the Independent Third Party until

 

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United and NewCo identify and select, after consultation with Kingsland, another Independent Third Party (or, if earlier, until United has delivered a United Approval Notice with respect to all of the Delegated Rights). During any period of time that Kingsland is serving as the Independent Third Party, neither Kingsland nor its Affiliates shall exercise (or not exercise or waive) Delegated Rights (including JAA Approval Rights and JAA Veto Rights) to terminate a Joint Business Agreement, other than in the case of a Permitted JBA Termination.

(c)    The Parties agree to execute and deliver such further documents and take such further actions, as may be reasonably required by United, a United Designee or the Independent Third Party, as applicable, in connection with its exercise of the Delegated Rights including amending this Agreement or the Organization Documents or the JAA (other than any such amendment that increases the liabilities or obligations or reduces the rights of such Party under this Agreement, the Organization Documents or the JAA, in each case in a manner that is disproportionate to such Party’s equity ownership of the Company, or that creates a direct financial obligation of such Party to which such Party has not agreed in writing), and entering into an agreement with the Independent Third Party and such other Parties as may be reasonably required by United, a United Designee or the Independent Third Party (the “ Independent Third Party Agreement ”), provided in each case any such agreement shall reflect the applicable provisions of this Section  3.9 and shall provide that the Independent Third Party shall perform its duties in a manner intended to preserve and enhance the value of the Company. The Independent Third Party Agreement shall be confidential among the Independent Third Party and the other parties thereto, and no Person that is not a party thereto shall have any right to review such agreement (other than the Company, subject to Section  3.7 ).

(d)    The Independent Third Party (other than Kingsland) will serve in this capacity until the earlier of (A) 60 days (or such shorter period as may be provided in the Independent Third Party Agreement) after the Independent Third Party notifies the Parties that it is no longer willing to serve as the Independent Third Party; (B) the Independent Third Party’s death, Disability or Incapacity, or (C) the date that United delivers a United Approval Notice with respect to all of the Delegated Rights and such Independent Third Party is no longer required; provided , that in the case of each of clauses (A)  and (B) above, United and NewCo will promptly identify and select, after consultation with Kingsland, a replacement Independent Third Party; and provided, further , that:

(i)    until such replacement Independent Third Party is selected pursuant to the first proviso in Section 3.9(b) above, Kingsland shall automatically succeed and replace such Independent Third Party and serve as the temporary Independent Third Party (subject to Section  3.9(d)(ii) below) until a replacement Independent Third Party is selected pursuant the first proviso in Section  3.9(d) above, and Kingsland shall confirm in writing to both NewCo and United its acknowledgement of such service as temporary Independent Third Party promptly after receipt by it of written notice from NewCo, the Independent Third Party, United or a United Designee of its automatic succession;

(ii)     if at any time during the period described in Section  3.9(d)(i) above Kingsland notifies United or NewCo in writing that it is unwilling or unable to serve as the temporary Independent Third Party pursuant to Section  3.9(d)(i) above, or if Kingsland fails to deliver a written acknowledgement described above to both NewCo and the Independent Third Party within five Business Days following the delivery of written notice to it as described above, then United shall promptly deliver to NewCo in writing a list of three Persons proposed by United to serve as a replacement temporary Independent Third Party, and NewCo shall promptly select in writing one of such three

 

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Persons to serve as the temporary Independent Third Party. If NewCo does not select in writing a temporary Independent Third Party from the three-Person proposal submitted by United within ten Business Days (or during the continuance of an Event of Default, one Business Day) after United delivers such list to NewCo, then NewCo shall be deemed to have selected the first Person on the list proposed by United, and such temporary Independent Third Party shall serve until a replacement Independent Third Party is selected pursuant to Section  3.9(d)(i) above.

(e)    At such time, if ever, as United delivers a United Approval Notice with respect to any or all of the Delegated Rights, United (or, if designated by United, the United Designee) shall automatically succeed to each of such rights and authority identified in such United Approval Notice, supplanting the rights and authority of the Independent Third Party (or Kingsland or any other temporary Independent Third Party) with respect to such identified rights and authority, without any further amendment of this Agreement or the JAA.

(f)    The Independent Third Party may only be removed with the written consent of both NewCo and United, except if (i) United delivers a United Approval Notice with respect to all of the Delegated Rights or (ii) an Event of Default has occurred and is continuing, in which case NewCo’s consent will not be required for the removal of the Independent Third Party.

(g)    The compensation, costs and expenses related to the Independent Third Party shall be addressed in the Independent Third Party Agreement; provided, however , that neither Kingsland nor NewCo shall be required to pay any portion of such compensation, cost and expenses unless it has agreed to do so in such Independent Third Party Agreement.

(h)    Notwithstanding anything contained in this Section  3.9 , if United assigns any of its rights under this Agreement (other than its rights under Section  3.3(a)(i) ) or the JAA to the Independent Third Party or a United Designee pursuant to Section  6.6 , then the restrictions of this Section  3.9 shall not apply with respect to such rights.

(i)    Notwithstanding anything to the contrary herein, upon the earlier to occur of (A) the consummation of the full Transfer of all record and beneficial interests in the Put Shares, whether pursuant to the Put Option Agreement, or otherwise in accordance with the terms and conditions of this Agreement and the JAA (but, for the avoidance of doubt, not merely pursuant to the Usufruct Documents or similar arrangements) and (B) the tenth (10 ^th ) anniversary of the Effective Date, Kingsland shall have no further obligation to serve as the Independent Third Party, or take any other action under this Section  3.9 .

Section 3.10     Anti-Money Laundering Laws; Anti-Corruption Laws .

(a)    In relation to the Company and the business of the Company, each Party shall comply with applicable Anti-Money Laundering Laws and Anti-Corruption Laws.

(b)    The Party that is the Controlling Shareholder of the Company, shall use its reasonable commercial efforts to ensure that the Company and its Subsidiaries and Affiliates make and keep books, records, and accounts, which, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the respective assets of the Company, and that the Company has and will continue to maintain in place adequate internal controls and systems to ensure: (i)

 

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transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary to: (A) permit preparation of financial statements in conformity with generally accepted accounting principles or any other criteria applicable to such statements and (B) maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s general or specific authorization and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences, in each case, in accordance with IFRS.

ARTICLE 4

REPRESENTATIONS AND WARRANTIES

Each Party hereby represents and warrants to the other Parties, as of the date of hereof, that:

Section 4.1     Organization and Good Standing . Such Party is an Entity duly organized, validly existing and in good standing under the Laws of its jurisdiction of incorporation or organization.

Section 4.2     Authority .

(a)    Such Party has the full power and authority to enter into this Agreement and to perform all of its obligations hereunder.

(b)    The execution, delivery and performance of this Agreement have been duly and validly authorized by all requisite corporate or similar action on the part of such Party.

Section 4.3     Enforceability . This Agreement has been duly and validly executed and delivered by such Party and constitutes a legal, valid and binding obligation of such Party, enforceable against such Party in accordance with its terms, except as enforcement may be limited by equitable principles or bankruptcy, insolvency, reorganization, moratorium or similar Laws relating to creditors’ rights generally.

Section 4.4     No Violations . The execution, delivery and performance by such Party of this Agreement do not and will not:

(a)    violate any provision of the Organization Documents of such Party; or

(b)    violate any provision of or require any filing or approval under any Law applicable to such Party.

Section 4.5     Compliance with Laws . Such Party has complied with all Laws, including applicable Anti-Money Laundering Laws and Anti-Corruption Laws, except where the failure to comply with such Laws would not, individually or in the aggregate, reasonably be expected to result in material liability to such Party’s business, or otherwise materially impair the operation of such Party’s business. Such Party is not, to its knowledge, the subject or target of any investigation, inquiry, or proceeding by a Governmental Authority relating to, and has not been given written notice by a Governmental Authority of, any potential violation of any Laws, including applicable Anti-Corruption Laws and/or Anti-Money Laundering Laws, except where

 

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the failure or potential failure to comply with such Law would not, individually or in the aggregate, reasonably be expected to result in material liability to such Party’s business, or otherwise materially impair the operation of such Party’s business. There is no Judgment to which such Party, or the business or any assets thereof, are subject, except where such Judgment would not, individually or in the aggregate, reasonably be expected to result in material liability to such Party’s business, or otherwise materially impair the operation of such Party’s business.

Section 4.6     Brokerage or Finders Fees . Such Party has not engaged or entered into any Contract with any broker, finder or agent with respect to the transactions contemplated by this Agreement which would result in any liability or obligation on the part of the other Parties, including any fees, commissions or reimbursement claims.

ARTICLE 5

TERM

Section 5.1     Term . This Agreement shall be effective as of the Effective Date and shall remain in full force and effect until the latest of (a) 10 years following the Effective Date and (b) payment in full by NewCo of all of the Obligations; provided , however , that Article  6 will survive any termination of this Agreement; provided further , however , that if the JAA is still in force and effect at the time this Agreement terminates in accordance with this Section  5.1 , then Section  3.3(a) and Section  3.9 will survive any such termination of this Agreement until the JAA is terminated in accordance with its terms; provided further , however , notwithstanding anything to the contrary contained in the Transaction Documents, if NewCo has paid the Cooperation Payment pursuant to Sections 3.2 or 3.5 of the Cooperation Agreement, then Section  2.4 (only with respect to Kingsland’s Common Shares) and Section  2.6 will survive any termination of this Agreement until Kingsland no longer owns any Common Shares; provided further , that if this Agreement is terminated in accordance with this Section  5.1 and United no longer holds any Common Shares, then Section  2.4 and Section  2.6 shall apply only to NewCo in respect of any Transfer of Kingsland’s Common Shares.

ARTICLE 6

MISCELLANEOUS

Section 6.1     Indemnification .

(a)     Indemnification by NewCo . NewCo agrees to protect, indemnify and hold harmless United, the United Designee and their respective officers, Affiliates, directors, employees, attorneys, accountants, consultants, representatives and agents (collectively called the “ United Indemnitees ”) and Kingsland and its officers, Affiliates, directors, employees, attorneys, accountants, consultants, representatives and agents (collectively called the “ Kingsland Indemnitees ”) from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, claims, costs, out-of-pocket expenses and disbursements of any kind or nature whatsoever (including the reasonable fees and disbursements of counsel for and consultants of such United Indemnitees or Kingsland Indemnitees, as applicable, in connection with any investigative, administrative or judicial proceeding, whether or not such United Indemnitees or Kingsland Indemnitees, as applicable, shall be designated a party thereto), which may be imposed on, incurred by, or asserted against such United Indemnitees or Kingsland Indemnitees, as

 

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applicable, by any third party (whether direct, indirect, or consequential and whether based on any securities and commercial laws and regulations, under common law or at equitable cause or on contract or otherwise), to the extent relating to or arising out of NewCo’s breach of any of its representations, warranties, covenants, agreements and obligations under this Agreement (collectively, the “ NewCo Indemnified Matters ”); provided , however , that NewCo shall not have any obligation to any United Indemnitee or Kingsland Indemnitee hereunder with respect to NewCo Indemnified Matters caused by or resulting from the willful misconduct or gross negligence of such United Indemnitee or Kingsland Indemnitee, as applicable, as determined by a court of competent jurisdiction in a final, non-appealable decision. The obligations of NewCo under this Section  6.1(a) shall survive the termination or expiry of this Agreement.

(b)     Indemnification by Kingsland . Kingsland agrees to protect, indemnify and hold harmless the United Indemnitees and NewCo and its officers, Affiliates, directors, employees, attorneys, accountants, consultants, representatives and agents (collectively called the “ NewCo Indemnitees ”) from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, claims, costs, out-of-pocket expenses and disbursements of any kind or nature whatsoever (including the reasonable fees and disbursements of counsel for and consultants of such United Indemnitees or NewCo Indemnitees, as applicable, in connection with any investigative, administrative or judicial proceeding, whether or not such United Indemnitees or NewCo Indemnitees, as applicable, shall be designated a party thereto), which may be imposed on, incurred by, or asserted against such United Indemnitees or NewCo Indemnitees, as applicable, by any third party (whether direct, indirect, or consequential and whether based on any securities and commercial laws and regulations, under common law or at equitable cause or on contract or otherwise), to the extent relating to or arising out of Kingsland’s breach of any of its representations, warranties, covenants, agreements and obligations under this Agreement (collectively, the “ Kingsland Indemnified Matters ”); provided , however , that Kingsland shall not have any obligation to any United Indemnitee or NewCo Indemnitee hereunder with respect to Kingsland Indemnified Matters caused by or resulting from the willful misconduct or gross negligence of such United Indemnitee or NewCo Indemnitee, as applicable, as determined by a court of competent jurisdiction in a final, non-appealable decision. The obligations of Kingsland under this Section  6.1(b) shall survive the termination or expiry of this Agreement.

(c)     Indemnification by United . United agrees to protect, indemnify and hold harmless the NewCo Indemnitees and Kingsland Indemnitees from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, claims, costs, out-of-pocket expenses and disbursements of any kind or nature whatsoever (including the reasonable fees and disbursements of counsel for and consultants of such NewCo Indemnitees or Kingsland Indemnitees, as applicable, in connection with any investigative, administrative or judicial proceeding, whether or not such NewCo Indemnitees or Kingsland Indemnitees, as applicable, shall be designated a party thereto), which may be imposed on, incurred by, or asserted against such NewCo Indemnitees or Kingsland Indemnitees, as applicable, by any third party (whether direct, indirect, or consequential and whether based on any securities and commercial laws and regulations, under common law or at equitable cause or on contract or otherwise), to the extent relating to or arising out of United’s breach of any of its representations, warranties, covenants, agreements and obligations under this Agreement, and with respect to Kingsland Indemnitees only, to the extent relating to or arising out of Kingsland’s granting of the Delegated Rights or its service as the United Designee or the Independent Third Party (including any actions or omissions in such

 

52

capacity, including any exercise of, or determination not to exercise, any JAA Veto Rights or any other Delegated Rights) (collectively, the “ United Indemnified Matters ”); provided , however , that United shall not have any obligation to any NewCo Indemnitee or Kingsland Indemnitee hereunder with respect to United Indemnified Matters caused by or resulting from the willful misconduct or gross negligence of such NewCo Indemnitee or Kingsland Indemnitee, as applicable, as determined by a court of competent jurisdiction in a final, non-appealable decision. The obligations of United under this Section  6.1(c) shall survive the termination or expiry of this Agreement.

(d)     Exculpation . United agrees that neither Kingsland nor any other Kingsland Indemnitee shall have any liability to United or any of its Affiliates in connection with or as a result of the granting of the Delegated Rights or its service as the United Designee or the Independent Third Party (including any actions or omissions in such capacity, including any exercise of, or determination not to exercise, any JAA Veto Rights or any other Delegated Rights) as well as any action taken, or not taken, by Kingsland (i) in compliance with Section  3.1 , Section  3.3(a)(i) or Section  3.9 of this Agreement and (ii) any other action taken or not taken by Kingsland, or any director designated to the Board of Directors of the Company by Kingsland, at the written direction of, or with the written consent of, United, a United Designee or the Independent Third Party; provided , however , that the provisions of this Section  6.1(d) shall not apply to any claim by United or any of its Affiliates caused by or resulting from the willful misconduct or gross negligence of Kingsland or any other Kingsland Indemnitee, as determined by a court of competent jurisdiction in a final, non-appealable decision. The obligations of United under this Section  6.1(d) shall survive the termination or expiry of this Agreement.

Section 6.2     Further Assurances . The Parties agree that from time to time after the date hereof, they will execute and deliver such further documents and take such further actions, as may be reasonably necessary to carry out the purpose and intent of this Agreement.

Section 6.3     Entire Agreement .    The Transaction Documents set forth the entire agreement and understanding of the Parties in respect of the matters addressed herein and supersede all prior agreements, arrangements and undertakings (oral or written) relating to the subject matter hereof. No representation, promise, inducement or statement of intention has been made by any Party which is not embodied in or superseded by the Transaction Documents, and no Party shall be bound by or liable for any alleged representation, promise, inducement or statement of intention not so set forth; provided , however , that it is understood that certain Parties and their Affiliates are also entering into other agreements with respect to the ownership of the Company’s shares or the operation of the Company as of the Effective Date, and it being further understood that the Organization Documents of the Company contain various terms that are also applicable to the Parties, as set forth therein.

Section 6.4     Conflicting Provisions . If any provision in this Agreement conflicts with the Organization Documents of the Company or the JAA (or the 100% JAA, as applicable), then each of the Parties agrees to vote its Common Shares to amend the Organization Documents and the JAA (or the 100% JAA, as applicable) to remedy the conflict in order that the provisions of this Agreement prevail. In the event of any conflict between this Agreement and the JAA (or the 100% JAA, as the case may be), this Agreement shall control. At the request of United, the Parties agree to amend the JAA (or the 100% JAA, as applicable) and the Organization Documents to reflect United’s rights in this Agreement.

 

53

Section 6.5     Successors and Assigns . Subject to the restrictions on Transfer set forth in this Agreement, this Agreement and all of the terms, covenants and agreements set forth herein shall be binding upon, inure to the benefit of, and be enforceable by the Parties and their respective permitted successors and assigns, heirs, legal representatives, trustees or receivers. No Party may assign or otherwise Transfer any of its rights or obligations hereunder without the prior written consent of the other Parties, except: (i) as provided in Section  6.6 and (ii) that United may assign this Agreement or any of its rights and obligations hereunder to an Affiliate of United, it being understood and agreed that no such assignment shall relieve United of its obligations hereunder.

Section 6.6     Assignment of Rights . Notwithstanding anything in this Agreement to the contrary, United may, at any time and from time to time, and in its sole discretion, assign, Transfer or convey all or any part of its rights under this Agreement (but not, except as otherwise permitted in this Agreement, its obligations) to any Person; provided , however , that United may not assign, Transfer or convey any of its rights under this Agreement to a Non-Permitted Holder, provided that no Event of Default has occurred and is continuing. United will provide prior written notice to the Parties no later than 15 Business Days upon any such assignment, Transfer or conveyance.

Section 6.7     Waivers; Cumulative Remedies . Any term or provision of this Agreement may be waived, or the time for its performance may be extended, by the Parties entitled to the benefit thereof. Any such waiver shall be validly and sufficiently given for the purposes of this Agreement if, as to any Party, it is in writing signed by a Responsible Officer of such Party. The failure of any Party hereto to enforce at any time any provision of this Agreement shall not be construed to be a waiver of such provision, nor in any way to affect the validity of this Agreement or any part hereof or the right of any Party thereafter to enforce each and every such provision. No waiver of any breach of this Agreement shall be held to constitute a waiver of any other or subsequent breach. The rights, remedies, powers and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

Section 6.8     Amendments . Except as otherwise provided herein, this Agreement may be amended or modified from time to time only by a written agreement by all the Parties.

Section 6.9     Notices . All notices, requests, demands and other communications (collectively, “ Notices ”) required or permitted to be given hereunder shall be in writing and delivered (a) personally, (b) by electronic transmission, which is confirmed by the recipient (in the case of email, an automated reply shall not constitute confirmation by the recipient), or (c) mailed by a recognized courier service to the following addresses:

If to the Company:

Avianca Holdings, S.A.

Avenida Calle 26 No. 59-15 Edificio Administrativo Avianca,

Bogotá – Colombia

Attn: Renato Covelo, General Counsel

Email: renato.covelo@avianca.com

 

54

with a copy (which shall not constitute notice) to:

Simpson Thacher & Bartlett LLP

425 Lexington Avenue

New York, NY 10017

Attn: David Williams

Email: dwilliams@stblaw.com

If to Kingsland:

Kingsland Holdings Limited

c/o The Winterbotham Trust Company Limited

Winterbotham Place

Malborough and Queen Streets

Nassau, Commonwealth of the Bahamas

Attn: Rodrigo Salcedo, José Gurdian, Joaquin Palomo, Roberto Kriete

Email: rsalcedo@caobacapital.com, jgurdian@caobacapital.com, joaquin.palomo@aeroman.com.sv, rkriete@mroholdings.com

with a copy (which shall not constitute notice) to:

Cadwalader, Wickersham & Taft LLP

200 Liberty Street

New York, NY 10281

Attn: Richard Brand and Andrew Alin

Email: Richard.Brand@cwt.com and Andrew.Alin@cwt.com

If to NewCo:

1209 Orange Street

Wilmington, DE 19801

Attn.: Mrs. Marcela Quental and Mr. Guilherme Pinheiro

Email: marcela.quental@synergygroupcorp.com and

guilherme.pinheiro@avianca.com.br

with a copy (which shall not constitute notice) to:

Rua Profa. Heloísa Carneiro, 21

Jardim Aeroporto, Postal Code 04630-050

São Paulo – SP, Brazil

Attn.: Mrs. Marcela Quental and Mr. Guilherme Pinheiro

Email: marcela.quental@synergygroupcorp.com and

guilherme.pinheiro@avianca.com.br

 

55

with a copy (which shall not constitute notice) to:

Tauil & Chequer Advogados Associados a Mayer Brown LLP

Av. Presidente Juscelino Kubitschek, 1,455, 5 ^th , 6 ^th and 7 ^th floors

São Paulo, SP, Brazil

Attn.: Mr. Carlos Motta

Email: cmotta@mayerbrown.com

Mayer Brown LLP

71 South Wacker Drive

Chicago, Illinois

Attn.: Mr. Daniel Whitmore

Email: dwhitmore@mayerbrown.com

If to United:

United Airlines, Inc.

233 South Wacker Drive

Chicago, IL 60606

Attn: Senior Vice President – Alliances

Email: john.gebo@united.com

with a copy (which shall not constitute notice) to:

Sidley Austin LLP

1000 Louisiana Street, Suite 6000

Houston, TX 77002

Attn: Kevin Lewis

Email: klewis@sidley.com

All Notices shall be effective upon receipt, except that a Notice given by electronic transmission will be effective on the date sent (with confirmation of transmission) if sent during normal business hours of the recipient or on the next Business Day if sent (with confirmation of transmission) after the normal business hours of the recipient. Any Party may change its Notice information by giving written Notice to all other Parties in the manner specified above. Upon selection of the Independent Third Party pursuant to Section  3.9 , the Independent Third Party will provide its Notice information by giving written Notice to all other Parties in the manner specified above. All notices delivered by the Company to Kingsland in respect of its Shares shall also be delivered to the Independent Third Party or, following the delivery by United of a United Approval Notice, to United.

Section 6.10     GOVERNING LAW; JURISDICTION, ETC.

(a)     GOVERNING LAW . THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAWS, BUT OTHERWISE WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES).

 

56

(b)     SUBMISSION TO JURISDICTION . EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION OR PROCEEDING OF ANY KIND OR DESCRIPTION, WHETHER IN LAW OR EQUITY, WHETHER IN CONTRACT OR IN TORT OR OTHERWISE, AGAINST ANY OTHER PARTY IN ANY WAY RELATING TO THIS AGREEMENT OR THE TRANSACTIONS RELATING HERETO, IN ANY FORUM OTHER THAN THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION, LITIGATION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION, LITIGATION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT ANY PARTY MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AGAINST ANY OTHER PARTY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(c)     WAIVER OF VENUE . EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT IN ANY COURT REFERRED TO IN SECTION  6.10 (b) . EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

(d)     SERVICE OF PROCESS . EACH PARTY HERETO HEREBY IRREVOCABLY CONSENTS AND AGREES THAT THE SERVICE OF ANY AND ALL LEGAL PROCESS, SUMMONS, NOTICES AND DOCUMENTS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING MAY BE MADE BY MAILING COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO THE ADDRESS SPECIFIED IN SECTION  6.9 . EACH PARTY HERETO HEREBY AGREES THAT SERVICE UPON IT, OR ANY OF ITS AGENTS, IN EACH CASE, IN ACCORDANCE HEREWITH, SHALL CONSTITUTE VALID AND EFFECTIVE PERSONAL SERVICE UPON SUCH PARTY, AND EACH PARTY HERETO HEREBY AGREES THAT THE FAILURE OF ANY OF ITS AGENTS TO GIVE ANY NOTICE OF SUCH SERVICE TO ANY SUCH PARTY SHALL NOT IMPAIR OR AFFECT IN ANY WAY THE VALIDITY OF SUCH SERVICE ON SUCH PARTY OR ANY JUDGMENT RENDERED IN ANY ACTION OR PROCEEDING BASED THEREON. KINGSLAND FURTHER HEREBY IRREVOCABLY DESIGNATES, APPOINTS AND EMPOWERS CORPORATION SERVICE COMPANY, WITH OFFICES AT 1180 AVENUE OF THE AMERICAS, NY, NY 10036 AS ITS AUTHORIZED AGENT FOR SERVICE OF PROCESS IN THE STATE OF NEW YORK IN ANY SUIT, ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT.

 

57

(e)     WAIVER OF SOVEREIGN IMMUNITY . TO THE EXTENT THAT ANY PARTY HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION, EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, SUCH PARTY HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT AND, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, AGREES THAT THE WAIVERS SET FORTH HEREIN SHALL HAVE THE FULLEST SCOPE PERMITTED UNDER THE UNITED STATES FOREIGN SOVEREIGN IMMUNITIES ACT OF 1976 AND ARE INTENDED TO BE IRREVOCABLE FOR PURPOSES OF SUCH ACT.

(f)     WAIVER OF JURY TRIAL . EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (i) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (ii) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

(g)     Acknowledgement . Each Party hereby acknowledges that the waivers in this Section  6.10 are a material inducement to the other Parties entering into this Agreement and that each Party is relying upon the foregoing in their dealings with the other Parties. Each Party has reviewed the waivers in this Section  6.10 with their legal counsel and have knowingly and voluntarily waived jury trial and other rights following consultation with legal counsel. In the event of litigation, this Agreement may be filed as a written consent to a trial by the court.

Section 6.11     Severability . In the event any of the provisions hereof are held to be invalid or unenforceable under any Law, the remaining provisions hereof shall not be affected thereby. In such event, the Parties agree and consent that such provisions and this Agreement shall be modified and reformed so as to effect the original intent of the Parties as closely as possible with respect to those provisions which were held to be invalid or unenforceable. Notwithstanding the foregoing and the fact that the Company is incorporated under the Laws of Panama, the Parties agree that the rights and obligations contained in this Agreement shall be governed, construed and enforced in accordance with Section  6.10 .

 

58

Section 6.12     Execution in Counterparts . This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.

Section 6.13     Electronic Transmissions . Each of the Parties agrees that (a) any consent or signed document transmitted by electronic transmission shall be treated in all manner and respects as an original written document, (b) any such consent or document shall be considered to have the same binding and legal effect as an original document and (c) at the request of any Party, any such consent or document shall be re-delivered or re-executed, as appropriate, by the relevant party or parties in its original form. Each of the Parties further agrees that they will not raise the transmission of a consent or document by electronic transmission as a defense in any proceeding or action in which the validity of such consent or document is at issue and hereby forever waives such defense. For purposes of this Agreement, the term “electronic transmission” means any form of communication not directly involving the physical transmission of paper, that creates a record that may be retained, retrieved and reviewed by a recipient thereof, and that may be directly reproduced in paper form by such a recipient through an automated process.

Section 6.14     Third Party Beneficiar ies . Each Party agrees that each of the Independent Third Party and the United Designee is a third party beneficiary of this Agreement and has the right to enforce this Agreement directly to the extent it may deem necessary or advisable to protect its rights arising hereunder. Except to the extent expressly set forth herein, this Agreement is not intended to, and shall not, confer upon any other Person, other than the Parties hereto, any rights or remedies with respect to the subject matter or any provision hereof.

Section 6.15     Specific Performance . The Parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached or threatened to be breached. It is accordingly agreed that the Parties shall be entitled (without proof of actual damages or otherwise or posting or securing any bond) to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement, these being in addition to any other remedy to which they are entitled at law or in equity. The Parties further agree not to assert that a remedy of specific performance is unenforceable, invalid, contrary to Law or inequitable for any reason, nor to assert that a remedy of monetary damages would provide adequate remedy. Each of the Parties acknowledges and agrees that the right to specific performance and the other relief contemplated herein is an integral part of the transactions contemplated hereby and without such right, none of the Parties would have entered into this Agreement.

Section 6.16     Shareholders Agreement . This Agreement shall be considered to be a “shareholders agreement” for purposes of the Corporation Law of Panama, Law 32 of February 26, 1927 and other applicable Law of the Republic of Panama.

[The remainder of this page is intentionally left blank.]

 

59

IN WITNESS WHEREOF, each Party has duly executed this Agreement as of the date first written above.

 

 

[S IGNATURE P AGE TO S HARE R IGHTS A GREEMENT ]

 

[S IGNATURE P AGE TO S HARE R IGHTS A GREEMENT ]

 

[S IGNATURE P AGE TO S HARE R IGHTS A GREEMENT ]

 

[S IGNATURE P AGE TO S HARE R IGHTS A GREEMENT ]

EXHIBIT A

INSTRUMENT OF TRANSFER

STOCK POWER ¹

FOR VALUE RECEIVED, [●], [●] organized under the laws of [●] (“ Assignor ”), hereby irrevocably sells, assigns and transfers (the “ Transfer ”) to [●] (the “ Assignee ”), a [●] organized under the laws of [●], [●] common shares ( acciones comunes ) of Avianca Holdings, S.A., a corporation ( sociedad anónima ) organized under the laws of the Republic of Panama (the “ Company ”), represented by Share Certificate No. [●], free and clear of Liens (as defined in the Share Rights Agreement), other than Liens created by or pursuant to the Transaction Documents (as defined in the Share Rights Agreement). “ Share Rights Agreement ” means that certain Share Rights Agreement, dated as of [●], by and among the Company, Assignor, United Airlines, Inc., and Kingsland Holdings Limited.

The Assignor hereby (i) authorizes the Assignee to inform the Secretary Board of Directors of the Company about the Transfer in order for the Company to issue a new Share Certificate in favour of the Assignee and to register the Transfer in the books and records of the Company and (ii) irrevocably constitutes and appoints the                                          as agent with full power of substitution in the premises and for the purpose to make and execute all necessary acts of assignment and transfer hereof.

IN WITNESS HEREOF, the undersigned has executed this Stock Power as of the date indicated below.

Dated this [●] day of [●], 20[●].

[●]

 

By
Name:
Title:

 

 

1	Note to Draft : The executed version of this stock power form must be notarized by a Panamanian notary or apostilled .

 

E XHIBIT A

EXHIBIT B

FORM OF SALE NOTICE

 

To: 2

Kingsland Holdings Limited

c/o The Winterbotham Trust Company Limited

Winterbotham Place

Malborough and Queen Streets

Nassau, Commonwealth of the Bahamas

Attn: [●]

Email: [●]

                 20[●]

Dear Sirs:

Reference is made to that certain Share Rights Agreement, dated [●], 2018 (the “ Agreement ”), by and among Avianca Holdings S.A., a corporation organized under the Laws of the Republic of Panama, United Airlines, Inc., a Delaware corporation, Kingsland Holdings Limited, a company organized under the Laws of the Commonwealth of the Bahamas, and BRW Aviation LLC, a Delaware limited liability company. All capitalized terms used in this Sale Notice and not otherwise defined herein will have the respective meanings set forth in the Agreement.

Pursuant to Section 2.2(b) of the Agreement, [●] (the “ United Seller ”) hereby furnishes you notice that it proposes to Transfer to [●], through a [INSERT DESCRIPTION OF TRANSACTION INCLUDING A DESCRIPTION OF ANY NON-CASH CONSIDERATION IN SUFFICIENT DETAIL TO PERMIT THE VALUATION THEREOF] (the “ Proposed Transaction ”). The terms of the Proposed Transaction are as follows:

(a)    the number of Shares to be sold by the United Seller is equal to [●];

(b)    the name of the Proposed Transferee is [●];

(c)    the per Share purchase price is [●];

(d)    the proposed date, time and location of the closing of such Proposed Transaction are as follows: [●]; and

(e)    a copy of any definitive Share purchase and sale agreement entered into with respect to such Proposed Transaction or form of Share purchase and sale agreement proposed to be executed in connection herewith is attached as Annex  A .

 

2	Note to Draft : To be addressed to a Permitted Transferee, as the case may be.

 

E XHIBIT B

Pursuant to Section 2.2(c) of the Agreement, you may elect to participate in such Proposed Transaction by delivering a Tag-along Notice and in the terms set forth in the Agreement.

[The remainder of this page is intentionally left blank.]

 

E XHIBIT B

Yours faithfully,
[UNITED SELLER]
By:
Name:		[●]
Title:		[●]

 

E XHIBIT B

ANNEX A

DEFINITIVE SHARE PURCHASE AND SALE AGREEMENT

See attached.

 

E XHIBIT B

EXHIBIT C

FORM OF TAG-ALONG NOTICE

 

To 3 :

[United Airlines, Inc.

233 South Wacker Drive

Chicago, IL 60606

Attn: Senior Vice President – Alliances

Email: john.gebo@united.com]

 

or

 

[[Permitted Transferee of United]

[Address]

[Address]

Attn: [●]

Email: [●]]

                     20[●]

Dear Sirs:

Reference is made to that certain Share Rights Agreement, dated [●], 2018 (the “ Agreement ”), by and among Avianca Holdings S.A., a corporation organized under the Laws of the Republic of Panama, United Airlines, Inc., a Delaware corporation, Kingsland Holdings Limited, a company organized under the Laws of the Commonwealth of the Bahamas, and BRW Aviation LLC, a Delaware limited liability company. All capitalized terms used in this Tag-along Notice and not otherwise defined herein will have the respective meanings set forth in the Agreement.

Pursuant to Section 2.2(c) of the Agreement, we hereby furnish you irrevocable and binding notice to elect to participate in the Tag-along Sale and agree to sell [●] Shares in the terms and conditions set forth in Section 2.2 of the Agreement and the Sale Notice.

[The remainder of this page is intentionally left blank.]

 

3	Note to Draft : Insert notice information of the applicable United Seller.

 

E XHIBIT C

Yours faithfully,
[TAG-ALONG SHAREHOLDER]

By:
Name:		[●]
Title:		[●]

 

E XHIBIT C

EXHIBIT D

FORM OF DRAG-ALONG NOTICE

 

To 4 :

[[●]

[Address]

[Address]

Attn: [●]

Email: [●]]

 

and/or

 

[Kingsland Holdings Limited

c/o The Winterbotham Trust Company Limited

Winterbotham Place

Malborough and Queen Streets

Nassau, Commonwealth of the Bahamas

Attn: [●]

Email: [●]]

                 20[●]

Dear Sirs:

Reference is made to that certain Share Rights Agreement, dated [●], 2018 (the “ Agreement ”), by and among Avianca Holdings S.A., a corporation organized under the Laws of the Republic of Panama, United Airlines, Inc., a Delaware corporation (“ United ”), Kingsland Holdings Limited, a company organized under the Laws of the Commonwealth of the Bahamas, and BRW Aviation LLC, a Delaware limited liability company. All capitalized terms used in this Drag-Along Notice and not otherwise defined herein will have the respective meanings set forth in the Agreement.

Pursuant to Section 2.3(c) of the Agreement, United [and [●]] (the “ Majority Shareholder[s] ”) hereby furnish[es] you notice that the Majority Shareholder[s] propose[s] to Transfer to [●], through a [INSERT DESCRIPTION OF TRANSACTION INCLUDING A DESCRIPTION OF ANY NON-CASH CONSIDERATION IN SUFFICIENT DETAIL TO PERMIT THE VALUATION THEREOF ] (the “ Proposed Transaction ”). The terms of the Proposed Transaction are as follows:

(a)    the name and address of the Drag-Along Transferee is [●];

 

4	Note to Draft : Insert notice information of the applicable Minority Shareholder(s).

 

E XHIBIT D

(b)     [the identity of the economic group and the ultimate owner of the Drag-Along Transferee, if known by United is [ ● ];]

(c)    the proposed amount and form of consideration and terms and conditions of payment (including the details of any price adjustment mechanism, if any) offered by the Drag-Along Transferee are [●]; and

(d)     [INSERT OTHER MATERIAL TERMS OF THE PROPOSED TRANSACTION, INCLUDING THE EXPECTED CLOSING DATE THEREOF] .

Pursuant to 2.3(c)(v) of the Agreement, we hereby request each Minority Shareholder to [ INSERT THE ACTION OR ACTIONS REASONABLY REQUESTED OR REQUIRED OF EACH MINORITY SHAREHOLDER (INCLUDING THOSE THAT MAY BE REASONABLY REQUESTED OR REQUIRED IN THE FUTURE) IN ORDER TO COMPLETE OR FACILITATE SUCH PROPOSED EXIT SALE (INCLUDING (I)  THE TRANSFER OF SHARES OWNED BY EACH MINORITY SHAREHOLDER, (II)  THE VOTING BY SUCH MINORITY SHAREHOLDER IN FAVOR OF THE EXIT SALE AND THE TRANSACTIONS CONTEMPLATED THEREBY AND THE WAIVER OF ANY RELATED APPRAISAL OR DISSENTERS’ RIGHTS AND/OR (III)  THE EXECUTION AND DELIVERY OF ANY MERGER, ASSET PURCHASE, SECURITY PURCHASE, RECAPITALIZATION OR OTHER AGREEMENT, AS APPLICABLE)].

A copy of any executed purchase agreement (or other type of arrangement) with such Drag-Along Transferee or, if no such agreement exists, then a copy of any purchase agreement (or other type of arrangement) submitted or offered by such Drag-Along Transferee in connection with the Exit Sale is attached hereto as Annex A .

Pursuant to Section 2.3(a) of the Agreement, you, as a Minority Shareholder are required to Transfer all, but not less than all, of your Shares and to vote in favor of, consent to, raise no objections to, waive any appraisal rights with respect thereto, waive its JAA Approval Rights and all consent and approval rights under the Company’s Organization Documents and take all commercially reasonable actions requested, necessary or desirable in connection with, the Proposed Transaction.

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E XHIBIT D

Yours faithfully,
UNITED AIRLINES, INC.
By:
Name:		[●]
Title:		[●]

 

[OTHER MAJORITY SHAREHOLDERS]

By:
Name:		[●]
Title:		[●]

 

E XHIBIT D

ANNEX A

DEFINITIVE PURCHASE AGREEMENT

See attached.

 

E XHIBIT D

EXHIBIT E

FORM OF NEWCO PURCHASE OFFER

 

To:	United Airlines, Inc.

233 South Wacker Drive

Chicago, IL 60606

Attn: Senior Vice President – Alliances

Email: john.gebo@united.com

                 20[●]

Dear Sirs:

Reference is made to that certain Share Rights Agreement, dated [●], 2018 (the “ Agreement ”), by and among Avianca Holdings S.A., a corporation organized under the Laws of the Republic of Panama, United Airlines, Inc., a Delaware corporation, Kingsland Holdings Limited, a company organized under the Laws of the Commonwealth of the Bahamas, and BRW Aviation LLC, a Delaware limited liability company. All capitalized terms used in this Purchase Offer and not otherwise defined herein will have the respective meanings set forth in the Agreement.

We hereby inform United that we have received a Bona Fide Offer from a Third-Party Purchaser to Transfer the NewCo ROFR Shares. A copy of such Bona Fide Offer is attached hereto as Annex  A .

Pursuant to Section 2.4(a)(i) of the Agreement, we hereby irrevocably offer to sell to United all of the NewCo ROFR Shares for a purchase price equal to [●] ⁵ and [ INCLUDE (A)  FINANCING TERMS AND (B)  OTHER TERMS AND CONDITIONS AS SET FORTH IN THE BONA FIDE OFFER, IN EACH CASE THAT ARE AT LEAST AS FAVORABLE TO UNITED AS THOSE CONTAINED IN THE BONA FIDE OFFER TO SUCH THIRD-PARTY PURCHASER ]. A copy of any executed purchase agreement (or other type of arrangement) with such Third-Party Purchaser or, if no such agreement (or arrangement) exists, then a copy of any purchase agreement (or other type of arrangement) submitted or offered by such Third-Party Purchaser in connection with the Bona Fide Offer is attached hereto as Annex  B .

Pursuant to Section 2.4(a)(ii) of the Agreement, you have the right and sole option at any time prior to the expiration of the United NewCo Offer Period, to accept, or designate a United Designee to accept, such NewCo Purchase Offer on the price and terms as set forth herein, which right may be exercised by giving a United NewCo Notice of Exercise.

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5	Note to Draft : To be the same price per share as set forth in the Bona Fide Offer and to include the same terms as set forth in the Bona Fide Offer.

 

E XHIBIT E

Yours faithfully,
[          ]
By:
Name:		[●]
Title:		[●]

 

E XHIBIT E

ANNEX A

BONA FIDE OFFER

See attached.

 

E XHIBIT E

ANNEX B

DEFINITIVE PURCHASE AGREEMENT

See attached.

 

E XHIBIT E

EXHIBIT F

FORM OF UNITED NEWCO NOTICE OF EXERCISE

 

To 6 :

[BRW Aviation LLC]

[Address]

[Address]

Attn: [●]

Email: [●]]

                 20[●]

Dear Sirs:

Reference is made to that certain Share Rights Agreement, dated [●], 2018 (the “ Agreement ”), by and among Avianca Holdings S.A., a corporation organized under the Laws of the Republic of Panama, United Airlines, Inc., a Delaware corporation (“ United ”), Kingsland Holdings Limited, a company organized under the Laws of the Commonwealth of the Bahamas (“ Kingsland ”), and BRW Aviation LLC, a Delaware limited liability company. All capitalized terms used in this United Notice of Exercise and not otherwise defined herein will have the respective meanings set forth in the Agreement.

Pursuant to Section  2.4(a)(ii) of the Agreement, United hereby furnishes you notice that [United / [Name of United Designee], as an United Designee], hereby exercises its right of first refusal and accepts the NewCo Purchase Offer on the price and terms as set forth in the NewCo Purchase Offer. The United NewCo ROFR Closing shall occur on [●].

 

6	Note to Draft : Insert notice information of the applicable Seller. To be addressed to a Permitted Transferee, as the case may be.

 

E XHIBIT F

Yours faithfully,
UNITED AIRLINES, INC.
By:
Name:		[●]
Title:		[●]

 

E XHIBIT F

EXHIBIT G

FORM OF NEWCO SELLER’S CERTIFICATE

To 7 :

United Airlines, Inc.

233 South Wacker Drive

Chicago, IL 60606

Attn: Senior Vice President – Alliances

Email: john.gebo@united.com

 

Avianca Holdings S.A.

[Address]

[Address]

Attn: [●]

Email: [●]

                 20[●]

Dear Sirs:

This NewCo Seller’s certificate (the “ Seller’s Certificate ”) is delivered pursuant to Section 2.4(a)(iv) of that certain Share Rights Agreement, dated as of [●], 2018 (the “ Agreement ”), by and among Avianca Holdings S.A., a corporation organized under the Laws of the Republic of Panama, United Airlines, Inc., a Delaware corporation, Kingsland Holdings Limited, a company organized under the Laws of the Commonwealth of the Bahamas, and BRW Aviation LLC, a Delaware limited liability company. All capitalized terms used in this Seller’s Certificate and not otherwise defined herein will have the respective meanings set forth in the Agreement.

The undersigned hereby certifies that he or she is an officer of NewCo Seller, that he or she is authorized in such capacity to execute and deliver this Sellers’ Certificate on behalf of the NewCo Seller and, solely in his or her capacity as an authorized signatory of NewCo Seller and not in any individual capacity, does hereby certify as follows:

1.    NewCo Seller has complied in all respects with the terms and conditions of Section 2.4 including Section 2.4(a)(iv) of the Agreement and, if applicable, offered United the ability to match the terms set forth in NewCo Seller’s agreement with the Third-Party Purchaser, but such offer was not accepted by United (or the United Designee) as set forth, and within the period specified therein.

 

7	Note to Draft : To be addressed to a Permitted Transferee or NewCo, as the case may be.

 

E XHIBIT G

2.    The sale is in compliance with Section 2.1 of the Agreement.

3.    Attached hereto as Annex  A is a copy of the executed purchase agreement with the Third-Party Purchaser, which purchase agreement (or other type of arrangement) includes a condition precedent that NewCo Seller has fully complied with the provisions of Section 2.4 of the Agreement.

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E XHIBIT G

Yours faithfully,
[NEWCO SELLER]
By:
Name:		[●]
Title:		[●]

 

E XHIBIT G

ANNEX A

PURCHASE AGREEMENT

See attached.

 

E XHIBIT G

EXHIBIT H

FORM OF UNITED NEWCO MATCHING NOTICE

 

To:	United Airlines, Inc.

233 South Wacker Drive

Chicago, IL 60606

Attn: Senior Vice President – Alliances

Email: john.gebo@united.com

                 20[●]

Dear Sirs:

Reference is made to that certain Share Rights Agreement, dated [●], 2018 (the “ Agreement ”), by and among Avianca Holdings S.A., a corporation organized under the Laws of the Republic of Panama, United Airlines, Inc., a Delaware corporation (“ United ”), Kingsland Holdings Limited, a company organized under the Laws of the Commonwealth of the Bahamas, and BRW Aviation LLC, a Delaware limited liability company. All capitalized terms used in this United Matching Notice and not otherwise defined herein will have the respective meanings set forth in the Agreement.

Pursuant to Section 2.4(a)(iv) of the Agreement, the [Seller] [●] (“ Seller ”) hereby informs you that the terms of the Seller’s agreement with the Third-Party Purchaser are more favorable to the Third-Party Purchaser than those set forth in the original Bona Fide Offer, as follows: [detail with reasonable specificity any material terms or conditions in the Seller’s agreement (written or oral) with the Third-Party Purchaser that differ from those specified in the Bona Fide Offer.]. The closing of the transaction shall be on the terms set forth in the Third-Party Purchaser’s offer and shall take place on [●] ⁸ .

[The remainder of this page is intentionally left blank.]

 

8	Note to Draft : This United NewCo Matching Notice should be delivered to United at least 30 Business Days prior to the closing of the sale of the NewCo ROFR Shares to a Third-Party Purchaser.

 

E XHIBIT H

Yours faithfully,
[SELLER]
By:
Name:		[●]
Title:		[●]

 

E XHIBIT H