Cayman Islands*
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6770
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98-1560055
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(State or other jurisdiction of
incorporation or organization)
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(Primary Standard Industrial
Classification Code Number)
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(I.R.S. Employer
Identification No.)
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Thomas Holden
Ropes & Gray LLP
Three Embarcadero Center
San Francisco, California 94111
Tel: (415) 315-2355
Fax: (415) 315-4823
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Lawrence Samuelson
Senior Vice President, General Counsel & Corporate Secretary
Cvent, Inc.
1765 Greensboro Station Place, 7
th
Floor
Tysons, VA 22102
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Robert M. Hayward, P.C.
Robert E. Goedert, P.C.
Kevin Frank
Kirkland & Ellis LLP
300 North LaSalle
Chicago, Illinois 60654
Tel: (312) 862-2000
Fax: (312) 862-2200
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Large accelerated filer
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☐
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Accelerated filer
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☐
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Non-accelerated file
r
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☒
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Smaller reporting company
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☒
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Emerging growth company
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☒
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Title of Each Class of
Securities to be Registered
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Amount
to be
Registered(2) |
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Proposed
Maximum Offering Price Per Share |
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Proposed
Maximum Aggregate
Offering Price(1)
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Amount of
Registration Fee
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New Cvent Common Stock(1)
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487,249,396
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$9.96(3)
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$4,853,003,984.16
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$529,462.73(4)
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(1)
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The number of shares of common stock of New Cvent (as defined below) being registered represents (i) 27,600,000 Class A ordinary shares issued in Dragoneer’s (as defined below) initial public offering, (ii) 5,000,000 Class A ordinary shares underlying the forward purchase shares to be issued immediately prior to the First Effective Time (as defined below), but following the Domestication (as defined below); (iii) 6,900,000 Class B ordinary shares held by the initial shareholders; (iv) 752,000 private placement shares held by Sponsor (as defined below); (v) 200,000 shares of common stock of New Cvent that will be issued upon conversion of the principal amount of a working capital loan provided to Dragoneer by Sponsor; and (vi) up to 446,797,396 shares of common stock of New Cvent (the “
New Cvent Common Stock
”) that will be issued to the equityholders of Cvent in connection with the Business Combination (including shares of New Cvent Common Stock underlying New Cvent options to be issued at Closing (as defined below) to current optionholders of Cvent) described in the proxy statement/prospectus/consent solicitation forming part of this registration statement (the “
proxy statement/prospectus/consent solicitation
”).
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(2)
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Pursuant to Rule 416(a) of Securities Act of 1933, as amended (the “
Securities Act
”), there are also being registered an indeterminable number of additional securities as may be issued to prevent dilution resulting from stock splits, stock dividends or similar transactions.
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(3)
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Estimated solely for the purpose of calculating the registration fee, based on the average of the high and low prices of the Class A ordinary shares of Dragoneer on the Nasdaq Global Select Market (“
Nasdaq
”) on September 24, 2021 ($9.96 per Class A ordinary share). This calculation is in accordance with Rule 457(f)(1) of the Securities Act.
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(4)
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Calculated by multiplying the proposed maximum aggregate offering price of securities to be registered by 0.0001091.
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*
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Immediately prior to the consummation of the Business Combination, Dragoneer Growth Opportunities Corp. II, a Cayman Islands exempted company (“
Dragoneer
”), intends to effect a deregistration under the Cayman Islands Companies Act (As Revised) and a domestication under Part XII of the Delaware General Corporation Law, pursuant to which Dragoneer’s jurisdiction of incorporation will be changed from the Cayman Islands to the State of Delaware (the “
Domestication
”). All securities being registered will be issued by the continuing entity following the Domestication, which will be renamed “Cvent Holding Corp.” upon the consummation of the Domestication. As used herein, “New Cvent” refers to Dragoneer after giving effect to the Domestication.
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(a) |
On the Closing Date, prior to the time at which the First Effective Time occurs, Dragoneer will change its jurisdiction of incorporation by deregistering as a Cayman Islands exempted company and continuing and domesticating as a corporation incorporated under the laws of the State of Delaware (the “
Domestication
”), upon which Dragoneer will change its name to “Cvent Holding Corp.” (“
New Cvent
”) (for further details, see “
Proposal No. 2—The Domestication Proposal
|
(b) |
Merger Sub I will merge with and into Cvent (the “
First Merger
”), with Cvent as the surviving company in the First Merger and, after giving effect to such First Merger, Cvent will be a wholly-owned subsidiary of Dragoneer (Cvent, in its capacity as the surviving company of the First Merger, is sometimes referred to as the “
Surviving Company
”).
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(c) |
Immediately following the First Merger and as part of the same overall transaction as the First Merger, the Surviving Company will merge with and into Merger Sub II (the “
Second Merger
”), with Merger Sub II as the surviving company in the Second Merger and, after giving effect to such Second Merger, Merger Sub II will be a wholly-owned subsidiary of Dragoneer. In accordance with the terms and subject to the conditions of the Business Combination Agreement, at the First Effective Time, each share and equity award of Cvent issued and outstanding as of immediately prior to the First Effective Time will be exchanged for shares of New Cvent Common Stock or comparable equity awards that are settled or are exercisable for shares of New Cvent Common Stock, as applicable, based on an implied Cvent equity value of $4,467,973,959.
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• |
Proposal No. 1—The Business Combination Proposal
RESOLVED
Business Combination Agreement
”), by and among Dragoneer, Redwood Opportunity Merger Sub, Inc., a Delaware corporation (“
Merger Sub I
”), Redwood Merger Sub LLC, a Delaware limited liability company (“
Merger Sub II
”), and Papay Topco, Inc., a Delaware corporation (“
Cvent
”), a copy of which is attached to the proxy statement/prospectus/consent solicitation as Annex A, pursuant to which, among other things, following the de-registration of Dragoneer as an exempted company in the Cayman Islands and the continuation and domestication of Dragoneer as a corporation in the State of Delaware with the name “Cvent Holding Corp.”, (a) Merger Sub I will merge with and into Cvent (the “
First Merger
”), with Cvent as the surviving company in the First Merger and, after giving effect to such First Merger, Cvent will be a wholly-owned subsidiary of Dragoneer (Cvent, in its capacity as the surviving company of the First Merger, is sometimes referred to as the “
Surviving Company
”), (b) immediately following the First Merger and as part of the same overall transaction as the First Merger, the Surviving Company will merge with and into Merger Sub II (the “
Second Merger
” and, together with the First Merger, the “
Mergers
”), with Merger Sub II as the surviving entity of the Second Merger and (c) at the First Effective Time, each share and equity award of Cvent outstanding as of immediately prior to the First Effective Time will be exchanged for shares of New Cvent Common Stock or comparable equity awards that are settled or are exercisable for shares of New Cvent Common Stock, as applicable, based on an implied Cvent equity value of $4,467,973,959, on the terms and subject to the conditions set forth in the Business Combination Agreement, certain related agreements (including the Subscription Agreements, the Cvent Shareholder Transaction Support Agreements, the Sponsor Letter Agreement, the Amended and Restated Registration Rights Agreement and the Investor Rights Agreement, each in the form attached to the proxy statement/prospectus/consent solicitation as Annex E, Annex F, Annex G, Annex H and Annex I, respectively), and the transactions contemplated thereby, be approved, ratified and confirmed in all respects.
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• |
Proposal No. 2—The Domestication Proposal
RESOLVED
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• |
Proposal No
3—The Proposed Charter and Bylaws Proposal—RESOLVED
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• |
Advisory Governing Documents Proposals
Existing Governing Documents
”) and the proposed new certificate of incorporation, a copy of which is attached to the proxy statement/prospectus/consent solicitation as Annex C (the “
Proposed Certificate of Incorporation
”) and the proposed new bylaws, a copy of which is attached to the proxy statement/prospectus/consent solicitation as Annex D (the “
Proposed Bylaws
”) of “Cvent Holding Corp.” upon the Domestication (such proposals, collectively, the “
Advisory Governing Documents Proposals
”):
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• |
Proposal No. 4A—Advisory Governing Documents Proposal A—RESOLVED
New Cvent Preferred Stock
”) be approved.
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• |
Proposal No. 4B—Advisory Governing Documents Proposal B—RESOLVED
,
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• |
Proposal No. 4C—Advisory Governing Documents Proposal C—RESOLVED
,
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• |
Proposal No. 4D—Advisory Governing Documents Proposal D—RESOLVED
,
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• |
Proposal No. 4E—Advisory Governing Documents Proposal E—RESOLVED,
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• |
Proposal No. 5—The Nasdaq Proposal
RESOLVED
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• |
Proposal No. 6—The Incentive Equity Plan Proposal
RESOLVED
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• |
Proposal No. 7—The ESPP Proposal
RESOLVED
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• |
Proposal No. 8—The Adjournment Proposal
RESOLVED
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(i) |
hold public shares;
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(ii) |
submit a written request to Continental, Dragoneer’s transfer agent, in which you (i) request that New Cvent redeem all or a portion of your public shares for cash, and (ii) identify yourself as the beneficial holder of the public shares and provide your legal name, phone number and address; and
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(iii) |
deliver share certificates (if any) and other redemption forms (as applicable) to Continental, Dragoneer’s transfer agent, physically or electronically through The Depository Trust Company.
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By Order of the Board of Directors of
Papay Topco, Inc., |
Rajeev K. Aggarwal |
Chief Executive Officer and Director |
[●], 2021 |
1 | ||||
1 | ||||
5 | ||||
9 | ||||
29 | ||||
31 | ||||
62 | ||||
73 | ||||
74 | ||||
138 | ||||
145 | ||||
176 | ||||
179 | ||||
180 | ||||
193 | ||||
194 | ||||
199 | ||||
205 | ||||
206 | ||||
222 | ||||
237 | ||||
243 | ||||
276 | ||||
279 | ||||
321 | ||||
334 | ||||
334 | ||||
336 | ||||
336 | ||||
338 | ||||
338 | ||||
339 | ||||
339 |
• |
“2021 Plan” are to the Cvent Holding Corp. 2021 Omnibus Incentive Plan to be considered for adoption and approval by the shareholders pursuant to the Incentive Equity Plan Proposal;
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• |
“Articles of Association” are to the amended and restated articles of association of Dragoneer;
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• |
“Business Combination” are to the Domestication, the Mergers and other transactions contemplated by the Business Combination Agreement, collectively, including the PIPE Financing;
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• |
“Business Combination Agreement” are to that certain Business Combination Agreement, dated July 23, 2021, by and among Dragoneer, Merger Sub I, Merger Sub II and Cvent;
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• |
“Cayman Islands Companies Act” are to the Companies Act (As Revised) of the Cayman Islands as the same may be amended from time to time;
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• |
“Class A ordinary shares” are to the 27,600,000 Class A ordinary shares, par value $0.0001 per share, of Dragoneer outstanding as of the date of this proxy statement/prospectus/consent solicitation and, in connection with the Domestication, which will automatically convert, on a one-for-one basis, into shares of New Cvent Common Stock;
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• |
“Class B ordinary shares” are to the 6,900,000 Class B ordinary shares, par value $0.0001 per share, of Dragoneer outstanding as of the date of this proxy statement/prospectus/consent solicitation (2,875,000 of which were initially issued to our Sponsor in a private placement prior to our initial public offering and 4,025,000 of which were the result of share dividends effected by Dragoneer) and of which 300,000 were transferred to the Dragoneer independent directors (75,000 each) in October, 2020, and, in connection with the Domestication, which will automatically convert, on a one-for-one basis, into shares of New Cvent Common Stock;
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• |
“Closing” are to the closing of the Business Combination;
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• |
“Closing Date” means that date that is in no event later than the third (3rd) business day following the satisfaction (or, to the extent permitted by applicable law, waiver) of the conditions described under the section entitled
“Business Combination Proposal—The Business Combination Agreement—Conditions to Closing of the Business Combination,”
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• |
“Condition Precedent Proposals” are to the Business Combination Proposal, the Domestication Proposal, the Proposed Charter and Bylaws Proposal, the Nasdaq Proposal and the Incentive Equity Plan Proposal, collectively;
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• |
“Continental” are to Continental Stock Transfer & Trust Company;
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• |
“Cvent” are to Papay Topco, Inc., a Delaware corporation, prior to the consummation of the Business Combination;
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• |
“Cvent Acquisition Proposal” means (a) any transaction or series of related transactions under which any person(s), directly or indirectly, (i) acquires or otherwise purchases Cvent or any of its controlled affiliates or (ii) all or a material portion of assets or businesses of Cvent or any of its controlled affiliates (in the case of each of clause (i) and (ii), whether by merger, consolidation, recapitalization, purchase or issuance of equity securities, tender offer or otherwise), or (b) any equity or similar investment in Cvent or any of its controlled affiliates (subject to exceptions to the PIPE Financing or the issuance of the applicable class of shares of capital stock of Cvent upon the exercise or conversion of any outstanding Cvent equity awards);
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• |
“Cvent Board” are to the board of directors of Cvent;
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• |
“Cvent Stockholders” are to the holders of the issued and outstanding shares of common stock of Cvent;
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• |
“Cvent Supporting Shareholders” are to the Vista Investors and Rajeev K. Aggarwal;
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• |
“Domestication” are to the transfer by way of continuation and deregistration of Dragoneer from the Cayman Islands and the continuation and domestication of Dragoneer as a corporation incorporated in the State of Delaware;
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• |
“Dragoneer,” “we,” “us” or “our” are to Dragoneer Growth Opportunities Corp. II, a Cayman Islands exempted company, prior to the consummation of the Business Combination;
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• |
“Dragoneer Acquisition Proposal” means (a) any transaction or series of related transactions under which Dragoneer or any of its controlled affiliates, directly or indirectly, (i) acquires or otherwise purchases any other person(s), (ii) engages in a business combination with any other person(s) or (iii) acquires or otherwise purchases all or a material portion of the assets or businesses of any other persons(s) (in the case of each of clause (i), (ii) and (iii), whether by merger, consolidation, recapitalization, purchase or issuance of equity securities, tender offer or otherwise) or (b) any equity, debt or similar investment in Dragoneer or any of its controlled affiliates;
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• |
“Dragoneer Board” are to Dragoneer’s board of directors;
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• |
“Dragoneer Parties” are to, collectively, Dragoneer, Merger Sub I and Merger Sub II;
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• |
“Employee Stock Purchase Plan” means the New Cvent Employee Stock Purchase Plan, a copy of which is attached to the proxy statement/prospectus/consent solicitation as Annex K;
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• |
“extraordinary general meeting” are to the extraordinary general meeting of Dragoneer at [●], on [●], 2021, at [●], or at such other time, on such other date and at such other place to which the meeting may be adjourned;
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• |
“Existing Governing Documents” are to the Memorandum of Association and the Articles of Association;
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• |
“First Effective Time” are to the time at which the First Merger becomes effective;
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• |
“First Merger” are to the merger of Merger Sub I with and into Cvent, with Cvent as the surviving company;
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• |
“Forward Purchase Agreement” are to the forward purchase agreement between Dragoneer and Dragoneer Funding II LLC, dated October 29, 2020, whereby Dragoneer Funding II LLC agreed to purchase 5,000,000 Class A ordinary shares for a purchase price of $10.00 per share;
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• |
“Forward Purchase Shares” are to the 5,000,000 Class A ordinary shares to be issued immediately prior to the First Effective Time, but following the Domestication, to Dragoneer Funding II LLC for a purchase price of $10.00 per share pursuant to the Forward Purchase Agreement and the Business Combination Agreement;
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• |
“initial public offering” are to Dragoneer’s initial public offering that was consummated on November 19, 2020;
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• |
“Initial Shareholders” are to Sponsor and each of Sarah J. Friar, David D. Ossip, Gokul Rajaram and Jay Simons;
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• |
“Memorandum of Association” are to the amended and restated memorandum of association of Dragoneer;
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• |
“Mergers” are to, collectively, the First Merger and Second Merger;
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• |
“Merger Sub I” are to Redwood Opportunity Merger Sub, Inc., a Delaware corporation;
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• |
“Merger Sub II” are to Redwood Merger Sub LLC, a Delaware limited liability company and wholly owned subsidiary of Dragoneer prior to the consummation of the Business Combination;
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• |
“Nasdaq” are to the Nasdaq Global Select Market;
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• |
“New Cvent” are to Cvent Holding Corp. (f.k.a. Dragoneer Growth Opportunities Corp. II) upon and after the Domestication;
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• |
“New Cvent Board” are to the board of directors of New Cvent;
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• |
“New Cvent Common Stock” are to the common stock, par value $0.0001 per share, of New Cvent;
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• |
“ordinary shares” are to our Class A ordinary shares and our Class B ordinary shares;
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• |
“PIPE Financing” are to the transactions contemplated by the Subscription Agreements, pursuant to which the PIPE Investors have collectively committed to subscribe for an aggregate of 47,500,000 shares of New Cvent Common Stock for an aggregate purchase price of $475,000,000 to be consummated in connection with Closing;
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• |
“PIPE Investors” are to certain investors with whom Dragoneer entered into Subscription Agreements, collectively;
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• |
“private placement shares” are to the 752,000 private placement shares outstanding as of the date of this proxy statement/prospectus/consent solicitation that were issued to our Sponsor as part of the closing of our initial public offering;
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• |
“pro forma” are to giving pro forma effect to the Business Combination, including the Mergers and the PIPE Financing;
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• |
“Proposed Bylaws” are to the proposed bylaws of New Cvent to be effective upon the Domestication attached to this proxy statement/prospectus/consent solicitation as Annex D;
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• |
“Proposed Certificate of Incorporation” are to the proposed certificate of incorporation of New Cvent to be effective upon the Domestication attached to this proxy statement/prospectus/consent solicitation as Annex C;
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• |
“Proposed Governing Documents” are to the Proposed Certificate of Incorporation and the Proposed Bylaws;
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• |
“public shareholders” are to holders of public shares, whether acquired in Dragoneer’s initial public offering or acquired in the secondary market;
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• |
“public shares” are to the currently outstanding 28,352,000 Class A ordinary shares (including the private placement shares) and 6,900,000 Class B ordinary shares of Dragoneer, whether acquired in Dragoneer’s initial public offering or acquired in the secondary market;
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• |
“redemption” are to each redemption of public shares for cash pursuant to the Existing Governing Documents;
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• |
“SEC” are to the Securities and Exchange Commission;
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• |
“Second Effective Time” means the time at which the Second Merger becomes effective;
|
• |
“Second Merger” are to the merger of Cvent as the surviving company of the First Merger with and into Merger Sub II, with Merger Sub II continuing as the surviving company;
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• |
“Securities Act” are to the Securities Act of 1933, as amended;
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• |
“Sponsor” are to Dragoneer Growth Opportunities Holdings II, a Cayman Islands limited liability company;
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• |
“Subscription Agreements” are to the subscription agreements, entered into by Dragoneer and each of the PIPE Investors in connection with the PIPE Financing;
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• |
“transfer agent” are to Continental, Dragoneer’s transfer agent;
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• |
“trust account” are to the trust account established at the consummation of Dragoneer’s initial public offering that holds the proceeds of the initial public offering and is maintained by Continental, acting as trustee;
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• |
“Vista” are to Vista Equity Partners Management, LLC;
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• |
“Vista Investors” are to investment funds advised by affiliates of Vista Equity Partners Management, LLC; and
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• |
“working capital shares” are to the 200,000 shares of New Cvent Common Stock that will be issued upon conversion of the principal amount of a working capital loan provided to Dragoneer by Sponsor, which conversion will occur upon the consummation of the Business Combination.
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• |
Forrester, Cvent Thought Leadership Study: Data Review, February 22, 2021, which was commissioned by Cvent;
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• |
Frost & Sullivan, Hospitality Cloud GLOBAL TAM 2021/2022, April 2021, which was commissioned by Cvent; and
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• |
Frost & Sullivan, Events Technology GLOBAL TAM 2021/2022, April 2021, which was commissioned by Cvent.
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• |
the impact on Cvent’s operations and financial condition from the effects of the current COVID-19 pandemic;
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• |
Cvent’s ability to attract and retain new customers;
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• |
Cvent’s ability to maintain and expand relationships with hotels and venues;
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• |
the impact of a data breach or other security incident involving Cvent or its customers’ confidential or personal information stored in our or our third-party service providers’ systems;
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• |
risks associated with indemnity provisions in some of Cvent’s agreements;
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• |
the competitiveness of the market in which Cvent operates;
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• |
the impact of a disruption of Cvent’s operations, infrastructure or systems, or disruption of the operations, infrastructure or systems of the third parties on which Cvent relies;
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• |
Cvent’s ability to renew agreements with and sell additional solutions to its customers;
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• |
Cvent’s ability to maintain access to third-party licenses;
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• |
Cvent’s ability to comply with its obligations under license or technology agreements with third parties;
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• |
Cvent’s ability to manage its growth effectively;
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• |
Cvent’s ability to expand its sales force;
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• |
risks and uncertainties associated with potential acquisitions and divestitures;
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• |
Cvent’s ability to operate offices located outside of the United States, including India;
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• |
the impact of declines or disruptions in the demand for events and meetings;
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• |
risks associated with Cvent’s reliance on third-party mobile application platforms such as the Apple App Store and the Google Play Store to distribute its mobile applications;
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• |
Cvent’s history of losses and ability to achieve profitability in the future;
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• |
Cvent’s ability to develop, introduce and market new and enhanced versions of its solutions to meet customer needs and expectations;
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• |
the impact of Cvent’s lengthy and unpredictable sales cycle;
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• |
Cvent’s ability to retain, hire and integrate skilled personnel, including its senior management team;
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• |
Cvent’s ability to fund its research and development efforts;
|
• |
the seasonality of Cvent’s sales and customer growth;
|
• |
Cvent’s ability to offer high-quality customer support;
|
• |
the impact of contractual disputes with Cvent’s customers;
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• |
the impact of any significant reduction in spending by advertisers on Cvent’s platforms;
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• |
Cvent’s ability to maintain, enhance and protect its brand;
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• |
the impact of delays in product and service development, including delays beyond Cvent’s control;
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• |
Cvent’s ability to maintain the compatibility of its solutions with third-party applications;
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• |
risks related to incorrect or improper use of Cvent’s solutions or its failure to properly train customers on how to utilize its solutions;
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• |
the impact of Cvent’s reliance on data provided by third parties;
|
• |
risks associated with privacy concerns and end users’ acceptance of Internet behavior tracking;
|
• |
Cvent’s ability to maintain its corporate culture as it grows;
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• |
Cvent’s ability to comply with legal requirements, contractual obligations and industry standards relating to security, data protection and privacy;
|
• |
Cvent’s ability to comply with the rules and regulations adopted by the payment card networks;
|
• |
Cvent’s ability to obtain, maintain, protect and enforce its intellectual property and proprietary rights;
|
• |
risks associated with lawsuits by third parties for alleged infringement, misappropriation or other violation of their intellectual property and proprietary rights;
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• |
risks associated with Cvent’s use of open source software in certain of its solutions;
|
• |
risks associated with changes in tax laws;
|
• |
the impact of third-party claims, including by governmental bodies, regarding the content and advertising distributed by Cvent’s customers through its service;
|
• |
risks associated with changes in financial accounting standards;
|
• |
risks associated with fluctuations in currency exchange rates;
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• |
Cvent’s ability to raise additional capital or generate cash flows necessary to expand its operations and invest in new technologies in the future;
|
• |
Cvent’s ability to develop and maintain proper and effective internal control over financial reporting;
|
• |
our ability to complete the Business Combination with Cvent or, if we do not consummate such Business Combination, any other initial business combination;
|
• |
satisfaction or waiver of the conditions to the Business Combination including, among others: (i) the approval by our shareholders of the Condition Precedent Proposals being obtained; (ii) the applicable waiting period under the Hart-Scott-Rodino Act of 1976 (the “
HSR Act
”) relating to the Business Combination Agreement having expired or been terminated; (iii) Dragoneer having at least $5,000,001 of net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) after giving effect to the transactions contemplated by the Business Combination Agreement the PIPE Financing and the Forward Purchase Agreement; (iv) the shares of New Cvent Common Stock having been listed on Nasdaq, and Nasdaq having raised no objection to the continued listing of the New
|
Cvent Common Stock; and (v) as of immediately prior to the Closing, the result equal to: (a) the cash in the trust account, minus (b) the amount redeemed by the holders of Dragoneer Class A ordinary shares as provided in the Existing Governing Documents, plus (c) the aggregate amount received by Dragoneer from the PIPE Financing, plus (d) the aggregate amount received by Dragoneer under the Forward Purchase Agreement not being less than $356,000,000, subject to certain exceptions (which minimum cash amount shall be calculated without reduction for any payments in respect of debt repayments, transaction fees and expenses);
|
• |
the projected financial information, growth rate and market opportunity of New Cvent;
|
• |
the ability to obtain and/or maintain the listing of the New Cvent Common Stock on Nasdaq, and the potential liquidity and trading of such securities;
|
• |
the risk that the proposed Business Combination disrupts current plans and operations of Cvent as a result of the announcement and consummation of the proposed Business Combination;
|
• |
the ability to recognize the anticipated benefits of the proposed Business Combination, which may be affected by, among other things, competition, the ability of the combined company to grow and manage growth profitably and retain its key employees;
|
• |
costs related to the proposed Business Combination;
|
• |
changes in applicable laws or regulations;
|
• |
our ability to raise financing in the future;
|
• |
our success in retaining or recruiting, or changes required in, our officers, key employees or directors following the completion of the Business Combination;
|
• |
our officers and directors allocating their time to other businesses and potentially having conflicts of interest with our business or in approving the Business Combination;
|
• |
Cvent’s estimates regarding expenses, future revenue, capital requirements and needs for additional financing;
|
• |
Cvent’s financial performance;
|
• |
the ability of New Cvent to expand or maintain its existing customer base;
|
• |
the effect of global economic conditions or political transitions on Cvent’s customers and their ability to continue to purchase Cvent products;
|
• |
the effect of COVID-19 on the foregoing, including our ability to consummate the Business Combination due to the uncertainty resulting from the recent COVID-19 pandemic, and the impact on our virtual, hybrid and in-person offerings, each of which has been and may continue to be impacted differently by COVID-19; and
|
• |
other factors detailed under the section entitled “
Risk Factors
|
Q:
|
Why am I receiving this proxy statement/prospectus/consent solicitation?
|
A: |
Dragoneer shareholders are being asked to consider and vote upon, among other proposals, a proposal to approve and adopt the Business Combination Agreement and approve the transactions contemplated thereby, including the Business Combination. In accordance with the terms and subject to the conditions of the Business Combination Agreement, among other things, in connection with the Domestication, on the Closing Date prior to the First Effective Time, (i) Dragoneer will be renamed “Cvent Holding Corp.”, and (ii) each share and equity award of Cvent outstanding as of immediately prior to the First Effective Time will be exchanged for shares of New Cvent Common Stock or comparable equity awards that are settled or are exercisable for shares of New Cvent Common Stock, as applicable, based on an implied Cvent equity value of $4,467,973,959. See “
Business Combination Proposal
|
Q:
|
What proposals are shareholders of Dragoneer being asked to vote upon?
|
A: |
At the extraordinary general meeting, Dragoneer is asking holders of its ordinary shares to consider and vote upon the following separate proposals:
|
• |
a proposal to approve by ordinary resolution and adopt the Business Combination Agreement, including the Mergers, and the transactions contemplated thereby;
|
• |
a proposal to approve by special resolution the Domestication;
|
• |
the following five (5) separate proposals, on a non-binding advisory basis, to approve by ordinary resolution the following material differences between the Existing Governing Documents and the Proposed Governing Documents:
|
• |
to authorize the change in the authorized share capital of Dragoneer from US$22,100 divided into (i) 200,000,000 Class A ordinary shares, par value $0.0001 per share, 20,000,000 Class B ordinary shares, par value $0.0001 per share, and 1,000,000 preference shares, par value $0.0001 per share, to (ii) 1,500,000,000 shares of New Cvent Common Stock and 1,000,000 shares of New Cvent Preferred Stock;
|
• |
to authorize the New Cvent Board to issue any or all shares of New Cvent Preferred Stock in one or more classes or series, with such terms and conditions as may be expressly determined by the New Cvent Board and as may be permitted by the Delaware General Corporation Law (the “
DGCL
”);
|
• |
to provide that certain provisions of the certificate of incorporation of New Cvent are subject to the Investor Rights Agreement;
|
• |
to authorize the removal of the ability of New Cvent stockholders to take action by written consent in lieu of a meeting; and
|
• |
to amend and restate the Existing Governing Documents and authorize all other changes necessary or, as mutually agreed in good faith by Dragoneer and Cvent, desirable in connection with the replacement of Existing Governing Documents with the Proposed Governing Documents as part of the Domestication;
|
• |
a proposal to approve by ordinary resolution shares of New Cvent Common Stock in connection with the Business Combination, the Forward Purchase Agreement and the PIPE Financing in compliance with the Nasdaq Listing Rules;
|
• |
a proposal to approve and adopt by ordinary resolution the 2021 Plan;
|
• |
a proposal to approve and adopt by ordinary resolution the Employee Stock Purchase Plan; and
|
• |
a proposal to approve by ordinary resolution the adjournment of the extraordinary general meeting to a later date or dates, if necessary, to, among other things, permit further solicitation and vote of proxies in the event that there are insufficient votes for the approval of one or more proposals at the extraordinary general meeting.
|
Q:
|
Are the proposals conditioned on one another?
|
A: |
Each of the Business Combination Proposal, the Domestication Proposal, the Proposed Charter and Bylaws Proposal, the Nasdaq Proposal and the Incentive Equity Plan Proposal is conditioned on the approval and adoption of each of the other Condition Precedent Proposals. The Advisory Governing Documents Proposals are non-binding advisory proposals that are not conditions precedent to the consummation of the Business Combination and a vote against will have no impact on the provisions of the new certificate of incorporation or new bylaws of New Cvent. Neither the Adjournment Proposal nor the ESPP Proposal is conditioned on any other proposal.
|
Q:
|
Why is Dragoneer proposing the Business Combination?
|
A: |
Dragoneer is a blank check company incorporated on September 25, 2020 as a Cayman Islands exempted company and incorporated for the purpose of effecting a merger, share exchange, asset acquisition, share purchase, reorganization or similar business combination with one or more businesses. Although Dragoneer may pursue an acquisition opportunity in any business, industry, sector or geographical location for purposes of consummating the initial business combination, Dragoneer has focused on the software industry. Dragoneer is not permitted under its Existing Governing Documents to effect a business combination with a blank check company or a similar type of company with nominal operations.
|
Q:
|
Did the Dragoneer Board obtain a third-party valuation or fairness opinion in determining whether or not to proceed with the Business Combination?
|
A: |
No. The Dragoneer Board did not obtain a third-party valuation or fairness opinion in connection with its determination to approve the Business Combination, nor did it engage a financial advisor. However, Dragoneer’s management, the members of the Dragoneer Board and the other representatives of Dragoneer have substantial experience in evaluating the operating and financial merits of companies similar to Cvent and reviewed certain financial information of Cvent and compared it to certain publicly traded companies, selected based on the experience and the professional judgment of Dragoneer’s management team, which enabled them to make the necessary analyses and determinations regarding the Business Combination. Accordingly, investors will be relying solely on the judgment of the Dragoneer Board in valuing Cvent’s business and assuming the risk that the Dragoneer Board may not have properly valued such business.
|
Q:
|
What will Cvent’s equityholders receive in return for the Business Combination with Dragoneer?
|
A: |
On the date of Closing, promptly following the consummation of the Domestication, Merger Sub I will merge with and into Cvent (the “
First Merger
”), with Cvent as the surviving company in the First Merger and, after giving effect to such First Merger, Cvent will be a wholly-owned subsidiary of Dragoneer, and immediately following the First Merger and as part of the same overall transaction as the First Merger, Cvent as the surviving company of the First Merger will merge with and into Merger Sub II (the “
Second Merger
”), with Merger Sub II as the surviving company in the Second Merger and, after giving effect to such Second Merger, Merger Sub II will be a wholly-owned subsidiary of Dragoneer. In accordance with the terms and subject to the conditions of the Business Combination Agreement, at the First Effective Time, each share and equity award of Cvent outstanding as of immediately prior to the First Effective Time will be exchanged for shares of New Cvent Common Stock or comparable equity awards that are settled or are exercisable for shares of New Cvent Common Stock, as applicable, based on an implied Cvent equity value of $4,467,973,959.
|
Q:
|
How was the implied Cvent equity value of $4,467,973,959 determined?
|
A: |
The implied Cvent equity value of $4,467,973,959 was determined based on an implied pro forma enterprise value of New Cvent of approximately $5,345,493,959, including the anticipated $475 million PIPE Financing. As shown in the table below, the enterprise value was reduced by debt of approximately
|
$200,000,000 and increased by estimated pro forma cash of approximately $245,493,959, which yields an equity value of approximately $5,345,493,959. The implied equity value of Cvent of $4,467,973,959 represents the portion of the $877,520,000 pro forma equity value attributable to existing Cvent equityholders after taking into account 27,600,000 Class A ordinary shares held by existing Dragoneer shareholders, 5,000,000 shares to be issued pursuant to the Forward Purchase Agreement and the Business Combination Agreement, 47,500,000 shares to be issued in the PIPE Financing and 900,000 Class B ordinary shares held by the Sponsor that will not be subject to forfeiture following the consummation of the Business Combination. |
(amounts in millions, except per share amount) | ||||
Enterprise Value
|
$ | 5,300 | ||
Less: Debt
|
$ | 200 | ||
Plus: Cash
|
$ | 245 | ||
Equity Value
|
$ | 5,345 | ||
Price Per Share
|
$ | 10.00 | ||
Shares Outstanding
|
||||
Less: Class A Ordinary Shares
|
27,600,000 | |||
Less: Class A Private Placement Shares
|
752,000 | |||
Less: Class B Ordinary Shares Not Subject to Forfeiture
|
6,900,000 | |||
Less: Forward Purchase Agreement Shares
|
5,000,000 | |||
Less: PIPE Financing Shares
|
47,500,000 | |||
Equity to Existing Cvent Equityholders
|
446,797,396 |
Q:
|
How will the combined company be managed following the Business Combination?
|
A: |
Following the Closing, it is expected that the New Cvent Board will consist of individuals designated by Vista, the individual who will serve as New Cvent’s Chief Executive Officer (who shall be the Chief Executive Officer of Cvent as of immediately prior to the Mergers), and an individual who is “independent” and eligible under the listing rules of Nasdaq to serve on the New Cvent Board’s audit committee or one non-voting board observer. Please see the section entitled “
Management of New Cvent Following the Business Combination
|
Q:
|
What equity stake will current Dragoneer shareholders and current equityholders of Cvent hold in New Cvent immediately after the consummation of the Business Combination?
|
A: |
As of the date of this proxy statement/prospectus/consent solicitation, there are (i) 27,600,000 Class A ordinary shares outstanding issued in Dragoneer’s initial public offering, and (ii) 6,900,000 Class B ordinary shares outstanding held by Dragoneer’s Initial Shareholders. As of the date of this proxy statement/prospectus/consent solicitation, there is outstanding 752,000 private placement shares held by the Sponsor. The Sponsor intends to elect to have the $2,000,000 balance of a working capital loan provided to Dragoneer converted, in whole or in part, upon the consummation of the Business Combination, into Class A ordinary shares substantially identical to the private placements shares, at a price of $10.00 per share. Therefore, as of the date of this proxy statement/prospectus/consent solicitation (without giving effect to the Business Combination, the PIPE Financing or the conversion of the working capital loan into shares and assuming that none of Dragoneer’s outstanding public shares are redeemed in connection with the Business Combination), Dragoneer’s fully-diluted share capital would be 35,252,000 ordinary shares.
|
Assuming No
Redemptions (Shares) |
%
|
Assuming 50%
Redemptions (Shares) |
%
|
Assuming
Maximum Redemptions (Shares) |
%
|
|||||||||||||||||||
Cvent Stockholders
|
416,351,853 | 77.9 | % | 416,351,853 | 79.9 | % | 416,351,853 | 82.1 | % | |||||||||||||||
Cvent options (1)
|
30,445,543 | 5.7 | % | 30,445,543 | 5.8 | % | 30,445,543 | 6.0 | % | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total shares issued in Business Combination
|
|
446,797,396
|
|
83.6
|
%
|
446,797,396
|
|
85.8
|
%
|
|
446,797,396
|
|
|
88.1
|
%
|
|||||||||
Dragoneer’s public stockholders
|
27,600,000 | 5.2 | % | 13,800,000 | 2.6 | % | — | 0.0 | % | |||||||||||||||
Sponsor (2)
|
7,852,000 | 1.5 | % | 7,852,000 | 1.5 | % | 7,852,000 | 1.5 | % | |||||||||||||||
PIPE Investors (3)
|
52,500,000 | 9.8 | % | 52,500,000 | 10.1 | % | 52,500,000 | 10.4 | % | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Pro Forma Common Stock
|
|
534,749,396
|
|
|
100.0
|
%
|
|
520,949,396
|
|
|
100
|
%
|
|
507,149,396
|
|
|
100.0
|
%
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Represents shares underlying Cvent options calculated on a net exercise basis, which represents an aggregate 51,764,924 outstanding Cvent options less implied share buybacks of approximately 21,319,381.
|
(2) |
Includes 6,900,000 Class B ordinary shares held by the Initial Shareholders, 752,000 private placement shares held by the Sponsor and 200,000 Class A ordinary shares to be received by the Sponsor from the conversion of the promissory note upon the consummation of the Business Combination.
|
(3) |
Includes 47,500,000 shares of New Cvent Common Stock issued to the PIPE Investors in the PIPE Financing and 5,000,000 shares of Class A ordinary shares to be purchased by Dragoneer Funding II LLC pursuant to the Forward Purchase Agreement and the Business Combination Agreement.
|
Q:
|
Why is Dragoneer proposing the Domestication?
|
A: |
Our board of directors believes that there are significant advantages to us that will arise as a result of a change of our domicile to Delaware. Further, our board of directors believes that any direct benefit that the DGCL provides to a corporation also indirectly benefits its stockholders, who are the owners of the corporation. The board of directors believes that there are several reasons why transfer by way of continuation to Delaware is in the best interests of Dragoneer and its shareholders, including, (i) the prominence, predictability and flexibility of the DGCL, (ii) Delaware’s well-established principles of corporate governance and (iii) the increased ability for Delaware corporations to attract and retain qualified directors, each of the foregoing are discussed in greater detail in the section entitled “
Domestication Proposal—Reasons for the Domestication
|
Q:
|
What amendments will be made to the current constitutional documents of Dragoneer?
|
A: |
The consummation of the Business Combination is conditional, among other things, on the Domestication. Accordingly, in addition to voting on the Business Combination, Dragoneer’s shareholders also are being asked to consider and vote upon a proposal to approve the Domestication, and replace Dragoneer’s Existing Governing Documents, in each case, under Cayman Islands law with the Proposed Governing Documents, in each case, under the DGCL, which differ from the Existing Governing Documents in the following material respects:
|
Q:
|
How will the Domestication affect my ordinary shares?
|
A: |
In connection with the Domestication, on the Closing Date prior to the First Effective Time, but following the Domestication: (i) each issued and outstanding Class A ordinary share and each issued and outstanding Class B ordinary share, of Dragoneer will be converted into one share of common stock, par value $0.0001 per share, of New Cvent; (ii) the governing documents of Dragoneer will be amended and restated and become the certificate of incorporation and the bylaws of New Cvent as described in this proxy statement/prospectus/consent solicitation; and (iii) Dragoneer’s name will change to “Cvent Holding Corp.” Immediately prior to the First Effective Time, but following the Domestication, Dragoneer will issue the Forward Purchase Shares at a price of $10.00 per share on the terms and conditions set forth in the Forward Purchase Agreement and the Business Combination Agreement.
|
Q:
|
What are the U.S. federal income tax consequences of the Domestication?
|
A: |
As discussed more fully under “
U.S. Federal Income Tax Considerations
Code
”). However, due to the absence of direct guidance on the application of Section 368(a)(1)(F) to a statutory conversion of a corporation holding only investment-type assets such as Dragoneer, this result is not entirely clear. In the case of a transaction, such as the Domestication, that should qualify as a tax-deferred reorganization within the meaning of Section 368(a)(1)(F), U.S. Holders (as defined in “
U.S. Federal Income Tax Considerations—U.S. Holders
|
• |
a U.S. Holder whose public shares have a fair market value of less than $50,000 on the date of the Domestication generally will not recognize any gain or loss and will not be required to include any part of Dragoneer’s earnings in income;
|
• |
a U.S. Holder whose public shares have a fair market value of $50,000 or more and who, on the date of the Domestication, owns (actually and constructively) less than 10% of the total combined voting power of all classes of our stock entitled to vote and less than 10% of the total value of all classes of our stock generally will recognize gain (but not loss) on the exchange of public shares for shares of New Cvent Common Stock pursuant to the Domestication. As an alternative to recognizing gain, such U.S. Holder may file an election to include in income as a deemed dividend the “all earnings and profits amount” (as defined in the Treasury Regulations under Section 367(b) of the Code) attributable to its public shares provided certain other requirements are satisfied; and
|
• |
a U.S. Holder whose public shares have a fair market value of $50,000 or more and who, on the date of the Domestication, owns (actually or constructively) 10% or more of the total combined voting power of all classes of our stock entitled to vote or 10% or more of the total value of all classes of our stock generally will be required to include in income as a deemed dividend the “all earnings and profits amount” attributable to its public shares provided certain other requirements are satisfied. Any such U.S. Holder that is a corporation may, under certain circumstances, effectively be exempt from taxation on a portion or all of the deemed dividend pursuant to Section 245A of the Code (participation exemption).
|
Q:
|
Do I have redemption rights?
|
A: |
If you are a holder of public shares, you have the right to request that we redeem all or a portion of your public shares for cash provided that you follow the procedures and deadlines described elsewhere in this proxy statement/prospectus/consent solicitation.
Public shareholders may elect to redeem all or a portion of the public shares held by them regardless of if or how they vote in respect of the Business Combination Proposal
How do I exercise my redemption rights?
|
Q:
|
How do I exercise my redemption rights?
|
A: |
In connection with the proposed Business Combination, pursuant to the Existing Governing Documents, Dragoneer’s public shareholders may request that Dragoneer redeem all or a portion of such public shares for cash if the Business Combination is consummated. If you are a public shareholder and wish to exercise your right to redeem the public shares, you must:
|
(i) |
hold public shares;
|
(ii) |
submit a written request to Continental, Dragoneer’s transfer agent, in which you (i) request that we redeem all or a portion of your public shares for cash, and (ii) identify yourself as the beneficial holder of the public shares and provide your legal name, phone number and address; and
|
(iii) |
deliver your share certificates (if any) and other redemption forms (as applicable) to Continental, our transfer agent, physically or electronically through The Depository Trust Company (“
DTC
”).
|
Q:
|
What are the U.S. federal income tax consequences of exercising my redemption rights?
|
A: |
We expect that a U.S. Holder (as defined in “
U.S. Federal Income Tax Considerations—U.S. Holders
U.S. Federal Income Tax Considerations.
|
Q:
|
What happens to the funds deposited in the trust account after consummation of the Business Combination?
|
A: |
Following the closing of our initial public offering, an amount equal to $276,000,000 ($10.00 per share) of the net proceeds from our initial public offering was placed in the trust account. As of June 30, 2021, assets held in the trust account totaled $276,008,777 and were held in money market funds, which are invested primarily in U.S. treasury securities. These funds will remain in the trust account, except for the withdrawal of interest to pay taxes, if any, until the earliest of (i) the completion of a business combination (including the closing of the Business Combination) or (ii) the redemption of all of the public shares if we are unable to
|
complete a business combination by February 19, 2023 (unless such date is extended in accordance with the Existing Governing Documents), subject to applicable law. |
Q:
|
What happens if a substantial number of the public shareholders vote in favor of the Business Combination Proposal and exercise their redemption rights?
|
A: |
Our public shareholders are not required to vote “AGAINST” the Business Combination in order to exercise their redemption rights. Accordingly, the Business Combination may be consummated even though the funds available from the trust account and the number of public shareholders are reduced as a result of redemptions by public shareholders.
|
Q:
|
What conditions must be satisfied to complete the Business Combination?
|
A: |
The consummation of the Business Combination is conditioned upon, among other things, (i) the applicable waiting period under the HSR Act relating to the transactions contemplated by the Business Combination Agreement having expired or been terminated; (ii) no judicial or governmental order, prohibition or other legal restraint preventing the consummation of the transactions contemplated by the Business Combination Agreement; (iii) this Registration Statement on Form S-4 having become effective; (iv) the shareholders of Dragoneer and Cvent having consented to the Business Combination Agreement and consummation of the transactions contemplated therein; (v) Dragoneer having at least $5,000,001 of net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) after giving effect to the transactions contemplated by the Business Combination Agreement, the Forward Purchase Agreement and the PIPE Financing; (vi) the shares of New Cvent Common Stock having been listed on Nasdaq, and Nasdaq having raised no objection to the continued listing of the New Cvent Common Stock; and (vii) as of immediately prior to the Closing, the result equal to: (a) the cash in the trust account, minus (b) the amount redeemed by the holders of Dragoneer Class A ordinary shares as provided in the Existing Governing Documents, plus (c) the aggregate amount received by Dragoneer from the PIPE Financing, plus (d) the aggregate amount received by Dragoneer under the Forward Purchase Agreement not being less than $356,000,000, subject to certain exceptions. The minimum cash amount shall be calculated without reduction for any payments in respect of debt repayments, transaction fees and expenses. Therefore, unless these conditions are waived by the applicable parties to the Business Combination Agreement, the Business Combination Agreement could terminate and the Business Combination may not be consummated.
|
Q:
|
When do you expect the Business Combination to be completed?
|
A: |
It is currently expected that the Business Combination will be consummated in the fourth quarter of 2021. This date depends, among other things, on the approval of the proposals to be put to Dragoneer shareholders at the extraordinary general meeting. However, such extraordinary general meeting could be adjourned if
|
the Adjournment Proposal is adopted by our shareholders at the extraordinary general meeting and we elect to adjourn the extraordinary general meeting to a later date or dates, if necessary (i) to solicit additional proxies for the purpose of obtaining approval by the Dragoneer shareholders for each of the proposals necessary to consummate the Business Combination Agreement (ii) for the absence of a quorum, (iii) to allow reasonable additional time for the filing or mailing of any supplemental or amended disclosures that Dragoneer has determined, based on the advice of outside legal counsel, is reasonably likely to be required under applicable law and for such supplemental or amended disclosure to be disseminated and reviewed by the Class A ordinary shareholders prior to the extraordinary general meeting or (iv) if the holders of holders of the Class A ordinary shares have elected to redeem a number of Class A ordinary shares as of such time that would reasonably be expected to result in the conditions required for the Closing of the Business Combination Agreement not to be satisfied; provided that, without the consent of Cvent, in no event shall the extraordinary general meeting of shareholders be adjourned on more than two (2) occasions or for more than fifteen (15) business days later than the most recently adjourned meeting or to a date that is beyond the termination date of the Business Combination Agreement. For a description of the conditions for the completion of the Business Combination, see “
Business Combination Proposal—Conditions to Closing of the Business Combination
|
Q:
|
What happens if the Business Combination is not consummated?
|
A: |
Dragoneer will not complete the Domestication to Delaware unless all other conditions to the consummation of the Business Combination have been satisfied or waived by the parties in accordance with the terms of the Business Combination Agreement. If Dragoneer is not able to consummate the Business Combination with Cvent nor able to complete another business combination by February 19, 2023, as such date may be extended pursuant to our Existing Governing Documents, we will (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem the public shares, at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the trust account, including interest (which interest shall be net of taxes payable, and less up to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding public shares, which redemption will completely extinguish public shareholders’ rights as shareholders (including the right to receive further liquidating distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption, subject to the approval of our remaining shareholders and our board of directors, liquidate and dissolve, subject in each case to our obligations under Cayman Islands law to provide for claims of creditors and the requirements of other applicable laws.
|
Q:
|
Do I have appraisal rights in connection with the proposed Business Combination and the proposed Domestication?
|
A: |
Dragoneer shareholders do not have appraisal rights in connection with the Business Combination or the Domestication under the Cayman Islands Companies Act or under the DGCL.
|
Q:
|
What do I need to do now?
|
A: |
You should read this proxy statement/prospectus/consent solicitation, including the Annexes and the documents referred to herein, carefully and in their entirety and to consider how the Business Combination will affect you as a shareholder. Our shareholders should then vote as soon as possible in accordance with the instructions provided in this proxy statement/prospectus/consent solicitation and on the enclosed proxy card.
|
Q:
|
How do I vote?
|
A: |
If you hold your shares in “street name,” which means your shares are held of record by a broker, bank or nominee, and were a holder of record of ordinary shares on [●], 2021, the record date for the extraordinary general meeting, you may vote with respect to the proposals in person or virtually at the extraordinary general meeting, or by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided. For the avoidance of doubt, the record date does not apply to Dragoneer shareholders that hold their shares in registered form and are registered as shareholders in Dragoneer’s register of members. All holders of shares in registered form on the day of the extraordinary general meeting are entitled to vote at the extraordinary general meeting.
|
Q:
|
If my shares are held in “street name,” will my broker, bank or nominee automatically vote my shares for me?
|
A: |
No. If your shares are held in a stock brokerage account or by a bank or other nominee, you are considered the “beneficial holder” of the shares held for you in what is known as “street name.” If this is the case, this proxy statement/prospectus/consent solicitation may have been forwarded to you by your brokerage firm, bank or other nominee, or its agent. As the beneficial holder, you have the right to direct your broker, bank or other nominee as to how to vote your shares. If you do not provide voting instructions to your broker on a particular proposal on which your broker does not have discretionary authority to vote, your shares will not be voted on that proposal. This is called a “broker non-vote.” Abstentions and broker non-votes, while considered present for the purposes of establishing a quorum, will not count as votes cast at the extraordinary general meeting, and otherwise will have no effect on a particular proposal. If you decide to vote, you should provide instructions to your broker, bank or other nominee on how to vote in accordance with the information and procedures provided to you by your broker, bank or other nominee.
|
Q:
|
When and where will the extraordinary general meeting be held?
|
A: |
The extraordinary general meeting will be held at [●], Eastern Time, on [●], 2021, at [●], or virtually live via webcast at [●], or such other date, time and place to which such meeting may be adjourned or postponed, to consider and vote upon the proposals.
|
Q:
|
How will the COVID-19 pandemic impact in-person voting at the General Meeting?
|
A: |
We intend to hold the extraordinary general meeting in person. However, we are sensitive to the public health and travel concerns our shareholders may have and recommendations that public health officials may issue in light of the evolving coronavirus (COVID-19) situation. As a result, we may impose additional procedures or limitations on meeting attendees. We plan to announce any such updates in a press release filed with the SEC and on our proxy website at [●], and we encourage you to check this website prior to the meeting if you plan to attend.
|
Q:
|
What impact will the COVID-19 Pandemic have on the Business Combination?
|
A: |
Given the ongoing and dynamic nature of the circumstances, it is difficult to predict the impact of the coronavirus outbreak on the business of Dragoneer and Cvent, and there is no guarantee that efforts by Dragoneer and Cvent to address the adverse impacts of the coronavirus will be effective. The extent of such impact will depend on future developments, which are highly uncertain and cannot be predicted, including new information which may emerge concerning the severity of the coronavirus and actions taken to contain the coronavirus or its impact, among others. If Dragoneer or Cvent are unable to recover from a business disruption on a timely basis, the Business Combination and New Cvent’s business, financial condition and results of operations following the completion of the Business Combination would be adversely affected. The Business Combination may also be delayed and adversely affected by the coronavirus outbreak and become more costly. Each of Dragoneer and Cvent may also incur additional costs to remedy damages caused by any such disruptions, which could adversely affect its financial condition and results of operations.
|
Q:
|
Who is entitled to vote at the extraordinary general meeting?
|
A: |
We have fixed [●], 2021 as the record date for the extraordinary general meeting. If you were a shareholder of Dragoneer at the close of business on the record date, you are entitled to vote on matters that come before the extraordinary general meeting. However, a shareholder may only vote his or her shares if he, she or they is present in person or is represented by proxy at the extraordinary general meeting.
|
Q:
|
How many votes do I have?
|
A: |
With the exception of our Initial Shareholders, who are entitled to ten votes for each Class B ordinary share they hold for purposes of voting on the Domestication Proposal, Dragoneer shareholders are entitled to one vote at the extraordinary general meeting for each ordinary share held of record as of the record date. As of the close of business on the record date for the extraordinary general meeting, there were 27,600,000 Class A ordinary shares issued and outstanding and 6,900,000 Class B ordinary shares issued and outstanding, all of which are held by the Initial Shareholders.
|
Q:
|
What constitutes a quorum?
|
A: |
A quorum of Dragoneer shareholders is necessary to hold a valid meeting. A quorum will be present at the extraordinary general meeting if one or more shareholders who together hold not less than a majority of the issued and outstanding ordinary shares entitled to vote at the extraordinary general meeting are represented in person or by proxy at the extraordinary general meeting. As of the record date for the extraordinary general meeting, 17,626,001 ordinary shares (or, excluding the ordinary shares held by the Initial Shareholders, 13,800,001 ordinary shares) would be required to achieve a quorum for each proposal contained in this proxy statement, except as to the Domestication Proposal, wherein representation of the Initial Shareholders alone will be sufficient for a quorum.
|
Q:
|
What vote is required to approve each proposal at the extraordinary general meeting?
|
A: |
The following votes are required for each proposal at the extraordinary general meeting:
|
(i) |
Business Combination Proposal:
|
(ii) |
Domestication Proposal:
|
(iii) |
Proposed Charter and Bylaws Proposal
|
(iv) |
Advisory Governing Documents Proposals:
|
(v) |
Nasdaq Proposal:
|
(vi) |
Incentive Equity Plan Proposal:
|
(vii) |
ESPP Proposal
|
(viii) |
Adjournment Proposal:
|
Q:
|
What are the recommendations of the Dragoneer Board?
|
A: |
The Dragoneer Board believes that the Business Combination Proposal and the other proposals to be presented at the extraordinary general meeting are in the best interest of Dragoneer and its shareholders and unanimously recommends that its shareholders vote “FOR” the Business Combination Proposal, “FOR” the Domestication Proposal, “FOR” the Proposed Charter and Bylaws Proposal, “FOR” each of the separate Advisory Governing Documents Proposals, “FOR” the Nasdaq Proposal, “FOR” the Incentive Equity Plan Proposal, “FOR” the ESPP Proposal and “FOR” the Adjournment Proposal, in each case, if presented to the extraordinary general meeting.
|
Q:
|
How do Sponsor and the other Initial Shareholders intend to vote their shares?
|
A: |
Unlike some other blank check companies in which the Initial Shareholders agree to vote their shares in accordance with the majority of the votes cast by the public shareholders in connection with an initial business combination, our Initial Shareholders have agreed to vote all of their shares in favor of all the proposals being presented at the extraordinary general meeting. As of the date of this proxy statement/prospectus/consent solicitation, our Initial Shareholders own approximately 21.7% of the issued and outstanding ordinary shares.
|
Q:
|
What happens if I sell my Dragoneer ordinary shares before the extraordinary general meeting?
|
A: |
The record date for the extraordinary general meeting is earlier than the date of the extraordinary general meeting and earlier than the date that the Business Combination is expected to be completed. If you transfer your public shares after the applicable record date, but before the extraordinary general meeting, unless you grant a proxy to the transferee, you will retain your right to vote at such general meeting.
|
Q:
|
May I change my vote after I have mailed my signed proxy card?
|
A: |
Yes. Shareholders may send a later-dated, signed proxy card to our general counsel at our address set forth below so that it is received by our general counsel prior to the vote at the extraordinary general meeting (which is scheduled to take place on [●], 2021) or attend the extraordinary general meeting in person and vote. Shareholders also may revoke their proxy by sending a notice of revocation to our general counsel, which must be received by our general counsel prior to the vote at the extraordinary general meeting. However, if your shares are held in “street name” by your broker, bank or another nominee, you must contact your broker, bank or other nominee to change your vote.
|
Q:
|
What happens if I fail to take any action with respect to the extraordinary general meeting?
|
A: |
If you fail to vote with respect to the extraordinary general meeting and the Business Combination is approved by shareholders and the Business Combination is consummated, you will become a stockholder of New Cvent. If you fail to vote with respect to the extraordinary general meeting and the Business Combination is not approved, you will remain a shareholder of Dragoneer. However, if you fail to vote with respect to the extraordinary general meeting, you will nonetheless be able to elect to redeem your public shares in connection with the Business Combination.
|
Q:
|
What should I do if I receive more than one set of voting materials?
|
A: |
Shareholders may receive more than one set of voting materials, including multiple copies of this proxy statement/prospectus/consent solicitation and multiple proxy cards or voting instruction cards. For example, if you hold your shares in more than one brokerage account, you will receive a separate voting instruction card for each brokerage account in which you hold shares. If you are a holder of record and your shares are registered in more than one name, you will receive more than one proxy card. Please complete, sign, date and return each proxy card and voting instruction card that you receive in order to cast a vote with respect to all of your ordinary shares.
|
Q:
|
Who will solicit and pay the cost of soliciting proxies for the extraordinary general meeting?
|
A: |
Dragoneer will pay the cost of soliciting proxies for the extraordinary general meeting. Dragoneer has engaged Morrow Sodali to assist in the solicitation of proxies for the extraordinary general meeting. Dragoneer has agreed to pay Morrow Sodali a fee of $35,000, plus disbursements, and will reimburse Morrow Sodali for its reasonable out-of-pocket expenses and indemnify Morrow Sodali and its affiliates against certain claims, liabilities, losses, damages and expenses. Dragoneer will also reimburse banks, brokers and other custodians, nominees and fiduciaries representing beneficial owners of Class A ordinary shares for their expenses in forwarding soliciting materials to beneficial owners of Class A ordinary shares and in obtaining voting instructions from those owners. Dragoneer’s directors and officers may also solicit proxies by telephone, by facsimile, by mail, on the Internet or in person. They will not be paid any additional amounts for soliciting proxies.
|
Q:
|
Where can I find the voting results of the extraordinary general meeting?
|
A: |
The preliminary voting results will be announced at the extraordinary general meeting. Dragoneer will publish final voting results of the extraordinary general meeting in a Current Report on Form 8-K within four business days after the extraordinary general meeting.
|
Q:
|
Who can help answer my questions?
|
A: |
If you have questions about the Business Combination or if you need additional copies of the proxy statement/prospectus/consent solicitation or the enclosed proxy card you should contact:
|
Q:
|
Why am I receiving this proxy statement/prospectus/consent solicitation statement?
|
A: |
The Cvent Stockholders are being asked to (i) adopt the Business Combination Agreement and approve the transactions contemplated thereby, including the Business Combination and (ii) approve, on a non-binding advisory basis, each of the amendments described in Proposal Nos. 3-7 of this proxy statement/prospectus/consent solicitation statement by executing and delivering the written consent furnished with this proxy statement/prospectus/consent solicitation statement. As a result of the Business Combination, Dragoneer will acquire Cvent. Subject to the terms of the Business Combination Agreement, holders of Cvent equity interests (and convertible securities) will be entitled to receive shares of New Cvent Common Stock at a deemed value of $10.00 per share as consideration following the Mergers. For more information about the consideration payable to the holders of Cvent equity interests, please see the section titled “
Business Combination Proposal—
Consideration to Cvent Equityholders in the Business Combination
|
Q:
|
Who is entitled to act by written consent?
|
A: |
The Cvent Stockholders of record holding shares of Cvent common stock at the close of business on the record date of [●], 2021 (the “
Cvent Record Date
”), will be notified of and be entitled to execute and deliver a written consent with respect to the written consent distributed with this proxy statement/prospectus/consent solicitation statement.
|
Q:
|
How can I give my consent?
|
A: |
The Cvent Stockholders may give their consent by completing, dating and signing the written consent distributed with this proxy statement/prospectus/consent solicitation statement. The Cvent Stockholders may either electronically sign the written consent sent by Cvent to each Cvent Stockholder’s electronic address on record at Cvent or manually sign and email a scanned copy of the Cvent Stockholder’s signature page to Cvent’s legal team at the following email address: legal@cvent.com.
|
Q:
|
What is the deadline for returning my consent?
|
A: |
The targeted final date for the receipt of written consents (the “
target date
”) is currently [●] p.m., Eastern Time, on [●], 2021. Cvent reserves the right to extend the final date for the receipt of written consents beyond the target date. Any such extension may be made without notice to Cvent Stockholders. The delivery of the written consent by each of the Cvent Supporting Shareholders pursuant to the Cvent Shareholder Transaction Support Agreements will be sufficient to adopt the Business Combination Agreement and approve the transactions contemplated thereby, including the Business Combination.
|
Q:
|
What approval is required to adopt the Business Combination Agreement?
|
A: |
In order to consummate the Business Combination, Cvent holders of a majority of the outstanding shares of Cvent common stock (the “
Cvent Requisite Approval
”) must adopt the Business Combination Agreement.
|
The Cvent Requisite Approval is the only vote of the holders of capital stock of Cvent required to adopt the Business Combination Agreement and approve the transactions contemplated thereby, including the Business Combination. |
Q:
|
Can I dissent and require appraisal of my Cvent stock?
|
A: |
If you are a Cvent Stockholder who does not deliver a written consent adopting the Business Combination Agreement and approving the transactions contemplated thereby, including the Business Combination, you will, if you comply with Section 262 of the DGCL, be entitled to appraisal rights. The full text of Section 262 of the DGCL is attached as Annex M to this proxy statement/prospectus/consent solicitation statement. Failure to follow any of the statutory procedures set forth in Annex M will result in the loss or waiver of appraisal rights under Delaware law. Delaware law requires that, among other things, you send a written demand for appraisal to Cvent after receiving a notice that appraisal rights are available to you, which notice will be sent to non-consenting Cvent Stockholders in the future. This proxy statement/prospectus/consent solicitation statement is not intended to constitute such a notice. Do not send in your demand before the date of such notice because a demand for appraisal made prior to the date of giving of such notice may not be effective to perfect your rights. For more information, see the section titled “
Appraisal Rights
|
Q:
|
Who should I contact if I have any questions about the consent solicitation?
|
A: |
If you have any questions about the Business Combination or how to execute your written consent electronically or if you need additional copies of this proxy statement/prospectus/consent solicitation statement or a replacement written consent, you should contact the Cvent team at the following email address: legal@cvent.com.
|
• |
Advisory Governing Documents Proposal A
|
• |
Advisory Governing Documents Proposal B
|
• |
Advisory Governing Documents Proposal C
|
• |
Advisory Governing Documents Proposal D
|
• |
Advisory Governing Documents Proposal E
|
• |
Strong Historical Consolidated Financial Performance and Economic Model
|
recurring revenue model serving large customers with long-standing customer relationships, as reflected in its strong Adjusted Gross Margin numbers and pre-COVID net dollar retention;
|
• |
Favorable Prospects for Future Growth and Financial Performance
|
• |
Differentiated Technology Platform
|
• |
Positioned for Future Growth.
|
• |
Competitive Differentiation that Increases with Scale
|
• |
Proven R&D Engine with an Exciting Product Roadmap
|
|
• |
Compelling Valuation
|
• |
World Class Management Team
|
• |
PIPE Financing Success
|
• |
Terms of the Business Combination Agreement and the Related Agreements
|
• |
Likelihood of Closing the Business Combination
|
• |
Benefits May Not Be Achieved
|
• |
Exercise of Redemption Rights of Current Public Shareholders
Risk Factors
|
• |
Conditions to Closing of the Business Combination
|
• |
Control of New Cvent by the Vista Investors Following Consummation of the Business Combination
|
• |
Litigation Related to the Business Combination
|
• |
Transaction Expenses Incurred by Dragoneer
|
• |
Negative Impact Resulting from the Announcement of the Business Combination
|
• |
Commitment under the Business Combination Agreement
|
• |
Other Risks
Risk Factors
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assuming No
Redemptions (Shares) |
%
|
Assuming
Maximum Redemptions (Shares) |
%
|
|||||||||||||
Cvent Stockholders
|
416,351,853 | 77.9 | % | 416,351,853 | 82.1 | % | ||||||||||
Cvent options (1)
|
30,445,543 | 5.7 | % | 30,445,543 | 6.0 | % | ||||||||||
|
|
|
|
|
|
|
|
|
||||||||
Total shares issued in Business Combination
|
|
446,797,396
|
|
|
83.6
|
%
|
|
446,797,396
|
|
|
88.1
|
%
|
||||
Dragoneer’s public stockholders
|
27,600,000 | 5.2 | % | — | 0.0 | % | ||||||||||
Sponsor (2)
|
7,852,000 | 1.5 | % | 7,852,000 | 1.5 | % | ||||||||||
PIPE Investors (3)
|
52,500,000 | 9.8 | % | 52,500,000 | 10.4 | % | ||||||||||
|
|
|
|
|
|
|
|
|
||||||||
Pro Forma Common Stock
|
|
534,749,396
|
|
|
100.0
|
%
|
|
507,149,396
|
|
|
100.0
|
%
|
||||
|
|
|
|
|
|
|
|
|
(1) |
Represents shares underlying Cvent options calculated on a net exercise basis, which represents an aggregate 51,764,924 outstanding Cvent options less implied share buybacks of approximately 21,319,381.
|
(2) |
Includes 6,900,000 Class B ordinary shares held by the Initial Shareholders, 752,000 private placement shares held by the Sponsor and 200,000 Class A ordinary shares to be received by the Sponsor from the conversion of the promissory note upon the consummation of the Business Combination.
|
(3)
|
Includes 47,500,000 shares of New Cvent Common Stock issued to the PIPE Investors in the PIPE Financing and 5,000,000 shares of Class A ordinary shares to be purchased by Dragoneer Funding II LLC pursuant to the Forward Purchase Agreement and the Business Combination Agreement.
|
(i) |
Business Combination Proposal:
|
(ii) |
Domestication Proposal:
|
(iii) |
Proposed Charter and Bylaws Proposal
|
(iv) |
Advisory Governing Documents Proposals:
|
(v) |
Nasdaq Proposal:
|
(vi) |
Incentive Equity Plan Proposal:
|
(vii) |
ESPP Proposal
|
(viii) |
Adjournment Proposal:
|
(i) |
hold public shares;
|
(ii) |
submit a written request to Continental, Dragoneer’s transfer agent, in which you (i) request that New Cvent redeem all or a portion of your public shares for cash, and (ii) identify yourself as the beneficial holder of the public shares and provide your legal name, phone number and address; and
|
(iii) |
deliver your share certificates (if any) and other redemption forms (as applicable) to Continental, Dragoneer’s transfer agent, physically or electronically through DTC.
|
• |
the fact that our Initial Shareholders have agreed not to redeem any Class A ordinary shares held by them in connection with a shareholder vote to approve a proposed initial business combination;
|
• |
the fact that the Sponsor paid an aggregate of $25,000 for the 6,900,000 Class B ordinary shares currently owned by the Initial Shareholders and such securities will have a significantly higher value at the time of the Business Combination;
|
• |
the fact that Sponsor paid $7,520,000 for its private placement shares which would be worthless if a business combination is not consummated by February 19, 2023 (unless such date is extended in accordance with the Existing Governing Documents);
|
• |
the fact that Sponsor, the Initial Shareholders and Dragoneer’s other current officers and directors have agreed to waive their rights to liquidating distributions from the trust account with respect to any ordinary shares (other than public shares) held by them if Dragoneer fails to complete an initial business combination by February 19, 2023;
|
• |
the fact that the Amended and Restated Registration Rights Agreement will be entered into by Dragoneer’s independent directors;
|
• |
the fact that the Forward Purchaser agreed to purchase the Forward Purchase Shares immediately prior to the First Effective Time, but following the Domestication;
|
• |
the fact that, at the option of the Sponsor, any amounts outstanding under the loan made by the Sponsor to Dragoneer in an aggregate amount of up to $2,000,000 may be converted into Class A ordinary shares in connection with the consummation of the Business Combination;
|
• |
the continued indemnification of Dragoneer’s directors and officers and the continuation of Dragoneer’s directors’ and officers’ liability insurance after the Business Combination (i.e., a “tail policy”);
|
• |
the fact that the Sponsor and Dragoneer’s officers and directors will lose their entire investment in Dragoneer and will not be reimbursed for any out-of-pocket expenses if an initial business combination is not consummated by February 19, 2023;
|
• |
the fact that if the trust account is liquidated, including in the event Dragoneer is unable to complete an initial business combination by February 19, 2023, the Sponsor has agreed to indemnify Dragoneer to ensure that the proceeds in the trust account are not reduced below $10.00 per public share, or such lesser per public share amount as is in the trust account on the liquidation date, by the claims of prospective target businesses with which Dragoneer has entered into an acquisition agreement or claims of any third party for services rendered or products sold to Dragoneer, but only if such a vendor or target business has not executed a waiver of any and all rights to seek access to the trust account;
|
• |
the fact that Dragoneer may be entitled to distribute or pay over funds held by Dragoneer outside the Trust Account to the Sponsor or any of its affiliates prior to the Closing;
|
• |
the fact that the Sponsor sponsors multiple SPACs and is affiliated with a number of other investment vehicles and has the sole discretion to allocation this transaction to Dragoneer taking into account whatever factors it deems appropriate; and
|
• |
the fact that, based on the difference in the purchase price of approximately $0.008 per share that the Sponsor paid for the Founder Shares (as defined below), as compared to the purchase price of $10.00 per share sold in Dragoneer’s initial public offering, the Sponsor may earn a positive rate of return on its investment even if the share price of New Cvent Common Stock falls significantly below the per share value implied in the Business Combination of $10.00 per share and the public stockholders of Dragoneer experience a negative rate of return.
|
• |
Certain of Cvent’s executive officers hold shares of Cvent stock, the treatment of which is described in the section titled “Proposal No. 1—The Business Combination Proposal.” Please see the section titled “Beneficial Ownership of Securities” for more information regarding the shares of Cvent stock held by Cvent’s executive officers.
|
• |
Certain of Cvent’s executive officers and non-employee directors hold options to purchase shares of Cvent common stock, which will be assumed by New Cvent upon the consummation of the Business Combination. The treatment of such equity awards in connection with the Business Combination is described in the section titled “Proposal No. 1—The Business Combination Proposal.” Please see the section titled “Beneficial Ownership of Securities” for more information regarding the shares of Cvent stock held by Cvent’s executive officers and non-employee directors.
|
• |
The non-employee directors of Cvent have a direct or indirect ownership interest in Cvent stock, which are described in the section titled “Beneficial Ownership of Securities.”
|
• |
New Cvent’s directors and executive officers will be eligible to receive equity grants under the 2021 Plan, under which [•] shares of New Cvent Common Stock may be awarded. For additional information, please see the section titled “Proposal No. 6—The Incentive Equity Plan Proposal.”
|
• |
Certain of Cvent’s directors and executive officers are expected to become directors and/or executive officers of New Cvent upon the consummation of the Business Combination. Specifically, the following individuals who are currently executive officers of Cvent are expected to become executive officers of New Cvent upon the consummation of the Business Combination, serving in the offices set forth opposite their names below.
|
Name
|
Age
|
Position
|
||||
Rajeev K. Aggarwal
|
52 | Founder, Chief Executive Officer and Director Nominee | ||||
Charles Ghoorah
|
51 | Co-founder, President of Worldwide Sales and Marketing | ||||
David Quattrone
|
48 | Co-founder, Chief Technology Officer | ||||
William J. Newman, III
|
46 | Senior Vice President and Chief Financial Officer | ||||
Lawrence J. Samuelson
|
51 | Senior Vice President, General Counsel and Corporate Secretary |
• |
In addition, the following individuals who are currently directors of Cvent are expected to become directors of New Cvent upon the consummation of the Business Combination: Rajeev K. Aggarwal, Maneet Saroya, Betty Hung and [●].
|
• |
At the closing of the Business Combination, New Cvent will enter into the Amended and Restated Registration Rights Agreement with the Registration Rights Investors (in which certain members of the Cvent Board and affiliates are included), which provides for registration rights to Registration Rights Investors and their permitted transferees.
|
Source of Funds(1)
(in millions)
|
Uses(1)
(in millions) |
|||||||||
Existing Cash held in trust account(2)
|
$ | 276 |
Equity Consideration of New Cvent Common Stock issued to Cvent Equityholders(3)
|
$ | 4,468 | |||||
Shares of New Cvent Common Stock issued to Cvent Equityholders(3)
|
4,468 |
Transaction Fees and Expenses
|
65 | |||||||
PIPE Financing
|
475 |
Remaining Cash Proceeds on Balance Sheet
|
153 | |||||||
Forward Purchase Agreement
|
50 |
Debt Paydown(4)
|
583 | |||||||
|
|
|
|
|||||||
Total Sources
|
$ | 5,269 |
Total Uses
|
$ | 5,269 | |||||
|
|
|
|
(1) |
Totals might be affected by rounding.
|
(2) |
As of June 30, 2021.
|
(3) |
Shares issued to Cvent are at a deemed value of $10.00 per share. Assumes 446,797,396 shares are issued to the Cvent equityholders, net of implied share buybacks of approximately 21,319,381.
|
(4) |
In connection with the Business Combination, Cvent expects to repay $583.0 million of existing Cvent debt but may pay down more or less depending on the amount remaining in the trust fund at Closing and actual transaction expenses.
|
Source of Funds(1)
(in millions) |
Uses(1)
(in millions) |
|||||||||
Existing Cash held in trust account
|
$ | 0 |
Equity Consideration of New Cvent Common Stock issued to Cvent Equityholders(2)
|
$ | 4,468 | |||||
Shares of New Cvent Common Stock issued to Cvent Equityholders(2)
|
4,468 |
Estimated Transaction Fees and Expenses
|
65 | |||||||
PIPE Financing
|
475 |
Remaining Cash Proceeds on Balance Sheet(3)
|
3 | |||||||
Forward Purchase Agreement
|
50 |
Debt Paydown(4)
|
457 | |||||||
|
|
|
|
|||||||
Total Sources
|
$ | 4,993 |
Total Uses
|
$ | 4,993 | |||||
|
|
|
|
(1) |
Totals might be affected by rounding.
|
(2) |
Shares issued to Cvent are at a deemed value of $10.00 per share. Assumes 446,797,396 shares are issued to the Cvent equityholders, net of implied share buybacks of approximately 21,319,381.
|
(3) |
Does not include the $2,000,000 loan obtained from the Sponsor.
|
(4) |
In connection with the Business Combination, Cvent expects to repay $457.0 million of existing Cvent debt, but may pay down more or less depending on the amount remaining in the trust fund at the Closing and actual transaction expenses.
|
• |
Cvent’s existing stockholders will have a majority of the voting power in New Cvent, irrespective of whether Dragoneer’s public shareholders exercise their right to redeem their public shares;
|
• |
Cvent’s current largest shareholders will have the ability to nominate a majority of the initial members of the New Cvent Board;
|
• |
Cvent’s senior management will be the senior management of New Cvent;
|
• |
Cvent’s operations prior to the Business Combination will comprise the ongoing operations of New Cvent;
|
• |
Cvent is the larger entity based on historical operating activity and has the larger employee base; and
|
• |
The post-combination company will assume a “Cvent”-branded name: “Cvent Holding Corp.”
|
• |
Cvent is substantially dependent upon the addition of new customers and the continued growth of the market for its event marketing and management solutions.
|
• |
Cvent’s Hospitality Cloud business depends on maintaining and expanding its relationships with hotels and venues.
|
• |
Data published by third parties and internally generated data and assumptions may prove to be inaccurate. In particular, the estimates of market opportunity and forecasts of market growth included in this proxy statement/prospectus/consent solicitation may prove to be inaccurate, and even if the market in which Cvent competes achieves the forecasted growth, Cvent’s business could fail to grow at similar rates, if at all.
|
• |
If the security of Cvent or its customers’ confidential or personal information stored in Cvent’s or its third-party service providers’ systems is breached or otherwise subjected to unauthorized access, Cvent’s business could be materially and adversely affected, its reputation may be severely harmed and it may be exposed to liability.
|
• |
Cvent has indemnity provisions under its contracts with its customers, vendors, lessors, business partners and other parties, which could have a material adverse effect on Cvent’s business.
|
• |
Cvent faces significant competition from established and new companies offering event marketing and management software.
|
• |
Disruption of Cvent’s operations, infrastructure or systems, or disruption of the operations, infrastructure or systems of the third parties on which Cvent relies, could damage Cvent’s reputation and result in credits to customers or a loss of users, which would harm Cvent’s business and operating results.
|
• |
Cvent’s business depends substantially on renewing agreements with existing customers and selling additional solutions to them. Any decline in—or failure to grow—Cvent’s customer renewals or expansions would likely harm its future operating results.
|
• |
Cvent targets large customers, and sales to these customers involve risks that may not be present or are present to a lesser extent with sales to smaller customers. Large customers often demand more configuration and integration services, or customized features and functions that Cvent may not offer. Failure to secure large new customers, deepen its penetration of its large customer base or the loss of large customers would have an adverse effect on Cvent’s annual recurring revenue (“ARR”), business and operating results.
|
• |
Cvent’s net dollar retention rate may decline or fluctuate.
|
• |
Cvent’s business is substantially dependent upon the continued strength of the market for on-demand software solutions.
|
• |
If Cvent loses access to third-party licenses, Cvent’s software product development and production may be delayed or it may incur additional expense to modify Cvent’s products or products in development.
|
• |
If Cvent fails to comply with its obligations under license or technology agreements with third parties, Cvent may be required to pay damages and Cvent could lose license rights that are critical to its business.
|
• |
Cvent has experienced rapid growth and significant organizational change in recent periods and expect continued future growth, both organically and by acquisitions. If Cvent fails to manage its growth effectively, it may be unable to execute its business plan, maintain high levels of service or address competitive challenges adequately.
|
• |
Failure to adequately expand Cvent’s sales force will impede its growth.
|
• |
In the past Cvent has completed acquisitions and may acquire or invest in other companies or technologies in the future, which could divert management’s attention, fail to meet its expectations, result in additional dilution to Cvent’s stockholders, increase expenses, disrupt its operations and harm its operating results.
|
• |
Cvent’s long-term success depends, in part, on its ability to operate offices located outside of the United States, including India.
|
• |
Cvent’s business is susceptible to declines or disruptions in the demand for meetings and events, including those due to economic downturns, natural disasters, geopolitical upheaval and global pandemics.
|
• |
Cvent is dependent in part upon its relationships with its strategic partners to sustain the flow of requests for proposals (“RFPs”), through the Hospitality Cloud.
|
• |
Cvent relies on third-party mobile application platforms such as the Apple App Store and the Google Play Store to distribute its mobile applications. Cvent’s business will suffer if it is unable to maintain a good relationship with such platform providers, if their terms and conditions or pricing change to our detriment, if it violates, or if a platform provider believes that it has violated, the terms and conditions of its platform, or if any of these platforms are unavailable for a prolonged period of time.
|
• |
Cvent has experienced losses in the first six months of 2021, 2020 and in prior years, and Cvent may not achieve profitability in the future.
|
• |
If Cvent does not continue to innovate and provide solutions that are useful to Cvent’s customers and event registrants and attendees, Cvent may not remain competitive, and its revenue and operating results could suffer.
|
• |
Cvent’s sales cycle can be lengthy and unpredictable, which may cause its operating results to vary significantly.
|
• |
Cvent relies on the performance of highly skilled personnel, including senior management and its sales and technology professionals; if Cvent is unable to retain or motivate key personnel or hire, retain and motivate qualified personnel, Cvent’s business would be harmed.
|
• |
Cvent’s ability to introduce new products and features is dependent on adequate research and development resources. If Cvent does not adequately fund its research and development efforts, Cvent may not be able to compete effectively and its business and operating results may be harmed.
|
• |
Seasonality may cause fluctuations in Cvent’s revenue, sales, billings, cash flow, operating expenses and operating results.
|
• |
If Cvent fails to offer high-quality customer support, its business and reputation would suffer.
|
• |
Cvent’s business could be adversely affected if its users are not satisfied with the deployment, training and support services provided by Cvent and its partners.
|
• |
Assuming No Redemptions – this scenario assumes that no public shareholders of Dragoneer exercise redemption rights with respect to their public shares; and
|
• |
Assuming Maximum Redemptions – this scenario assumes that 27,600,000 of Dragoneer’s public shares are redeemed for an aggregate payment of $276.0 million at a redemption price of approximately $10.00 per share based on the investments held in the trust account as of June 30, 2021. The Business Combination Agreement includes as a condition to closing the Business Combination that, at Closing, New Cvent will receive a minimum cash amount of $356.0 million comprising (i) the cash in the trust account
minus
(ii) the amount of the Dragoneer shareholder redemptions,
plus
(iii) the aggregate gross proceeds received by Dragoneer from the PIPE Financing,
plus
(iv) the aggregate amount received by Dragoneer under the Forward Purchase Agreement. The minimum cash amount shall be calculated without reduction for any payments in respect of debt repayments, transaction fees and expenses.
|
Assuming No
Redemptions (Shares) |
%
|
Assuming
Maximum Redemptions (Shares) |
%
|
|||||||||||||
Cvent Stockholders
|
416,351,853 | 77.9 | % | 416,351,853 | 82.1 | % | ||||||||||
Cvent options (1)
|
30,445,543 | 5.7 | % | 30,445,543 | 6.0 | % | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total shares issued in Business Combination
|
|
446,797,396
|
|
|
83.6
|
%
|
|
446,797,396
|
|
|
88.1
|
%
|
||||
Dragoneer’s public stockholders
|
27,600,000 | 5.2 | % | — | 0.0 | % | ||||||||||
Sponsor (2)
|
7,852,000 | 1.5 | % | 7,852,000 | 1.5 | % | ||||||||||
PIPE Investors (3)
|
52,500,000 | 9.8 | % | 52,500,000 | 10.4 | % | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Pro Forma Common Stock
|
|
534,749,396
|
|
|
100.0
|
%
|
|
507,149,396
|
|
|
100.0
|
%
|
||||
|
|
|
|
|
|
|
|
(1) |
Represents shares underlying Cvent options calculated on a net exercise basis, which represents an aggregate 51,764,924 outstanding Cvent options less implied share buybacks of approximately 21,319,381.
|
(2) |
Includes 6,900,000 Class B ordinary shares held by the Initial Shareholders, 752,000 private placement shares held by the Sponsor and 200,000 Class A ordinary shares to be received by the Sponsor from the conversion of the promissory note upon the consummation of the Business Combination.
|
(3) |
Includes 47,500,000 shares of New Cvent Common Stock issued to the PIPE Investors in the PIPE Financing and 5,000,000 shares of Class A ordinary shares to be purchased by Dragoneer Funding II LLC pursuant to the Forward Purchase Agreement and the Business Combination Agreement.
|
Pro Forma Combined
(Assuming No Redemptions) |
Pro Forma Combined
(Assuming Maximum Redemptions) |
|||||||
(in thousands, except share and per share data) | ||||||||
Summary Unaudited Pro Forma Condensed Combined
|
||||||||
Statement of Operations Data Six Months Ended June 30, 2021
|
||||||||
Revenue
|
$ | 240,101 | $ | 240,101 | ||||
Gross profit
|
150,257 | 150,257 | ||||||
Loss from operations
|
(24,079 | ) | (24,079 | ) | ||||
Net loss
|
(30,900 | ) | (32,907 | ) | ||||
Pro forma basic and diluted net loss per share
|
$ | (0.06 | ) | $ | (0.07 | ) | ||
Pro forma basic and diluted weighted average shares outstanding
|
504,303,853 | 476,703,853 | ||||||
Summary Unaudited Pro Forma Condensed Combined
|
||||||||
Statement of Operations Data Year Ended December 31, 2020
|
||||||||
Revenue
|
$ | 498,700 | $ | 498,700 | ||||
Gross profit
|
322,450 | 322,450 | ||||||
Loss from operations
|
(28,310 | ) | (28,310 | ) | ||||
Net loss
|
(69,888 | ) | (72,901 | ) | ||||
Pro forma basic and diluted net loss per share
|
$ | (0.14 | ) | $ | (0.15 | ) | ||
Pro forma basic and diluted weighted average shares outstanding
|
504,303,853 | 476,703,853 | ||||||
Selected Unaudited Pro Forma Condensed Combined
|
||||||||
Balance Sheet Data as of June 30, 2021
|
||||||||
Total assets
|
$ | 2,467,044 | $ | 2,317,025 | ||||
Total liabilities
|
$ | 593,751 | $ | 718,404 | ||||
Total stockholders’ equity
|
$ | 1,873,293 | $ | 1,598,621 |
(a) |
in connection with the Domestication, on the Closing Date prior to the First Effective Time: (i) each issued and outstanding Class A ordinary share and each issued and outstanding Class B ordinary share of Dragoneer will be converted into one share of New Cvent Common Stock; (ii) Dragoneer will change its jurisdiction of incorporation by deregistering as a Cayman Islands exempted company and continuing and domesticating as a corporation incorporated under the laws of the State of Delaware; and (iii) Dragoneer’s name will change to “Cvent Holding Corp.”
|
(b) |
the parties to the Business Combination Agreement will cause two certificates of merger to be executed and filed with the Secretary of State of the State of Delaware, pursuant to which, respectively, (i) Merger Sub I will merge with and into Cvent, with Cvent as the surviving company in the First Merger and (ii) Cvent as the surviving company in the First Merger will merge with and into Merger Sub II, with Merger Sub II as the surviving company in the Second Merger, and, after giving effect to such mergers, Merger Sub II will be a wholly-owned subsidiary of Dragoneer. In accordance with the terms and subject to the conditions of the Business Combination Agreement, at the Second Effective Time, each share and equity award of Cvent outstanding as of immediately prior to the Second Effective Time will be exchanged for shares of New Cvent Common Stock or comparable equity awards that are settled or are exercisable for shares of New Cvent Common Stock, as applicable, based on an implied Cvent equity value of $4,467,973,959.
|
• |
the issuance and sale of 47,500,000 shares of New Cvent Common Stock to the PIPE Investors at a purchase price of $10.00 per share for aggregate proceeds of $475.0 million pursuant to the Subscription Agreements;
|
• |
the issuance and sale of 5,000,000 Class A ordinary shares to Dragoneer Funding II LLC at a purchase price of $10.00 per share for aggregate proceeds of $50.0 million pursuant to the Forward Purchase Agreement and the Business Combination Agreement;
|
• |
the conversion of the $2.0 million promissory note made from the Sponsor into 200,000 shares of Class A ordinary shares at a price of $10.00 per share upon the consummation of the Business Combination; and
|
• |
the repayment of $583.0 million of existing Cvent debt in the no redemptions scenario and $457.0 million of existing Cvent debt in the maximum redemption scenario.
|
• |
Cvent’s existing stockholders will have a majority of the voting power in New Cvent, irrespective of whether Dragoneer’s public shareholders exercise their right to redeem their public shares;
|
• |
Cvent will have the ability to nominate a majority of the initial members of the New Cvent Board;
|
• |
Cvent’s senior management will be the senior management of New Cvent;
|
• |
Cvent’s operations prior to the Business Combination will comprise the ongoing operations of New Cvent;
|
• |
Cvent is the larger entity based on historical operating activity and has the larger employee base; and
|
• |
The post-combination company will assume a Cvent branded name: “Cvent Holding Corp.”
|
• |
Assuming No Redemptions – this scenario assumes that no public shareholders of Dragoneer exercise redemption rights with respect to their public shares; and
|
• |
Assuming Maximum Redemptions – this scenario assumes that 27,600,000 of Dragoneer’s public shares are redeemed for an aggregate payment of $276.0 million at a redemption price of approximately $10.00 per share based on the investments held in the trust account as of June 30, 2021. The Business Combination Agreement includes as a condition to closing the Business Combination that, at Closing, New Cvent will receive a minimum cash amount of $356.0 million comprising (i) the cash in the trust account
minus
(ii) the amount of the Dragoneer shareholder redemptions,
plus
(iii) the aggregate gross proceeds received by Dragoneer from the PIPE Financing,
plus
(iv) the aggregate amount received by Dragoneer under the Forward Purchase Agreement. The minimum cash amount shall be calculated without reduction for any payments in respect of debt repayments, transaction fees and expenses.
|
Assuming No
Redemptions (Shares) |
%
|
Assuming
Maximum Redemptions (Shares) |
%
|
|||||||||||||
Cvent Stockholders
|
416,351,853 | 77.9 | % | 416,351,853 | 82.1 | % | ||||||||||
Cvent options (1)
|
30,445,543 | 5.7 | % | 30,445,543 | 6.0 | % | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total shares issued in Business Combination
|
|
446,797,396
|
|
|
83.6
|
%
|
|
446,797,396
|
|
|
88.1
|
%
|
||||
Dragoneer’s public stockholders
|
27,600,000 | 5.2 | % | — | 0.0 | % | ||||||||||
Sponsor (2)
|
7,852,000 | 1.5 | % | 7,852,000 | 1.5 | % | ||||||||||
PIPE Investors (3)
|
52,500,000 | 9.8 | % | 52,500,000 | 10.4 | % | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Pro Forma Common Stock
|
|
534,749,396
|
|
|
100.0
|
%
|
|
507,149,396
|
|
|
100.0
|
%
|
||||
|
|
|
|
|
|
|
|
(1) |
Represents shares underlying Cvent options calculated on a net exercise basis, which represents an aggregate 51,764,924 outstanding Cvent options less implied share buybacks of approximately 21,319,381.
|
(2) |
Includes 6,900,000 Class B ordinary shares held by the Initial Shareholders, 752,000 private placement shares held by the Sponsor and 200,000 Class A ordinary shares to be received by the Sponsor from the conversion of the promissory note upon the consummation of the Business Combination.
|
(3) |
Includes 47,500,000 shares of New Cvent Common Stock issued to the PIPE Investors in the PIPE Financing and 5,000,000 shares of Class A ordinary shares to be purchased by Dragoneer Funding II LLC pursuant to the Forward Purchase Agreement and the Business Combination Agreement.
|
As of June 30, 2021
|
Transaction
Accounting
Adjustments
(Assuming No
Redemptions)
(Note 3)
|
As of
June 30, 2021
|
Additional
Transaction
Accounting
Adjustments
(Assuming
Maximum
Redemptions)
(Note 3)
|
As of
June 30, 2021
|
||||||||||||||||||||||||||||
Cvent
(Historical) |
Dragoneer
(Historical) |
Pro Forma
Combined (Assuming No Redemptions) |
Pro Forma
Combined (Assuming Maximum Redemptions) |
|||||||||||||||||||||||||||||
Assets
|
||||||||||||||||||||||||||||||||
Cash and cash equivalents
|
$ | 95,043 | $ | 1,967 | $ | 276,009 | (a | ) | $ | 250,019 | $ | (276,009 | ) | (l | ) | $ | 100,000 | |||||||||||||||
(9,660 | ) | (b | ) | 125,990 | (k | ) | ||||||||||||||||||||||||||
(55,340 | ) | (c | ) | |||||||||||||||||||||||||||||
475,000 | (d | ) | ||||||||||||||||||||||||||||||
50,000 | (e | ) | ||||||||||||||||||||||||||||||
(583,000 | ) | (k | ) | |||||||||||||||||||||||||||||
Restricted cash
|
105 | — | — | 105 | — | 105 | ||||||||||||||||||||||||||
Short-term investments
|
12,074 | — | — | 12,074 | — | 12,074 | ||||||||||||||||||||||||||
Accounts receivable
|
106,014 | — | — | 106,014 | — | 106,014 | ||||||||||||||||||||||||||
Capitalized commissions, net
|
20,982 | — | — | 20,982 | — | 20,982 | ||||||||||||||||||||||||||
Prepaid expenses and other current assets
|
15,988 | 901 | — | 16,889 | — | 16,889 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total current assets
|
|
250,206
|
|
|
2,868
|
|
|
153,009
|
|
|
406,083
|
|
|
(150,019
|
)
|
|
256,064
|
|
||||||||||||||
Investment held in Trust Account
|
— | 276,009 | (276,009 | ) | (a | ) | — | — | — | |||||||||||||||||||||||
Property and equipment, net
|
17,852 | — | — | 17,852 | — | 17,852 | ||||||||||||||||||||||||||
Capitalized software development costs, net
|
118,535 | — | — | 118,535 | — | 118,535 | ||||||||||||||||||||||||||
Intangible assets, net
|
247,118 | — | — | 247,118 | — | 247,118 | ||||||||||||||||||||||||||
Goodwill
|
1,617,944 | — | — | 1,617,944 | — | 1,617,944 | ||||||||||||||||||||||||||
Operating lease
right-of-use
|
34,088 | — | — | 34,088 | — | 34,088 | ||||||||||||||||||||||||||
Capitalized commissions, net,
non-current
|
19,427 | — | — | 19,427 | — | 19,427 | ||||||||||||||||||||||||||
Deferred tax assets,
non-current
|
1,868 | — | — | 1,868 | — | 1,868 | ||||||||||||||||||||||||||
Other assets,
non-current,
net
|
4,129 | — | — | 4,129 | — | 4,129 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total assets
|
|
2,311,167
|
|
|
278,877
|
|
|
(123,000
|
)
|
|
2,467,044
|
|
|
(150,019
|
)
|
|
2,317,025
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Liabilities
|
||||||||||||||||||||||||||||||||
Current portion of long-term debt
|
4,537 | — | — | 4,537 | — | 4,537 | ||||||||||||||||||||||||||
Accounts payable
|
6,449 | — | — | 6,449 | — | 6,449 | ||||||||||||||||||||||||||
Accrued expenses and other current liabilities
|
64,619 | 1,394 | (1,082 | ) | (c | ) | 64,931 | — | 64,931 | |||||||||||||||||||||||
Convertible note
|
— | 2,000 | (2,000 | ) | (g | ) | — | — | — | |||||||||||||||||||||||
Fees payable to customers
|
26,739 | — | — | 26,739 | — | 26,739 | ||||||||||||||||||||||||||
Operating lease liabilities, current
|
15,492 | — | — | 15,492 | — | 15,492 | ||||||||||||||||||||||||||
Deferred revenue
|
241,649 | — | — | 241,649 | — | 241,649 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total current liabilities
|
|
359,485
|
|
|
3,394
|
|
|
(3,082
|
)
|
|
359,797
|
|
|
—
|
|
|
359,797
|
|
||||||||||||||
Deferred tax liabilities,
non-current
|
17,627 | — | — | 17,627 | — | 17,627 | ||||||||||||||||||||||||||
Deferred underwriting fee payable
|
— | 9,660 | (9,660 | ) | (b | ) | — | — | — | |||||||||||||||||||||||
Long-term debt, net
|
751,680 | — | (576,811 | ) | (k | ) | 174,869 | 124,653 | (k | ) | 299,522 | |||||||||||||||||||||
Operating lease liabilities,
non-current
|
34,233 | — | — | 34,233 | — | 34,233 | ||||||||||||||||||||||||||
Other liabilities,
non-current
|
7,225 | — | — | 7,225 | — | 7,225 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total liabilities
|
|
1,170,250
|
|
|
13,054
|
|
|
(589,553
|
)
|
|
593,751
|
|
|
124,653
|
|
|
718,404
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Commitments and contingencies
|
||||||||||||||||||||||||||||||||
Class A ordinary shares subject to possible redemption
|
— | 276,000 | (276,000 | ) | (f | ) | — | — | — | |||||||||||||||||||||||
Stockholders’ equity
|
||||||||||||||||||||||||||||||||
Preference shares
|
— | — | — | — | — | — |
As of June 30, 2021
|
Transaction
Accounting
Adjustments
(Assuming No
Redemptions)
(Note 3)
|
As of
June 30, 2021
|
Additional
Transaction
Accounting
Adjustments
(Assuming
Maximum
Redemptions)
(Note 3)
|
As of
June 30, 2021
|
||||||||||||||||||||||||||||
Cvent
(Historical) |
Dragoneer
(Historical) |
Pro Forma
Combined (Assuming No Redemptions) |
Pro Forma
Combined (Assuming Maximum Redemptions) |
|||||||||||||||||||||||||||||
Dragoneer Ordinary shares
|
||||||||||||||||||||||||||||||||
Class A
|
— | — | 1 | (e | ) | — | — | — | ||||||||||||||||||||||||
3 | (f | ) | ||||||||||||||||||||||||||||||
— | (g | ) | ||||||||||||||||||||||||||||||
(4 | ) | (h | ) | |||||||||||||||||||||||||||||
Class B
|
— | 1 | (1 | ) | (h | ) | — | — | — | |||||||||||||||||||||||
Cvent Common stock
|
1 | (1 | ) | (i | ) | — | — | — | ||||||||||||||||||||||||
New Cvent Common stock
|
— | — | 5 | (d | ) | 52 | (3 | ) | (l | ) | 49 | |||||||||||||||||||||
5 | (h | ) | ||||||||||||||||||||||||||||||
42 | (i | ) | ||||||||||||||||||||||||||||||
Additional
paid-in
capital
|
1,945,267 | — | (15,000 | ) | (c | ) | 2,683,781 | (276,006 | ) | (l | ) | 2,407,775 | ||||||||||||||||||||
(30,000 | ) | (c | ) | |||||||||||||||||||||||||||||
474,995 | (d | ) | ||||||||||||||||||||||||||||||
49,999 | (e | ) | ||||||||||||||||||||||||||||||
275,997 | (f | ) | ||||||||||||||||||||||||||||||
2,000 | (g | ) | ||||||||||||||||||||||||||||||
(41 | ) | (i | ) | |||||||||||||||||||||||||||||
(19,436 | ) | (j | ) | |||||||||||||||||||||||||||||
Accumulated other comprehensive loss
|
(414 | ) | — | — | (414 | ) | — | (414 | ) | |||||||||||||||||||||||
Accumulated deficit
|
(803,937 | ) | (10,178 | ) | (9,258 | ) | (c | ) | (810,126 | ) | 1,337 | (k | ) | (808,789 | ) | |||||||||||||||||
19,436 | (j | ) | ||||||||||||||||||||||||||||||
(6,189 | ) | (k | ) | |||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total stockholders’ equity
|
|
1,140,917
|
|
|
(10,177
|
)
|
|
742,553
|
|
|
1,873,293
|
|
|
(274,672
|
)
|
|
1,598,621
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total liabilities and stockholders’ equity
|
$
|
2,311,167
|
|
$
|
278,877
|
|
$
|
(123,000
|
)
|
$
|
2,467,044
|
|
$
|
(150,019
|
)
|
$
|
2,317,025
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended
June 30, 2021
|
Transaction
Accounting
Adjustments
(Assuming No
Redemptions)
(Note 3) |
Six Months
Ended June 30, 2021 |
Additional
Transaction Accounting
Adjustments
(Assuming
Maximum
Redemptions)
(Note 3) |
Six Months
Ended June 30, 2021 |
||||||||||||||||||||||||||||
Cvent
(Historical) |
Dragoneer
(Historical) |
Pro Forma
Combined
(Assuming No
Redemptions) |
Pro Forma
Combined
(Assuming
Maximum
Redemptions) |
|||||||||||||||||||||||||||||
Revenue
|
$ | 240,101 | $ | — | $ | — | $ | 240,101 | $ | — | $ | 240,101 | ||||||||||||||||||||
Cost of revenue
|
89,844 | — | — | 89,844 | — | 89,844 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Gross profit
|
150,257 | — | — | 150,257 | — | 150,257 | ||||||||||||||||||||||||||
Operating expenses:
|
||||||||||||||||||||||||||||||||
Sales and marketing
|
61,907 | — | — | 61,907 | — | 61,907 | ||||||||||||||||||||||||||
Research and development
|
46,331 | — | — | 46,331 | — | 46,331 | ||||||||||||||||||||||||||
General and administrative
|
38,354 | 1,780 | — | 40,134 | — | 40,134 | ||||||||||||||||||||||||||
Intangible asset amortization, excluding cost of revenue
|
25,964 | — | — | 25,964 | — | 25,964 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total operating expenses
|
|
172,556
|
|
|
1,780
|
|
— |
|
174,336
|
|
— |
|
174,336
|
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Loss from operations
|
|
(22,299
|
)
|
|
(1,780
|
)
|
|
—
|
|
|
(24,079
|
)
|
|
—
|
|
|
(24,079
|
)
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Other income (expense):
|
||||||||||||||||||||||||||||||||
Interest expense
|
(15,171 | ) | — | 12,381 | (bb | ) | (2,790 | ) | (2,676 | ) | (bb | ) | (5,466 | ) | ||||||||||||||||||
Interest earned on marketable securities held in Trust Account
|
— | 9 | (9 | ) | (aa | ) | — | — | — | |||||||||||||||||||||||
Amortization of deferred financing costs and debt discount
|
(1,884 | ) | — | — | (1,884 | ) | — | (1,884 | ) | |||||||||||||||||||||||
Other income, net
|
4,271 | — | — | 4,271 | — | 4,271 | ||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Total other income (expense)
|
(12,784 | ) | 9 | 12,372 | (403 | ) | (2,676 | ) | (3,079 | ) | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Loss before income taxes
|
(35,083 | ) | (1,771 | ) | 12,372 | (24,482 | ) | (2,676 | ) | (27,158 | ) | |||||||||||||||||||||
Provision for income taxes
|
3,325 | — | 3,093 | (dd | ) | 6,418 | (669 | ) | (dd | ) | 5,749 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Net loss
|
$
|
(38,408
|
)
|
$
|
(1,771
|
)
|
$
|
9,279
|
|
$
|
(30,900
|
)
|
$
|
(2,007
|
)
|
$
|
(32,907
|
)
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Basic and diluted weighted average shares outstanding
|
917,580 | 504,303,853 | 476,703,853 | |||||||||||||||||||||||||||||
Basic and diluted net loss per share
|
$ | (41.86 | ) | $ | (0.06 | ) | $ | (0.07 | ) |
Year
|
||||||||||||||||||||||||
For the period
|
Year
|
Additional
Transaction
Accounting
Adjustments
|
Ended
|
|||||||||||||||||||||
from
|
Ended
|
December 31,
|
||||||||||||||||||||||
For the
|
September 25, 2020
|
Transaction
Accounting
Adjustments
(Assuming No
Redemptions)
|
December 31,
|
2020
|
||||||||||||||||||||
Year Ended
|
(inception)
|
2020
|
Pro Forma
|
|||||||||||||||||||||
December 31,
|
through
|
Pro Forma
|
(Assuming
|
Combined
|
||||||||||||||||||||
2020
|
December 31, 2020
|
Combined
|
Maximum
|
(Assuming
|
||||||||||||||||||||
Cvent
|
Dragoneer
|
(Assuming No
|
Redemptions)
|
Maximum
|
||||||||||||||||||||
(Historical)
|
(Historical)
|
(Note 3)
|
Redemptions)
|
(Note 3)
|
Redemptions)
|
|||||||||||||||||||
Revenue
|
$ | 498,700 | $ | — | $ | — | $ | 498,700 | $ | — | $ | 498,700 | ||||||||||||
Cost of revenue
|
176,250 | — | — | 176,250 | — | 176,250 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Gross profit
|
322,450 | — | — | 322,450 | — | 322,450 | ||||||||||||||||||
Operating expenses:
|
||||||||||||||||||||||||
Sales and marketing
|
128,388 | — | — | 128,388 | — | 128,388 | ||||||||||||||||||
Research and development
|
87,866 | — | — | 87,866 | — | 87,866 | ||||||||||||||||||
General and administrative
|
80,564 | 98 | — | 80,662 | — | 80,662 | ||||||||||||||||||
Intangible asset amortization, excluding cost of revenue
|
53,844 | — | — | 53,844 | — | 53,844 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total operating
expenses |
350,662
|
98
|
—
|
350,760
|
—
|
350,760
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Loss from operations
|
(28,212
|
)
|
(98
|
)
|
—
|
(28,310
|
)
|
—
|
(28,310
|
)
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Other income (expense):
|
||||||||||||||||||||||||
Interest expense
|
(35,557 | ) | — | 24,780 | (bb) | (10,777 | ) | (5,355 | ) (bb) | (16,132 | ) | |||||||||||||
Amortization of deferred financing costs and debt discount
|
|
(3,798
|
)
|
|
—
|
|
|
—
|
|
|
(3,798
|
)
|
|
—
|
|
|
(3,798
|
)
|
||||||
Gain/(loss) on divestitures, net
|
|
(9,634
|
)
|
|
—
|
|
|
—
|
|
|
(9,634
|
)
|
|
—
|
|
|
(9,634
|
)
|
||||||
Loss on repayment of debt
|
— | — | (6,189 | ) (cc) | (6,189 | ) | 1,337 | (cc) | (4,852 | ) | ||||||||||||||
Other income, net
|
|
1,333
|
|
|
—
|
|
|
—
|
|
|
1,333
|
|
|
—
|
|
|
1,333
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total other income (expense)
|
|
(47,656
|
)
|
|
—
|
|
|
18,591
|
|
|
(29,065
|
)
|
|
(4,018
|
)
|
|
(33,083
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Loss before income taxes
|
|
(75,868
|
)
|
|
(98
|
)
|
|
18,591
|
|
|
(57,375
|
)
|
|
(4,018
|
)
|
|
(61,393
|
)
|
||||||
Provision for income taxes
|
|
7,865
|
|
|
4,648
|
(dd)
|
|
12,513
|
|
|
(1,005
|
) (dd)
|
|
11,508
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net loss
|
$
|
(83,733
|
)
|
$
|
(98
|
)
|
$
|
13,943
|
|
$
|
(69,888
|
)
|
$
|
(3,013
|
)
|
$
|
(72,901
|
)
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Basic and diluted weighted average shares outstanding
|
917,109 | 504,303,853 | 476,703,853 | |||||||||||||||||||||
Basic and diluted net loss per share
|
$ | (91.30 | ) | $ | (0.14 | ) | $ | (0.15 | ) |
1.
|
Basis of Presentation
|
• |
Cvent’s unaudited condensed consolidated balance sheet as of June 30, 2021 and the related notes included elsewhere in this proxy statement/prospectus/consent solicitation; and
|
• |
Dragoneer’s unaudited condensed balance sheet as of June 30, 2021 and the related notes included elsewhere in this proxy statement/prospectus/consent solicitation.
|
• |
Cvent’s unaudited condensed consolidated statement of operations and comprehensive loss for the six months ended June 30, 2021 and the related notes included elsewhere in this proxy statement/prospectus/consent solicitation; and
|
• |
Dragoneer’s unaudited condensed statement of operations for the six months ended June 30, 2021 and the related notes included elsewhere in this proxy statement/prospectus/consent solicitation.
|
• |
Cvent’s audited consolidated statement of operations and comprehensive loss for the year ended December 31, 2020 and the related notes included elsewhere in this proxy statement/prospectus/consent solicitation; and
|
• |
Dragoneer’s audited statement of operations for the period from September 25, 2020 (inception) through December 31, 2020 and the related notes included elsewhere in this proxy statement/prospectus/consent solicitation.
|
2.
|
Accounting Policies
|
3.
|
Adjustments to Unaudited Pro Forma Condensed Combined Financial Information
|
(a) |
Reflects the liquidation and reclassification of investment held in the trust account that becomes available following the Business Combination, assuming no redemption.
|
(b) |
Reflects the settlement of $9.7 million in deferred underwriting fee payable.
|
(c) |
Represents preliminary estimated transaction costs expected to be incurred by Cvent and Dragoneer of approximately $30.00 million and $25.34 million, respectively, for legal, financial advisory and other professional fees.
|
• |
Approximately $1.08 million were accrued by Dragoneer in Accrued expenses and other current liabilities and recognized as expense as of June 30, 2021;
|
• |
Approximately $15.00 million represents equity issuance costs related to the PIPE Financing and was capitalized and offset against the proceeds from the PIPE Financing and reflected as a decrease in additional paid-in capital; and
|
• |
Approximately $9.26 million were reflected as an adjustment to accumulated deficit, which represents the total estimated Dragoneer transaction costs less: (1) $15.00 million capitalized and offset against the proceeds from the PIPE Financing; and (2) $1.08 million previously recognized as expense as of June 30, 2021. These costs reflected as an adjustment to accumulated deficit have been excluded from the unaudited pro forma condensed combined statement of operations.
|
(d) |
Reflects proceeds of $475.0 million from the issuance and sale of 47,500,000 shares of New Cvent Common Stock, par value of $0.0001 per share, at $10.00 per share in the PIPE Financing pursuant to the Subscription Agreements.
|
(e) |
Reflects proceeds of $50.0 million from the issuance and sale of 5,000,000 Class A ordinary shares, par value of $0.0001 per share, to Dragoneer Funding II LLC at $10.00 per share pursuant to the Forward Purchase Agreement and the Business Combination Agreement.
|
(f) |
Reflects the reclassification of $276.0 million of Dragoneer Class A ordinary shares, par value of $0.0001 per share, subject to possible redemption to permanent equity.
|
(g) |
Represents the conversion of the promissory note made from the Sponsor into 200,000 shares of Class A ordinary shares, par value of $0.0001 per share, at a price of $10.00 per share upon the consummation of the Business Combination.
|
(h) |
Reflects the conversion of Class A ordinary shares and Class B ordinary shares, on a one-for one basis, into shares of New Cvent Common Stock in the Domestication.
|
(i) |
Reflects the recapitalization of Cvent equity of 917,761 common shares into 416,351,853 shares of New Cvent Common Stock, par value of $0.0001 per share.
|
(j) |
Reflects the elimination of Dragoneer’s historical accumulated deficit after recording the transaction costs to be incurred by Dragoneer as described in Note 3(c) above.
|
(k) |
Represents the repayment of approximately $583.0 million of Cvent’s existing debt in connection with the Business Combination in the no redemption scenario and approximately $457.0 million of Cvent’s existing debt in connection with the Business Combination in the maximum redemption scenario. The difference between the cash proceeds and the carrying value of Cvent’s debt is recorded as a loss on repayment of debt and recorded as a decrease to Accumulated deficit. The loss on repayment of debt recorded through Accumulated deficit is included in the unaudited pro forma condensed combined statement of operations for the year ended December 31, 2020 as discussed in Note 3(cc) below.
|
(l) |
Represents the redemption of the maximum number of shares of 27,600,000 shares of Dragoneer’s Class A ordinary shares for $276.0 million allocated to common stock and additional paid-in capital using par value of $0.0001 per share and at a redemption price of $10.00 per share (based on the investment held in the trust account as of June 30, 2021).
|
(aa) |
Represents pro forma adjustment to eliminate interest earned on marketable securities held in the trust account.
|
(bb) |
Reflects the elimination of interest expense related to a portion of Cvent’s existing debt, which will be repaid as described in Note 3(k) above.
|
(cc) |
Represents the pro forma adjustment to recognize the loss on repayment of debt related to the repayment of Cvent’s existing debt as discussed in Note 3(k) above. The loss is reflected as if incurred on January 1, 2020, the date the Business Combination occurred for the purposes of the unaudited pro forma condensed combined statements of operations. These costs will not affect New Cvent’s income statement beyond 12 months after the acquisition date.
|
(dd) |
Reflects the adjustment to income tax expense as a result of the tax impact on the pro forma adjustments at the estimated combined statutory tax rate of 25.0%.
|
4.
|
Loss per Share
|
Six Months Ended
June 30, 2021
|
Year Ended
December 31, 2020
|
|||||||||||||||
Assuming No
Redemptions |
Assuming
Maximum Redemptions |
Assuming No
Redemptions |
Assuming
Maximum Redemptions |
|||||||||||||
Pro forma net loss (in thousands)
|
$ | (30,900 | ) | $ | (32,907 | ) | $ | (69,888 | ) | $ | (72,901 | ) | ||||
Weighted average shares outstanding, basic and diluted
|
504,303,853 | 476,703,853 | 504,303,853 | 476,703,853 | ||||||||||||
Net loss per share, basic and diluted (1)
|
$ | (0.06 | ) | $ | (0.07 | ) | $ | (0.14 | ) | $ | (0.15 | ) | ||||
Weighted average shares calculation, basic and diluted
|
||||||||||||||||
Dragoneer’s public stockholders
|
27,600,000 | — | 27,600,000 | — | ||||||||||||
Sponsor (2)
|
7,852,000 | 7,852,000 | 7,852,000 | 7,852,000 | ||||||||||||
PIPE Investors (3)
|
52,500,000 | 52,500,000 | 52,500,000 | 52,500,000 | ||||||||||||
Cvent Stockholders
|
416,351,853 | 416,351,853 | 416,351,853 | 416,351,853 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
504,303,853 | 476,703,853 | 504,303,853 | 476,703,853 | |||||||||||||
|
|
|
|
|
|
|
|
(1) |
The pro forma basic and diluted shares exclude 51,764,924 Cvent options because including them would be antidilutive.
|
(2) |
Includes 6,900,000 Class B ordinary shares held by the Initial Shareholders, 752,000 private placement shares held by the Sponsor and 200,000 Class A ordinary shares to be received by the Sponsor upon conversion of the promissory note upon the consummation of the Business Combination.
|
(3) |
Includes 47,500,000 shares of New Cvent Common Stock issued to the PIPE Investors in the PIPE Financing and 5,000,000 shares of Class A ordinary shares to be purchased by Dragoneer Funding II LLC pursuant to the Forward Purchase Agreement and the Business Combination Agreement.
|
Dragoneer
Shares |
Cvent
Common Stock |
|||||||
July 22, 2021
|
$10.03 | N/A | ||||||
[•], 2021
|
$[•] | N/A |
• |
undetected errors or unauthorized use of another person’s code in the third party’s software;
|
• |
disagreement over the scope of the license and other key terms, such as royalties payable;
|
• |
infringement, misappropriation or other actions brought by third-party licensees;
|
• |
that third parties will create solutions that directly compete with our products; and
|
• |
termination or expiration of the license.
|
• |
unanticipated costs or liabilities associated with the acquisition, including tax liabilities;
|
• |
incurrence of acquisition-related costs, which would be recognized as a current period expense;
|
• |
inability to generate sufficient revenue or profit to offset acquisition or investment costs, or failure to generate the revenue we had anticipated from the acquired business;
|
• |
the inability to maintain and renew relationships with customers and partners of the acquired business;
|
• |
the difficulty of incorporating acquired technology and rights into our platform and of maintaining quality and security standards consistent with our brand;
|
• |
difficulties and additional expenses associated with supporting legacy products;
|
• |
delays in customer purchases due to uncertainty related to any acquisition;
|
• |
the need to integrate or implement additional controls, procedures and policies;
|
• |
challenges caused by distance, language and cultural differences;
|
• |
harm to our existing business relationships with business partners and customers as a result of the acquisition;
|
• |
the potential loss of key employees;
|
• |
use of resources that are needed in other parts of our business and diversion of management and employee resources;
|
• |
the inability to recognize acquired revenue in accordance with our revenue recognition policies under
|
• |
GAAP and the loss of acquired deferred revenue;
|
• |
the use of substantial portions of our available cash or the incurrence of debt to consummate the acquisition;
|
• |
delays or errors in integrating back-end systems and departments, including but not limited to accounting and CRM systems; and
|
• |
from time to time after acquiring a business, product, or technology, we may determine that it is necessary or appropriate to dispose of some or all of the acquired assets or business, and we may not be able to execute such disposition at a favorable time, or upon favorable terms.
|
• |
increased costs and unexpected errors in the localization of our solutions, including translation into foreign languages and adaptation for local practices and regulatory requirements;
|
• |
challenges posed by different pricing environments and different forms of competition;
|
• |
lack of familiarity and burdens of complying with foreign laws, legal standards, regulatory requirements (including privacy and data security requirements) and tariffs; the costs of compliance with anti-corruption and anti-bribery laws; and the risks and costs of noncompliance with such laws;
|
• |
changes in regulatory requirements, taxes, trade laws, tariffs, export quotas, custom duties or other trade restrictions;
|
• |
difficulties in managing technology partners and differing technology standards;
|
• |
difficulties in collecting accounts receivable;
|
• |
difficulties in managing and staffing international operations;
|
• |
differing labor laws and varying expectations as to employee standards;
|
• |
difficulties in maintaining our company culture with a dispersed and distance workforce;
|
• |
fluctuations in exchange rates that may increase the volatility of our foreign-based revenue and costs;
|
• |
potentially adverse tax consequences, including those arising from the complexities of foreign value added tax (or other tax, including transfer pricing) systems, and restrictions on the repatriation of earnings;
|
• |
limitations on our ability to reinvest earnings from operations in one country to fund the capital needs of our operations in other countries;
|
• |
uncertain political and economic climates;
|
• |
reduced or varied protection for intellectual property rights in some countries;
|
• |
that we may decide that it is necessary or appropriate to establish one or more data centers outside of the United States, which could be costly; and
|
• |
inability to deliver compelling marketing messages that resonate with a local audience.
|
• |
Our ability to increase or maintain user engagement;
|
• |
Our ability to drive planners to our sourcing networks;
|
• |
Our ability to increase or maintain the quantity and quality of ads shown to consumers;
|
• |
The effectiveness of our advertising and the extent to which it generates sales leads, customers, bookings or financial results on a cost-effective basis;
|
• |
The competitiveness of our products, traffic quality, perception of our platform, and availability and accuracy of analytics and measurement solutions to demonstrate our value; and
|
• |
Adverse government actions or legal developments relating to advertising, including limitations on our ability to deliver targeted advertising.
|
• |
adversely affect our relationships with our current or future customers;
|
• |
cause delays or stoppages in providing our software solutions;
|
• |
divert management’s attention and resources;
|
• |
require technology changes or work-arounds to our platform that would cause us to incur substantial cost;
|
• |
subject us to significant liabilities or damages;
|
• |
necessitate incurring significant legal, settlement, royalty or licensing fees;
|
• |
require us to satisfy indemnification obligations; and
|
• |
require us to cease some or all of our activities or impose other unfavorable terms.
|
• |
limiting funds otherwise available for financing our capital expenditures by requiring us to dedicate a portion of our cash flows from operations to the repayment of debt and the interest on this debt;
|
• |
limiting our ability to incur additional indebtedness;
|
• |
limiting our ability to capitalize on significant business opportunities;
|
• |
making us more vulnerable to rising interest rates; and
|
• |
making us more vulnerable in the event of a downturn in our business.
|
• |
incur additional indebtedness;
|
• |
pay dividends on or make distributions in respect of capital stock or repurchase or redeem capital stock;
|
• |
prepay, redeem or repurchase certain indebtedness;
|
• |
make loans and investments;
|
• |
sell or otherwise dispose of assets, including capital stock of restricted subsidiaries;
|
• |
incur liens;
|
• |
enter into transactions with affiliates;
|
• |
enter into agreements restricting the ability of our subsidiaries to pay dividends; and
|
• |
consolidate, merge or sell all or substantially all of our assets.
|
• |
limited in how we conduct our business;
|
• |
unable to raise additional debt or equity financing to operate during general economic or business downturns; or
|
• |
unable to compete effectively or to take advantage of new business opportunities.
|
• |
develop and enhance our products;
|
• |
continue to expand our product development, sales and marketing organizations;
|
• |
hire, train and retain employees;
|
• |
respond to competitive pressures or unanticipated working capital requirements; or
|
• |
pursue acquisition opportunities.
|
• |
the fact that our Initial Shareholders have agreed not to redeem any Class A ordinary shares held by them in connection with a shareholder vote to approve a proposed initial business combination;
|
• |
the fact that the Sponsor paid an aggregate of $25,000 for the 6,900,000 Class B ordinary shares currently owned by the Initial Shareholders and such securities will have a significantly higher value at the time of the Business Combination;
|
• |
the fact that Sponsor paid $7,520,000 for its private placement shares which would be worthless if a business combination is not consummated by February 19, 2023 (unless such date is extended in accordance with the Existing Governing Documents);
|
• |
the fact that Sponsor, the other Initial Shareholders and Dragoneer’s other current officers and directors have agreed to waive their rights to liquidating distributions from the trust account with respect to any ordinary shares (other than public shares) held by them if Dragoneer fails to complete an initial business combination by February 19, 2023;
|
• |
the fact that the Amended and Restated Registration Rights Agreement will be entered into by the Initial Shareholders;
|
• |
the fact that the Forward Purchaser agreed to purchase the Forward Purchase Shares immediately prior to the First Effective Time, but following the Domestication;
|
• |
the fact that, at the option of the Sponsor, any amounts outstanding under the loan made by the Sponsor to Dragoneer in an aggregate amount of up to $2,000,000 may be converted into Class A ordinary shares in connection with the consummation of the Business Combination;
|
• |
the continued indemnification of Dragoneer’s directors and officers and the continuation of Dragoneer’s directors’ and officers’ liability insurance after the Business Combination (i.e., a “tail policy”);
|
• |
the fact that the Sponsor and Dragoneer’s officers and directors will lose their entire investment in Dragoneer and will not be reimbursed for any out-of-pocket expenses if an initial business combination is not consummated by February 19, 2023;
|
• |
the fact that if the trust account is liquidated, including in the event Dragoneer is unable to complete an initial business combination by February 19, 2023, the Sponsor has agreed to indemnify Dragoneer to ensure that the proceeds in the trust account are not reduced below $10.00 per public share, or such lesser per public share amount as is in the trust account on the liquidation date, by the claims of prospective target businesses with which Dragoneer has entered into an acquisition agreement or claims of any third party for services rendered or products sold to Dragoneer, but only if such a vendor or target business has not executed a waiver of any and all rights to seek access to the trust account;
|
• |
the fact that Dragoneer may be entitled to distribute or pay over funds held by Dragoneer outside the Trust Account to the Sponsor or any of its affiliates prior to the Closing;
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• |
the fact that the Sponsor sponsors multiple SPACs and is affiliated with a number of other investment vehicles and has the sole discretion to allocation this transaction to Dragoneer taking into account whatever factors it deems appropriate; and
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• |
the fact that, based on the difference in the purchase price of approximately $0.008 per share that the Sponsor paid for the Founder Shares (as defined below), as compared to the purchase price of $10.00 per share sold in Dragoneer’s initial public offering, the Sponsor may earn a positive rate of return on its investment even if the share price of New Cvent Common Stock falls significantly below the per share value implied in the Business Combination of $10.00 per share and the public stockholders of Dragoneer experience a negative rate of return.
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• |
the requirement that a majority of its board of directors consist of independent directors;
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• |
the requirement that the board have a nominating and governance committee composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and
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• |
the requirement that the board have a compensation committee composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities.
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• |
restrictions on the nature of our investments; and
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• |
restrictions on the issuance of securities, each of which may make it difficult for us to complete the Business Combination.
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• |
registration as an investment company with the SEC;
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• |
adoption of a specific form of corporate structure; and
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• |
reporting, record keeping, voting, proxy and disclosure requirements and other rules and regulations that we are currently not subject to.
|
• |
variations in its operating performance and the performance of its competitors in general;
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• |
material and adverse impact of the COVID-19 pandemic on our business, the markets and the broader global economy;
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• |
actual or anticipated fluctuations in New Cvent’s quarterly or annual operating results;
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• |
publication of research reports by securities analysts about New Cvent or its competitors or its industry;
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• |
the public’s reaction to New Cvent’s press releases, its other public announcements and its filings with the SEC;
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• |
New Cvent’s failure or the failure of its competitors to meet analysts’ projections or guidance that New Cvent or its competitors may give to the market;
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• |
additions and departures of key personnel;
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• |
changes in laws and regulations affecting its business;
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• |
commencement of, or involvement in, litigation involving New Cvent;
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• |
changes in New Cvent’s capital structure, such as future issuances of securities or the incurrence of additional debt;
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• |
the volume of shares of New Cvent Common Stock available for public sale; and
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• |
general economic and political conditions such as recessions, interest rates, fuel prices, foreign currency fluctuations, international tariffs, social, political and economic risks and acts of war or terrorism.
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• |
a limited availability of market quotations for New Cvent’s securities;
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• |
reduced liquidity for New Cvent’s securities;
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• |
a determination that New Cvent Common Stock is a “penny stock” which will require brokers trading in New Cvent Common Stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for New Cvent’s securities;
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• |
a limited amount of news and analyst coverage; and
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• |
a decreased ability to issue additional securities or obtain additional financing in the future.
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• |
the ability of the New Cvent Board to issue shares of New Cvent Preferred Stock, including “blank check” preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer;
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• |
the limitation of the liability of, and the indemnification of, New Cvent’s directors and officers;
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• |
the requirement that a special meeting of stockholders may be called only by a majority of the entire New Cvent Board, which could delay the ability of stockholders to force consideration of a proposal or to take action, including the removal of directors;
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• |
controlling the procedures for the conduct and scheduling of board of directors and stockholder meetings;
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• |
the ability of the New Cvent Board to amend the bylaws, which may allow the New Cvent Board to take additional actions to prevent an unsolicited takeover and inhibit the ability of an acquirer to amend the bylaws to facilitate an unsolicited takeover attempt; and
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• |
advance notice procedures with which stockholders must comply to nominate candidates to the New Cvent Board or to propose matters to be acted upon at a stockholders’ meeting, which could preclude stockholders from bringing matters before annual or special meetings of stockholders and delay changes in the New Cvent Board, and also may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of New Cvent.
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• |
a proposal to approve by ordinary resolution and adopt the Business Combination Agreement, including the Mergers, and the transactions contemplated thereby;
|
• |
a proposal to approve by special resolution the Domestication;
|
• |
a proposal to approve by special resolution the adoption and approval of the Proposed Certificate of Incorporation and Proposed Bylaws;
|
• |
the following five separate proposals to approve, on a non-binding advisory basis, by ordinary resolution the following material differences between the Existing Governing Documents and the Proposed Governing Documents:
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• |
to authorize the change in the authorized share capital of Dragoneer from US$22,100 divided into (i) 200,000,000 Class A ordinary shares, par value $0.0001 per share, 20,000,000 Class B ordinary shares, par value $0.0001 per share, and 1,000,000 preference shares, par value $0.0001 per share, to (ii) 1,500,000,000 shares of New Cvent Common Stock and 1,000,000 shares of New Cvent Preferred Stock;
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• |
to authorize the New Cvent Board to issue any or all shares of New Cvent Preferred Stock in one or more classes or series, with such terms and conditions as may be expressly determined by the New Cvent Board and as may be permitted by the DGCL;
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• |
to provide that certain provisions of the certificate of incorporation of New Cvent are subject to the Investor Rights Agreement;
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• |
the removal of the ability of New Cvent stockholders to take action by written consent in lieu of a meeting; and
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• |
to amend and restate the Existing Governing Documents and authorize all other changes in connection with the replacement of Existing Governing Documents with the Proposed Governing Documents as part of the Domestication, including (i) changing the post-Business Combination corporate name from “Dragoneer Growth Opportunities Corp. II” to “Cvent Holding Corp.” (which is expected to occur upon the effectiveness of the Domestication), (ii) making New
|
Cvent’s corporate existence perpetual, (iii) adopting Delaware as the exclusive forum for certain stockholder litigation and the United States District Court for the District of Delaware as the exclusive forum for litigation arising out of the Securities Act, (iv) electing to not be governed by Section 203 of the DGCL and (v) removing certain provisions related to our status as a blank check company that will no longer be applicable upon consummation of the Business Combination, all of which the Dragoneer Board believes is necessary to adequately address the needs of New Cvent after the Business Combination.
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• |
a proposal to approve by ordinary resolution shares of New Cvent Common Stock issued in connection with the Business Combination and the PIPE Financing pursuant to Nasdaq Listing Rule 5635;
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• |
a proposal to approve and adopt by ordinary resolution the 2021 Plan;
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• |
a proposal to approve and adopt by ordinary resolution the Employee Stock Purchase Plan; and
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• |
a proposal to approve by ordinary resolution the adjournment of the extraordinary general meeting to a later date or dates to, among other things, permit further solicitation and vote of proxies in the event that there are insufficient votes for the approval of one or more proposals at the extraordinary general meeting.
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• |
You can vote by signing and returning the enclosed proxy card. If you vote by proxy card, your “proxy,” whose name is listed on the proxy card, will vote your shares as you instruct on the proxy card. If you sign and return the proxy card but do not give instructions on how to vote your shares, your shares will be voted as recommended by the Dragoneer Board “FOR” the Business Combination Proposal, “FOR” the Domestication Proposal, “FOR” the Proposed Charter and Bylaws Proposal, “FOR” each of the separate Advisory Governing Documents Proposals, “FOR” the Nasdaq Proposal, “FOR” the Incentive Equity Plan Proposal, “FOR” the ESPP Proposal and “FOR” the Adjournment Proposal, in each case, if presented to the extraordinary general meeting. Votes received after a matter has been voted upon at the extraordinary general meeting will not be counted.
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• |
You can attend the extraordinary general meeting and vote in person, or you may attend the extraordinary general meeting virtually and vote electronically. However, if your shares are held in the name of your broker, bank or another nominee, you must get a valid legal proxy from the broker, bank or other nominee. That is the only way Dragoneer can be sure that the broker, bank or nominee has not already voted your shares.
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• |
you may send another proxy card with a later date;
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• |
you may notify Dragoneer’s general counsel in writing before the extraordinary general meeting that you have revoked your proxy; or
|
• |
you may attend the extraordinary general meeting, revoke your proxy, and vote in person or electronically, as indicated above.
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(i) |
hold public shares;
|
(ii) |
submit a written request to Continental, Dragoneer’s transfer agent, in which you (i) request that New Cvent redeem all or a portion of your public shares for cash, and (ii) identify yourself as the beneficial holder of the public shares and provide your legal name, phone number and address; and
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(iii) |
deliver your share certificates (if any) and other redemption forms (as applicable) to Continental, Dragoneer’s transfer agent, physically or electronically through DTC.
|
(a) |
On the Closing Date, prior to the time at which the First Effective Time occurs, Dragoneer will change its jurisdiction of incorporation by deregistering as a Cayman Islands exempted company and continuing and domesticating as a corporation incorporated under the laws of the State of Delaware, upon which Dragoneer will change its name to “Cvent Holding Corp.”; and
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(b) |
the parties to the Business Combination Agreement will cause two certificates of merger to be executed and filed with the Secretary of State of the State of Delaware, pursuant to which, respectively, (i) Merger Sub I will merge with and into Cvent, with Cvent as the surviving company in the First Merger and (ii) Cvent as the surviving company in the First Merger will merge with and into Merger Sub II, with Merger Sub II as the surviving company in the Second Merger, and, after giving effect to such mergers, Merger Sub II will be a wholly-owned subsidiary of Dragoneer. In accordance with the terms and subject to the conditions of the Business Combination Agreement, at the Second Effective Time, each share and equity award of Cvent outstanding as of immediately prior to the Second Effective Time will be exchanged for shares of New Cvent Common Stock or comparable equity awards that are settled or are exercisable for shares of New Cvent Common Stock, as applicable, based on an implied Cvent equity value of $4,467,973,959 plus the aggregate exercise price for all in-the-money Cvent Equity Awards issued and outstanding as of immediately prior to the First Effective Time.
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• |
each issued and outstanding Class A ordinary share of Dragoneer will convert automatically by operation of law, on a one-for-one basis, into shares of New Cvent Common Stock;
|
• |
each issued and outstanding Class B ordinary share of Dragoneer will convert automatically by operation of law, on a one-for-one basis, into shares of New Cvent Common Stock;
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• |
the governing documents of Dragoneer will be amended and restated and become the certificate of incorporation and the bylaws as described in this proxy statement/prospectus/consent solicitation and Dragoneer’s name will change to “Cvent Holding Corp.”; and
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• |
the form of the certificate of incorporation and the bylaws will be appropriately adjusted to give effect to any amendments contemplated by the form of certificate of incorporation or the bylaws that are not adopted and approved by the Dragoneer shareholders.
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• |
the applicable waiting period under the HSR Act relating to the Business Combination having been expired or been terminated;
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• |
no order or law issued by any court of competent jurisdiction or other governmental entity or other legal restraint or prohibition preventing the consummation of the transactions contemplated by Business Combination being in effect;
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• |
this registration statement/proxy statement becoming effective in accordance with the provisions of the Securities Act, no stop order having been issued by the SEC and remaining in effect with respect to this registration statement/proxy statement, and no proceeding seeking such a stop order having been threatened or initiated by the SEC and remaining pending;
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• |
the approval of the Business Combination Agreement, the ancillary documents to the Business Combination Agreement to which Cvent is or will be a party and the transactions contemplated by each of the foregoing agreements (including the Mergers) being obtained by the requisite number of shareholders of Cvent in accordance with the DGCL, Cvent’s governing documents and Cvent’s shareholders agreement;
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• |
the approval of each Condition Precedent Proposal by the affirmative vote of the holders of the requisite number of ordinary shares of Dragoneer being obtained in accordance with Dragoneer’s Governing Documents and applicable law;
|
• |
after giving effect to the transactions contemplated by the Business Combination Agreement (including the PIPE Financing), Dragoneer having at least $5,000,001 of net tangible assets (as determined in accordance with Rule 3a51-1(g)(1) of the Exchange Act) immediately after the First Effective Time;
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• |
the listing of the New Cvent Common Stock on Nasdaq, and Nasdaq having raised no objection to the continued listed of the New Cvent Common Stock; and
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• |
as of immediately prior to Closing, the result equal to: (i) the cash in the trust account, minus (ii) the amount redeemed by the holders of Dragoneer Class A ordinary shares as provided in the Existing Governing Documents, plus (iii) the aggregate amount received by Dragoneer from the PIPE Financing, plus (iv) the aggregate amount received by Dragoneer under the Forward Purchase Agreement not being less than $356,000,000; provided, that, notwithstanding the foregoing, this condition will be deemed satisfied with respect to Dragoneer if (x) the amount contemplated by clause (iv) was not funded in full and (y) had such amount been funded in full, the condition would have been satisfied; provided further, that if one or more Pipe Investors does not fund its portion of the PIPE Financing amount, Sponsor, any of its affiliates or another investor reasonably acceptable to Sponsor and Cvent may invest on the same terms as such defaulting PIPE Investor and such amount shall be deemed to be part of the PIPE Financing amount for purposes of this condition.
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• |
the representations and warranties of Cvent regarding organization and qualification of Cvent and its subsidiaries, certain representations and warranties regarding the capitalization, and amounts payable upon a change in control, of Cvent and the representations and warranties of Cvent regarding the authority of Cvent to, among other things, consummate the transactions contemplated by the Business Combination Agreement, and brokers fees being true and correct (without giving effect to any limitation of “materiality” or “Cvent Material Adverse Effect” (as defined in the Business Combination Agreement) or any similar limitation set forth in the Business Combination Agreement) in all material respects as of the Closing Date as if made at and as of such date (or, if given as of an earlier date, as of such earlier date);
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• |
certain other representations and warranties regarding the capitalization of Cvent being true and correct in all respects (except for de minimis inaccuracies) as of the Closing Date (or, if given as of an earlier date, as of such earlier date);
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• |
the representations and warranties regarding no occurrence of Cvent Material Adverse Effect being true and correct in all respects as of the Closing Date (or, if given as of an earlier date, as of such earlier date); provided that this condition shall be deemed to be satisfied if no Cvent Material Adverse Effect is continuing;
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• |
the other representations and warranties of Cvent being true and correct (without giving effect to any limitation as to “materiality” or “Cvent Material Adverse Effect” or any similar limitation set forth in
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the Business Combination Agreement) in all respects as of the Closing Date (or, if given as of an earlier date, as of such earlier date), except where the failure of such representations and warranties to be true and correct, taken as a whole, does not cause a Cvent Material Adverse Effect;
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• |
Cvent not being in material breach of the covenants and agreements required to be performed or complied with by it under the Business Combination Agreement prior to the Closing;
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• |
since the date of the Business Combination Agreement, no “Cvent Material Adverse Effect” shall have occurred that is continuing; and
|
• |
Dragoneer must have received a certificate executed by an authorized officer of Cvent confirming that the conditions set forth in the first six (6) bullet points in this section have been satisfied.
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• |
the representations and warranties regarding organization and qualification of the Dragoneer Parties, the authority of Dragoneer to execute and deliver the Business Combination Agreement, and each of the ancillary documents thereto to which it is or will be a party and to consummate the transactions contemplated thereby, certain representations and warranties regarding the capitalization of the Dragoneer Parties, the intended tax treatment of the Mergers and brokers fees being true and correct (without giving effect to any limitation of “materiality” or “Dragoneer Material Adverse Effect” (as defined in the Business Combination Agreement) or any similar limitation set forth in the Business Combination Agreement) in all material respects as of the Closing Date, as though made on and as of the Closing Date (or, if given as of an earlier date, as of such earlier date);
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• |
certain other representations and warranties regarding the capitalization of Dragoneer being true and correct in all respects (except for de minimis inaccuracies) as of the Closing Date (or, if given as of an earlier date, as of such earlier date);
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• |
the other representations and warranties of the Dragoneer Parties being true and correct (without giving effect to any limitation of “materiality” or “Dragoneer Material Adverse Effect” or any similar limitation set forth in the Business Combination Agreement) in all respects as of the Closing Date, except where the failure of such representations and warranties to be true and correct, taken as a whole, does not cause a Dragoneer Material Adverse Effect;
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• |
the Dragoneer Parties not being in material breach of the covenants and agreements required to be performed or complied with by them under the Business Combination Agreement;
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• |
the existing certificate of incorporation of Dragoneer being amended and restated in the form of the Proposed Certificate of Incorporation;
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• |
the members of the New Cvent Board having been duly elected, and the officers of New Cvent having been duly appointed; and
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• |
Cvent must have received a certificate executed by an authorized officer of Dragoneer confirming that the conditions set forth in the first four bullet points of this section have been satisfied.
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• |
Subject to certain exceptions or as consented to in writing by Dragoneer (such consent not to be unreasonably withheld, conditioned or delayed), prior to the Closing, Cvent will and will cause its
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subsidiaries to, operate the business of Cvent and its subsidiaries in the ordinary course in all material respects, use commercially reasonable efforts to maintain and preserve intact in all material respects the business organization, assets, properties and material business relations of Cvent and its subsidiaries, and use commercially reasonable efforts to accrue and collect amounts receivable, accrue and pay accounts payable and other expenses, establish reserves for uncollectible accounts and manage inventory in accordance with past custom and practice (including recent past practice in light of COVID-19).
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• |
Subject to certain exceptions, prior to the Closing, Cvent will and will cause its subsidiaries to, not do any of the following without Dragoneer’s consent (such consent not to be unreasonably withheld, conditioned or delayed except in the case of the first, second, fourth, fifth, thirteenth, fifteenth, sixteenth and seventeenth sub-bullets below):
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• |
declare, set aside, make or pay any dividends or distribution or payment in respect of, or repurchase any outstanding, any equity securities of Cvent or any subsidiary for a price greater than the Transaction Share Consideration (as defined in the Business Combination Agreement) from any person (other than employees whose employment with Cvent or any subsidiary terminate on or after the date of the Business Combination Agreement);
|
• |
merge, consolidate, combine or amalgamate with any person or purchase or otherwise acquire any business entity or organization;
|
• |
adopt any amendments, supplements, restatements or modifications to any Cvent governing documents or the Cvent shareholders agreement;
|
• |
dispose or subject to a lien any equity interests of Cvent or its subsidiaries or issue any options or other rights obligating Cvent or any of its subsidiaries to issue any equity interests;
|
• |
sell, assign, abandon, lease, license or otherwise dispose of, or subject to a lien, any material assets or material properties of Cvent or any of its subsidiaries;
|
• |
incur, create or assume any indebtedness other than ordinary course trade payables;
|
• |
make any loans, advances or capital contributions to, or guarantees for the benefit of, or any investments in, any person;
|
• |
(A) amend or modify the Credit Agreement or waive any rights thereunder in a manner that is materially adverse (when taken as a whole) to the Dragoneer Parties or (B)(i) materially fail to comply with the terms of the Credit Agreement in a manner that will result in an event of default under the Credit Agreement and (ii) fail to promptly notify Dragoneer of any default under the Credit Agreement of which Cvent is aware or any event of default under the Credit Agreement, in each case, after the date of the Business Combination Agreement;
|
• |
adopt or amend any benefit plan or increase the compensation or benefits payable to any director, officer, or employee or take any action to accelerate any payment or benefit payable to any such person;
|
• |
waive or release any noncompetition, non-solicitation, no-hire, nondisclosure or other restrictive covenant obligation of any current or former director, manager, officer, key employee, or individual independent contractor, or hire or engage, or terminate the employment or engagement, of any employee or individual independent contractor;
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• |
make, change or revoke any material tax election, enter into any material tax closing agreement, settle any material tax claim or assessment, or consent to any extension or waiver of the limitation period applicable to or relating to any material tax claim or assessment, other than any such extension or waiver obtained in the ordinary course of business;
|
• |
enter into any settlements in excess of a certain threshold or that impose any material non-monetary obligations on Cvent or any of its subsidiaries after the Closing;
|
• |
authorize, recommend, propose or announce an intention to adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization, reorganization or similar transaction;
|
• |
make any material changes to the methods of accounting of Cvent or any of its subsidiaries, other changes that are made in accordance with Public Company Accounting Oversight Board standards;
|
• |
enter into any contract with any broker, finder, investment banker or other person under which such person would be entitled to any brokerage fee, finders’ fee or other commission;
|
• |
make any change of control payment that is not disclosed to Dragoneer on the Cvent disclosure schedules;
|
• |
amend, modify or terminate any material contracts or material contracts providing for any “change of control” payment; and
|
• |
make any payment to Vista or its affiliates (other than routine payments in the normal course of business and consistent with past practice).
|
• |
Cvent shall terminate certain affiliate contracts as set forth on the Cvent disclosure schedules effective as of the Closing.
|
• |
As promptly as reasonably practicable (and in any event, within two business days) following the date on which this proxy statement/prospectus/consent solicitation is declared effective, Cvent is required to obtain and deliver to Dragoneer a true and correct copy of a written consent of the Cvent Supporting Shareholders approving the Business Combination Agreement, the ancillary documents and the transactions contemplated thereby (including the Mergers), duly executed by the Cvent Supporting Shareholders required to approve and adopt such matters (the “
Cvent Shareholder Written Consent
”), and through its board of directors, will recommend to the Cvent Supporting Shareholders, the approval and adoption of the Business Combination Agreement, the ancillary documents and the transactions contemplated thereby (including the Mergers).
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• |
As promptly as reasonably practicable (and in any event prior to the earlier of (a) the time at which Cvent delivers the Allocation Schedule (as defined in the Business Combination Agreement) to Dragoneer or (b) the time at which Cvent is required to deliver to the Allocation Schedule to Dragoneer), Cvent will either (i) obtain and deliver to Dragoneer a true and correct copy of a written consent approving the Allocation Schedule, duly executed by the Cvent Supporting Shareholders required to approve such matters or (ii) amend or otherwise modify the governing documents of Cvent and each other contract to which Cvent is a party or bound, solely to the extent necessary for the Allocation Schedule to comply with the requirements set forth in the Business Combination Agreement.
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• |
At Closing, Cvent will and will cause its stockholders to deliver to Dragoneer a counterpart to the Amended and Restated Registration Rights Agreement and Investor Rights Agreement to which they are a party.
|
• |
Subject to certain exceptions, prior to the Closing, Cvent will purchase a “tail” policy providing liability insurance coverage for Cvent directors and officers with respect to matters occurring on or prior to the Closing.
|
• |
Subject to certain exceptions (including the ability of any Dragoneer Party to use funds held by Dragoneer outside the Trust Account to pay any Dragoneer expenses or liabilities to distribute or pay over any funds held by Dragoneer outside the Trust Account to the Sponsor or any of its affiliates, in each case, prior to the Closing) or as consented to in writing by Cvent, prior to the Closing, Dragoneer will, and will cause its subsidiaries to, not do any of the following:
|
• |
adopt any amendments, supplements, restatements or modifications to the Dragoneer trust agreement, Forward Purchase Agreement, or the governing documents of Dragoneer or any of its subsidiaries;
|
• |
declare, set aside, make or pay any dividends or distribution or payment in respect of, or repurchase any outstanding, any equity securities of Dragoneer or any subsidiary;
|
• |
split, combine or reclassify any of its capital stock or other equity securities or issue any other security in respect of, in lieu of or in substitution for shares of its capital stock;
|
• |
incur, create or assume any indebtedness or other liability, except for indebtedness for borrowed money in an amount not to exceed $2,000,000 in the aggregate;
|
• |
make any loans or advances to, or capital contributions in, any other person, other than to, or in, Dragoneer or any of its subsidiaries;
|
• |
issue any equity securities of Dragoneer or any of its subsidiaries or grant any additional options, or stock appreciation rights with respect to equity securities of the foregoing of Dragoneer or any of its subsidiaries;
|
• |
enter into, renew, modify or revise any Dragoneer related party transaction;
|
• |
engage in any activities or business, other than activities or business (i) in connection with or incidental or related to such person’s organization, incorporation or formation, as applicable, or continuing corporate (or similar) existence, (ii) contemplated by, or incidental or related to, the Business Combination Agreement, any ancillary document thereto, the performance of covenants or agreements thereunder or the consummation of the transactions contemplated thereby or (iii) those that are administrative or ministerial, in each case, which are immaterial in nature;
|
• |
make, change or revoke any material tax election other than any such extension or waiver obtained in the ordinary course of business;
|
• |
authorize, recommend, propose or announce an intention to adopt a plan of complete or partial liquidation or dissolution;
|
• |
enter into any contract providing for the payment of any brokerage fee, finders’ fee or other commission in connection with the transactions contemplated by the Business Combination Agreement; or
|
• |
enter into any contract to take, or cause to be taken, any of the actions set forth in the sub-bullets above.
|
• |
As promptly as reasonably practicable following the effectiveness of the registration statement of which this proxy statement/prospectus/consent solicitation forms a part, Dragoneer will duly give
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notice of and use its reasonable best efforts to duly convene and hold the extraordinary general meeting to approve the Condition Precedent Proposals.
|
• |
Subject to certain exceptions, Dragoneer shall use its reasonable best efforts to cause: (i) Dragoneer’s initial listing application with Nasdaq to have been approved; (ii) Dragoneer to satisfy all applicable initial and continuing listing requirements of Nasdaq; and (iii) the New Cvent Common Stock issuable in accordance with the Business Combination Agreement, including the Domestication and the Mergers, to be approved for listing on Nasdaq.
|
• |
Prior to the effectiveness of the of the registration statement of which this proxy statement/prospectus/consent solicitation forms a part, the Dragoneer Board will approve and adopt the 2021 Plan and with any changes or modifications thereto as Cvent and Dragoneer may mutually agree (such agreement not to be unreasonably withheld, conditioned or delayed by either Cvent or Dragoneer, as applicable), and Dragoneer will reserve [●] shares of New Cvent Common Stock for grant thereunder plus the number of shares of New Cvent Common Stock issuable upon the exercise or conversion of the Cvent equity awards.
|
• |
Prior to the effectiveness of this registration statement of which this proxy statement/prospectus/consent solicitation forms a part, the Dragoneer Board will approve and adopt the Employee Stock Purchase Plan substantially in the form as Cvent and Dragoneer mutually agree (such agreement not to be unreasonably withheld, conditioned or delayed by either Cvent or Dragoneer, as applicable), and Dragoneer will reserve [●] shares of New Cvent Common Stock for grant thereunder.
|
• |
At Closing, Dragoneer will and will cause the Dragoneer Parties to deliver to Cvent a counterpart to the Amended and Restated Registration Rights Agreement and Investor Rights Agreement to which they are a party.
|
• |
Subject to certain exceptions, prior to the Closing or termination of the Business Combination Agreement in accordance with its terms, Dragoneer shall not, and shall cause its subsidiaries and its and their respective representatives not to, directly or indirectly: (i) solicit, initiate, encourage (including by means of furnishing or disclosing information), facilitate, discuss or negotiate, directly or indirectly, any inquiry, proposal or offer (written or oral) with respect to a Dragoneer Acquisition Proposal; (ii) furnish or disclose any non-public information to any person in connection with, or that could reasonably be expected to lead to, a Dragoneer Acquisition Proposal; (iii) enter into any contract or other arrangement or understanding regarding a Dragoneer Acquisition Proposal; (iv) prepare or take any steps in connection with an offering of any securities of any Dragoneer Party (or any affiliate or successor of any Dragoneer Party); or (v) otherwise cooperate in any way with, or assist or participate in, or knowingly facilitate or encourage any effort or attempt by any person to do or seek to do any of the foregoing.
|
• |
using reasonable best efforts to consummate the Business Combination;
|
• |
notify the other party in writing promptly after learning of any shareholder demands or other shareholder proceedings relating to the Business Combination Agreement, any ancillary document or any matters relating thereto and reasonably cooperate with one another in connection therewith;
|
• |
keeping certain information confidential in accordance with the existing non-disclosure agreements;
|
• |
making relevant public announcements;
|
• |
using reasonable best efforts to cause the each of the Domestication and the Mergers to constitute a transaction treated as a “reorganization” within the meaning of Section 368 of the IRS Code; and
|
• |
cooperate in connection with certain tax matters and filings.
|
• |
by the mutual written consent of Dragoneer and Cvent;
|
• |
by Dragoneer, subject to certain exceptions, if any of the representations or warranties made by Cvent are not true and correct or if Cvent fails to perform any of its respective covenants or agreements under the Business Combination Agreement (including an obligation to consummate the Closing) such that certain conditions to the obligations of Dragoneer, as described in the section entitled “—Conditions to Closing of the Business Combination” above could not be satisfied and the breach (or breaches) of such representations or warranties or failure (or failures) to perform such covenants or agreements is (or are) not cured or cannot be cured within the earlier of (i) twenty (20) business days after written notice thereof, and (ii) the third business day prior to April 23, 2022 (the “
Termination Date
”);
|
• |
by Cvent, subject to certain exceptions, if any of the representations or warranties made by the Dragoneer Parties are not true and correct or if any Dragoneer Party fails to perform any of its covenants or agreements under the Business Combination Agreement (including an obligation to consummate the Closing) such that the condition to the obligations of Cvent, as described in the section entitled “—
Conditions to Closing of the Business Combination
|
• |
by either Dragoneer or Cvent, if the transactions contemplated by the Business Combination Agreement are not consummated on or prior to the Termination Date, unless the breach of any covenants or obligations under the Business Combination Agreement by the party seeking to terminate proximately caused the failure to consummate the transactions contemplated by the Business Combination Agreement;
|
• |
by either Dragoneer or Cvent, if any governmental entity shall have issued an order or taken any other action permanently enjoining, restraining or otherwise prohibiting the transactions contemplated by the Business Combination Agreement and such order or other action shall have become final and nonappealable;
|
• |
by Cvent, if the approval of the Condition Precedent Proposals are not obtained at the extraordinary general meeting (including any adjournment, recess or postponement thereof); and
|
• |
by Dragoneer, if Cvent does not deliver, or cause to be delivered to Dragoneer, the Cvent Shareholder Written Consent or the Cvent Shareholder Transaction Support Agreements when required under the Business Combination Agreement.
|
Assuming No
Redemptions (Shares) |
%
|
Assuming
Maximum Redemptions (Shares) |
%
|
|||||||||||||
Cvent Stockholders
|
416,351,853 | 77.9 | % | 416,351,853 | 82.1 | % | ||||||||||
Cvent options (1)
|
30,445,543 | 5.7 | % | 30,445,543 | 6.0 | % | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total shares issued in Business Combination
|
|
446,797,396
|
|
|
83.6
|
%
|
|
446,797,396
|
|
|
88.1
|
%
|
||||
Dragoneer’s public stockholders
|
27,600,000 | 5.2 | % | — | 0.0 | % | ||||||||||
Sponsor (2)
|
7,852,000 | 1.5 | % | 7,852,000 | 1.5 | % | ||||||||||
PIPE Investors (3)
|
52,500,000 | 9.8 | % | 52,500,000 | 10.4 | % | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Pro Forma Common Stock
|
|
534,749,396
|
|
|
100.0
|
%
|
|
507,149,396
|
|
|
100.0
|
%
|
||||
|
|
|
|
|
|
|
|
(1) |
Represents shares underlying Cvent options calculated on a net exercise basis, which represents an aggregate 51,764,924 outstanding Cvent options less implied share buybacks of approximately 21,319,381.
|
(2) |
Includes 6,900,000 Class B ordinary shares held by the Initial Shareholders, 752,000 private placement shares held by the Sponsor and 200,000 Class A ordinary shares to be received by the Sponsor from the conversion of the promissory note upon the consummation of the Business Combination.
|
(3) |
Includes 47,500,000 shares of New Cvent Common Stock issued to the PIPE Investors in the PIPE Financing and 5,000,000 shares of Class A ordinary shares to be purchased by Dragoneer Funding II LLC pursuant to the Forward Purchase Agreement and the Business Combination Agreement.
|
• |
a review of the materials provided in the virtual data room;
|
• |
requests for follow-up data and information from Cvent, including Cvent management responses to due diligence questions;
|
• |
several due diligence calls and discussions with members of Cvent’s management;
|
• |
financial and valuation analysis, including review of certain financial information provided by Cvent and comparisons to certain publicly traded companies; and
|
• |
legal matters, including those related to litigation matters, corporate matters (including material contracts, capitalization and other customary corporate matters), and labor and employment matters.
|
• |
Strong Historical Consolidated Financial Performance and Economic Model
|
• |
Favorable Prospects for Future Growth and Financial Performance
|
• |
Differentiated Technology Platform
|
expansion and cost efficiencies for its customers, which included half of the Fortune 500 as of June 30, 2021;
|
• |
Positioned for Future Growth.
|
• |
Competitive Differentiation that Increases with Scale
|
• |
Proven R&D Engine with an Exciting Product Roadmap
|
• |
Compelling Valuation
|
• |
World Class Management Team
|
• |
PIPE Financing Success
|
• |
Terms of the Business Combination Agreement and the Related Agreements
|
• |
Likelihood of Closing the Business Combination
|
• |
Benefits May Not Be Achieved
|
• |
Exercise of Redemption Rights of Current Public Shareholders
Risk Factors
|
• |
Conditions to Closing of the Business Combination
|
• |
Control of New Cvent by the Vista Investors Following Consummation of the Business Combination
|
• |
Litigation Related to the Business Combination
|
• |
Transaction Expenses Incurred by Dragoneer
|
• |
Negative Impact Resulting from the Announcement of the Business Combination
|
• |
Commitment under the Business Combination Agreement
|
• |
Other Risks
Risk Factors
|
Quarter Projection
Period Ended |
Full Year Projection Period Ended
|
|||||||||||||||||||
(millions)
|
September
30, 2021 |
December
31, 2021 |
December
31, 2021 |
December
31, 2022 |
December
31, 2023 |
|||||||||||||||
Projected Revenue(1)
|
$ | 129.4 | $ | 138.7 | $ | 507.4 | $ | 622.6 | $ | 762.6 | ||||||||||
Adjusted EBITDA(2)
|
n/a | n/a | $ | 90.0 | $ | 102.6 | $ | 136.1 |
1. |
Projected Revenue is based on a variety of assumptions, including (i) cross-selling and upselling products to existing clients, (ii) increase in the number of new customers less churn, (iii) assumptions about industry trends, such as the digitization of the events and meetings industry. Projected Revenue does not include any amounts for acquisitions or launching of new product lines, other than the extensions of certain product lines. Projected Revenue is a non-GAAP financial measure and should not be considered as an alternative to revenue. Non-GAAP financial measures are not necessarily calculated the same way by different companies and should not be considered a substitute for or superior to GAAP. Dragoneer relied on projected revenue because it believes it provides greater consistency and comparability with our past financial performance
|
and the financial performance of peer companies, as it eliminates the effects of certain variations unrelated to our overall performance. |
2. |
Adjusted EBITDA is defined as net loss adjusted for interest, taxes, depreciation and amortization, gains or losses on divestitures, other income or expense, restructuring expenses, impact of adjustments to acquired deferred revenue, costs related to acquisitions and other items that Cvent’s management does not believe are reflective of Cvent’s ongoing operations, some of which may be significant. Adjusted EBITDA is a non-GAAP financial measure and should not be considered as an alternative to operating income or net income as a measure of operating performance or cash flows as measures of liquidity. Non-GAAP financial measures are not necessarily calculated the same way by different companies and should not be considered a substitute for or superior to GAAP. Adjusted EBITDA is based on Cvent’s Projected Revenue forecast and a variety of cost assumptions, including (i) personnel and professional services related costs across client services, sales and marketing, research and development and general and administrative, (ii) variable costs related to revenue and product mix, (iii) costs associated with platform support and expansion and (iv) facilities.
|
• |
the global COVID-19 pandemic has and will continue to drive a new growth vector for virtual and hybrid events;
|
• |
the global COVID-19 pandemic has and will continue to accelerate automation and digitization of event-related processes and data;
|
• |
Cvent will experience strong revenue growth in product offerings that have been negatively impacted by the pandemic as the impact of the global COVID-19 pandemic diminishes and the meetings and events industry recovers;
|
• |
as a percentage of revenue, temporary investments will be made in the following areas:
|
• |
customer onboarding and support as event planners pivot to virtual and hybrid events; these increased levels of support will return to normal as customers gain more experience executing virtual and hybrid events;
|
• |
research and development to accelerate product development and support the increase in technology adoption by the meetings and events industry; and
|
• |
sales and marketing spend to support intensified demand for event management technology solutions.
|
• |
the fact that our Initial Shareholders have agreed not to redeem any Class A ordinary shares held by them in connection with a shareholder vote to approve a proposed initial business combination;
|
• |
the fact that the Sponsor paid an aggregate of $25,000 for the 6,900,000 Class B ordinary shares currently owned by the Initial Shareholders and such securities will have a significantly higher value at the time of the Business Combination;
|
• |
the fact that Sponsor paid $7,520,000 for its private placement shares which would be worthless if a business combination is not consummated by February 19, 2023 (unless such date is extended in accordance with the Existing Governing Documents);
|
• |
the fact that the Sponsor, the other Initial Shareholders and Dragoneer’s other current officers and directors have agreed to waive their rights to liquidating distributions from the trust account with respect to any ordinary shares (other than public shares) held by them if Dragoneer fails to complete an initial business combination by February 19, 2023;
|
• |
the fact that the Amended and Restated Registration Rights Agreement will be entered into by the Initial Shareholders;
|
• |
the fact that the Forward Purchaser agreed to purchase the Forward Purchase Shares immediately prior to the First Effective Time, but following the Domestication;
|
• |
the fact that, at the option of the Sponsor, any amounts outstanding under the loan made by the Sponsor to Dragoneer in an aggregate amount of up to $2,000,000 may be converted into Class A ordinary shares in connection with the consummation of the Business Combination;
|
• |
the continued indemnification of Dragoneer’s directors and officers and the continuation of Dragoneer’s directors’ and officers’ liability insurance after the Business Combination (
i.e
|
• |
the fact that the Sponsor and Dragoneer’s officers and directors will lose their entire investment in Dragoneer and will not be reimbursed for any out-of-pocket expenses if an initial business combination is not consummated by February 19, 2023;
|
• |
the fact that if the trust account is liquidated, including in the event Dragoneer is unable to complete an initial business combination by February 19, 2023, the Sponsor has agreed to indemnify Dragoneer to ensure that the proceeds in the trust account are not reduced below $10.00 per public share, or such lesser per public share amount as is in the trust account on the liquidation date, by the claims of prospective target businesses with which Dragoneer has entered into an acquisition agreement or claims of any third party for services rendered or products sold to Dragoneer, but only if such a vendor or target business has not executed a waiver of any and all rights to seek access to the trust account;
|
• |
the fact that Dragoneer may be entitled to distribute or pay over funds held by Dragoneer outside the Trust Account to the Sponsor or any of its affiliates prior to the Closing;
|
• |
the fact that the Sponsor sponsors multiple SPACs and is affiliated with a number of other investment vehicles and has the sole discretion to allocation this transaction to Dragoneer taking into account whatever factors it deems appropriate; and
|
• |
the fact that, based on the difference in the purchase price of approximately $0.008 per share that the Sponsor paid for the Founder Shares (as defined below), as compared to the purchase price of $10.00 per share sold in Dragoneer’s initial public offering, the Sponsor may earn a positive rate of return on its investment even if the share price of New Cvent Common Stock falls significantly below the per share value implied in the Business Combination of $10.00 per share and the public stockholders of Dragoneer experience a negative rate of return.
|
• |
Cvent’s existing stockholders will have a majority of the voting power in New Cvent, irrespective of whether Dragoneer’s public shareholders exercise their right to redeem their public shares;
|
• |
Cvent’s current largest shareholders will have the ability to nominate a majority of the initial members of the New Cvent Board;
|
• |
Cvent’s senior management will be the senior management of New Cvent;
|
• |
Cvent’s operations prior to the Business Combination will comprise the ongoing operations of New Cvent;
|
• |
Cvent is the larger entity based on historical operating activity and has the larger employee base; and
|
• |
The post-combination company will assume a “Cvent”-branded name: “Cvent Holding Corp.”
|
• |
Evaluation of Alternative Transactions
|
• |
Terms of the Business Combination Agreement
|
• |
Consideration Received by Cvent Stockholders
|
• |
Access to Capital
|
• |
Benefit from Being a Public Company
|
• |
Prominence, Predictability, and Flexibility of Delaware Law
|
• |
Well-Established Principles of Corporate Governance
|
and to the conduct of a company’s board of directors, such as under the business judgment rule and other standards. Because the judicial system is based largely on legal precedents, the abundance of Delaware case law provides clarity and predictability to many areas of corporate law. We believe such clarity would be advantageous to New Cvent, its board of directors and management and would enable them to make corporate decisions and take corporate actions with greater assurance as to the validity and consequences of those decisions and actions. Further, investors and securities professionals are generally more familiar with Delaware corporations, and the laws governing such corporations, increasing their level of comfort with Delaware corporations relative to entities organized in other jurisdictions. The Delaware courts have developed considerable expertise in dealing with corporate issues, and a substantial body of case law has developed construing Delaware law and establishing public policies with respect to corporate legal affairs. Moreover, Delaware’s vast body of law on the fiduciary duties of directors provides appropriate protection for New Cvent’s stockholders from possible abuses by directors and officers.
|
• |
Increased Ability to Attract and Retain Qualified Directors
|
Existing Governing Documents
|
Proposed Governing
Documents |
|||
Authorized Shares
Proposal A) |
The share capital under the Existing Governing Documents is US$22,100 divided into 200,000,000 Class A ordinary shares of par value US$0.0001 per share, 20,000,000 Class B ordinary shares of par value US$0.0001 per share and 1,000,000 preference shares of par value US$0.0001 per share. | The Proposed Governing Documents authorize 1,500,000,000 shares of New Cvent Common Stock and 1,000,000 shares of New Cvent Preferred Stock. | ||
See paragraph 5 of the Memorandum of Association.
|
See Article IV of the Proposed Certificate of Incorporation.
|
|||
Authorize the Board of Directors to Issue Preferred Stock Without Stockholder Consent
Proposal B) |
The Existing Governing Documents authorize the issuance of 1,000,000 preference shares with such designation, rights and preferences as may be determined from time to time by our board of directors. Accordingly, our board of directors is empowered under the Existing Governing Documents, without shareholder approval, to issue preference shares with dividend, liquidation, redemption, voting or other rights which could adversely affect the voting power or other rights of the holders of ordinary shares. | The Proposed Governing Documents authorize the board of directors to issue all or any shares of New Cvent Preferred Stock in one or more series and to fix for each such series such voting powers, full or limited, and such designations, preferences and relative, participating, optional or other special rights and such qualifications, limitations or restrictions thereof, as the board of directors may determine. | ||
See paragraph 5 of the Memorandum of Association and Article 3 of the Articles of Association.
|
See Article IV subsection B of the Proposed Certificate of Incorporation.
|
|||
Investor Rights Agreement
Proposal C) |
The Existing Governing Documents are not subject to any director composition agreement. | The Proposed Governing Documents provide that certain provisions therein are subject to the Investor Rights Agreement. |
• |
shares subject to awards granted under the 2021 Plan that are subsequently forfeited or cancelled;
|
• |
shares subject to awards granted under the 2021 Plan that otherwise terminate without shares being issued; and
|
• |
shares surrendered, cancelled or exchanged by the Company for cash (but not shares surrendered to pay the exercise price or withholding taxes associated with an award).
|
• |
NSOs.
|
• |
ISOs.
|
• |
Other Awards.
|
• |
Offering Periods and Purchase Periods.
|
• |
Enrollment and Contributions.
|
• |
Purchase Rights.
|
• |
Purchase Price.
|
• |
Withdrawal and Termination of Employment.
|
• |
financial institutions or financial services entities;
|
• |
broker-deals;
|
• |
S corporations;
|
• |
taxpayers that are subject to the mark-to-market accounting rules;
|
• |
tax-exempt entities;
|
• |
governments or agencies or instrumentalities thereof;
|
• |
insurance companies;
|
• |
regulated investment companies or real estate investment trusts;
|
• |
expatriates or former long-term residents of the United States;
|
• |
persons that actually or constructively own five percent or more of our voting shares or five percent or more of the total value of all classes of our shares (except as specifically addressed below);
|
• |
persons that acquired our securities pursuant to an exercise of employee share options, in connection with employee share incentive plans or otherwise as compensation;
|
• |
persons that hold our securities as part of a straddle, constructive sale, hedging, conversion or other integrated or similar transaction;
|
• |
persons whose functional currency is not the U.S. dollar;
|
• |
controlled foreign corporations;
|
• |
persons who purchase stock in New Cvent as part of the PIPE Financing;
|
• |
accrual method taxpayers that file applicable financial statements as described in Section 451(b) of the Code; or
|
• |
passive foreign investment companies.
|
• |
an individual citizen or resident of the United States;
|
• |
a corporation (or other entity that is treated as a corporation for U.S. federal income tax purposes) that is created or organized (or treated as created or organized) in or under the laws of the United States or any state thereof or the District of Columbia;
|
• |
an estate whose income is subject to U.S. federal income tax regardless of its source; or
|
• |
a trust if (i) a U.S. court can exercise primary supervision over the administration of such trust and one or more U.S. persons have the authority to control all substantial decisions of the trust or (ii) it has a valid election in place to be treated as a U.S. person.
|
A.
|
U.S. Holders That Hold 10 Percent or More of Dragoneer
|
B.
|
U.S. Holders That Own Less Than 10 Percent of Dragoneer
|
• |
(i) a statement that the Domestication is a Section 367(b) exchange (within the meaning of the applicable Treasury Regulations);
|
• |
(ii) a complete description of the Domestication;
|
• |
(iii) a description of any stock, securities or other consideration transferred or received in the Domestication;
|
• |
(iv) a statement describing the amounts required to be taken into account for U.S. federal income tax purposes;
|
• |
(v) a statement that the U.S. Holder is making the election including (A) a copy of the information that the U.S. Holder received from Dragoneer establishing and substantiating the U.S. Holder’s “all earnings and profits amount” with respect to the U.S. Holder’s public shares and (B) a representation that the U.S. Holder has notified Dragoneer (or New Cvent) that the U.S. Holder is making the election; and
|
• |
(vi) certain other information required to be furnished with the U.S. Holder’s tax return or otherwise furnished pursuant to the Code or the Treasury Regulations.
|
C.
|
U.S. Holders that Own Public Shares with a Fair Market Value of Less Than $50,000
|
A.
|
Definition of a PFIC
|
B.
|
PFIC Status of Dragoneer
|
C.
|
Effects of PFIC Rules on the Domestication
|
• |
the U.S. Holder’s gain will be allocated ratably over the U.S. Holder’s holding period for such U.S. Holder’s public shares;
|
• |
the amount of gain allocated to the U.S. Holder’s taxable year in which the U.S. Holder recognized the gain, or to the period in the U.S. Holder’s holding period before the first day of the first taxable year in which Dragoneer was a PFIC, will be taxed as ordinary income;
|
• |
the amount of gain allocated to other taxable years (or portions thereof) of the U.S. Holder and included in such U.S. Holder’s holding period would be taxed at the highest tax rate in effect for that year and applicable to the U.S. Holder; and
|
• |
an additional tax equal to the interest charge generally applicable to underpayments of tax will be imposed on the U.S. Holder in respect of the tax attributable to each such other taxable year of such U.S. Holder.
|
D.
|
QEF Election and Mark-to-Market Election
|
• |
such non-U.S. Holder is an individual who was present in the United States for 183 days or more in the taxable year of such disposition (subject to certain exceptions as a result of the COVID pandemic) and certain other requirements are met, in which case any gain realized will generally be subject to a flat 30% U.S. federal income tax;
|
• |
the gain is effectively connected with a trade or business of such non-U.S. Holder in the United States (and if an income tax treaty applies, is attributable to a U.S. permanent establishment or fixed base
|
maintained by such non-U.S. Holder), in which case such gain will be subject to U.S. federal income tax, net of certain deductions, at the same graduated individual or corporate rates applicable to U.S. Holders, and, if the non-U.S. Holder is a corporation, an additional “branch profits tax” may also apply; or
|
• |
New Cvent is or has been a “U.S. real property holding corporation” at any time during the shorter of the five-year period preceding such disposition and such non-U.S. Holder’s holding period and either (A) the shares of New Cvent Common Stock has ceased to be regularly traded on an established securities market or (B) such non-U.S. Holder has owned or is deemed to have owned, at any time during the shorter of the five-year period preceding such disposition and such non-U.S. Holder’s holding period more than 5% of outstanding shares of New Cvent Common Stock.
|
• |
subject us to negative economic, competitive and regulatory developments, any or all of which may have a substantial adverse impact on the particular industry in which we operate after our initial business combination; and
|
• |
cause us to depend on the marketing and sale of a single product or limited number of products or services.
|
Name
|
Age
|
Position
|
||||
Marc Stad
|
42 | Chairman and Chief Executive Officer | ||||
Pat Robertson
|
42 | President, Chief Operating Officer and Director | ||||
Sarah J. Friar
|
48 | Director | ||||
David D. Ossip
|
55 | Director | ||||
Gokul Rajaram
|
47 | Director | ||||
Jay Simons
|
48 | Director |
• |
meeting with our independent registered public accounting firm regarding, among other issues, audits, and adequacy of our accounting and control systems;
|
• |
monitoring the independence of the independent registered public accounting firm;
|
• |
verifying the rotation of the lead (or coordinating) audit partner having primary responsibility for the audit and the audit partner responsible for reviewing the audit as required by law;
|
• |
inquiring and discussing with management our compliance with applicable laws and regulations;
|
• |
pre-approving all audit services and permitted non-audit services to be performed by our independent registered public accounting firm, including the fees and terms of the services to be performed;
|
• |
appointing or replacing the independent registered public accounting firm;
|
• |
determining the compensation and oversight of the work of the independent registered public accounting firm (including resolution of disagreements between management and the independent auditor regarding financial reporting) for the purpose of preparing or issuing an audit report or related work;
|
• |
establishing procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting controls or reports which raise material issues regarding our financial statements or accounting policies;
|
• |
monitoring compliance on a quarterly basis with the terms of our initial public offering and, if any noncompliance is identified, immediately taking all action necessary to rectify such noncompliance or otherwise causing compliance with the terms of our initial public offering; and
|
• |
reviewing and approving all payments made to our existing shareholders, executive officers or directors and their respective affiliates. Any payments made to members of our audit committee will be reviewed and approved by our board of directors, with the interested director or directors abstaining from such review and approval.
|
• |
reviewing and approving on an annual basis the corporate goals and objectives relevant to our Chief Executive Officer’s compensation, evaluating our Chief Executive Officer’s performance in light of such goals and objectives and determining and approving the remuneration (if any) of our Chief Executive Officer based on such evaluation;
|
• |
reviewing and approving the compensation of all of our other Section 16 executive officers;
|
• |
reviewing our executive compensation policies and plans;
|
• |
implementing and administering our incentive compensation equity-based remuneration plans;
|
• |
assisting management in complying with our proxy statement and annual report disclosure requirements;
|
• |
approving all special perquisites, special cash payments and other special compensation and benefit arrangements for our executive officers and employees;
|
• |
producing a report on executive compensation to be included in our annual proxy statement; and
|
• |
reviewing, evaluating and recommending changes, if appropriate, to the remuneration for directors.
|
• |
duty to act in good faith in what the director or officer believes to be in the best interests of the company as a whole;
|
• |
duty to exercise powers for the purposes for which those powers were conferred and not for a collateral purpose;
|
• |
directors should not improperly fetter the exercise of future discretion;
|
• |
duty to exercise powers fairly as between different sections of shareholders;
|
• |
duty not to put themselves in a position in which there is a conflict between their duty to the company and their personal interests; and
|
• |
duty to exercise independent judgment.
|
Individual
|
Entity
|
Entity’s Business
|
Affiliation
|
|||
Marc Stad | Dragoneer Investment Group, LLC(1) | Asset Management | Founder, Chief Executive Officer, Chief Investment Officer and Managing Partner |
Individual
|
Entity
|
Entity’s Business
|
Affiliation
|
|||
Bragg Live Food Products, LLC | Health and Wellness Products | Director | ||||
AmWINS Group, Inc. | Insurance | Director | ||||
Dragoneer Growth Opportunities Corp. II | Special Purpose Acquisition Company | Chairman and Chief Executive Officer | ||||
Dragoneer Growth Opportunities Corp. III | Special Purpose Acquisition Company | Chairman and Chief Executive Officer | ||||
Pat Robertson | Dragoneer Investment Group, LLC(1) | Asset Management | President and Chief Operating Officer | |||
Dragoneer Growth Opportunities Corp. II | Special Purpose Acquisition Company | President, Chief Operating Officer and Director | ||||
Dragoneer Growth Opportunities Corp. III | Special Purpose Acquisition Company | President, Chief Operating Officer and Director | ||||
Sarah J. Friar | Nextdoor, Inc. | Social Network | Chief Executive Officer | |||
Walmart Inc. | Retail and Wholesale Operations | Director | ||||
Slack Technologies, Inc. | Messaging Platform | Director | ||||
Dragoneer Growth Opportunities Corp. II | Special Purpose Acquisition Company | Director | ||||
Dragoneer Growth Opportunities Corp. III | Special Purpose Acquisition Company | Director | ||||
David D. Ossip | Ceridian HCM Holding Inc. | Software | Chairman and Chief Executive Officer | |||
Ossip Consulting Inc. | Consulting Company | Director | ||||
Osaldac Corp. | Holding Company | Vice President | ||||
OsFund Inc. | Holding Company | Vice Chairman and Director | ||||
100 Wingarden Properties Ltd. | Real Estate | Director | ||||
Sunnybrook Health Sciences Centre | Hospital | Director | ||||
Dragoneer Growth Opportunities Corp. II | Special Purpose Acquisition Company | Director | ||||
Dragoneer Growth Opportunities Corp. III | Special Purpose Acquisition Company | Director | ||||
Gokul Rajaram | Pinterest Inc. | Social Network | Director |
Individual
|
Entity
|
Entity’s Business
|
Affiliation
|
|||
The Trade Desk Inc. | Digital Advertising Platform | Director | ||||
Course Hero, Inc. | Online Learning Platform | Director | ||||
Dragoneer Growth Opportunities Corp. II | Special Purpose Acquisition Company | Director | ||||
Dragoneer Growth Opportunities Corp. III | Special Purpose Acquisition Company | Director | ||||
Jay Simons | Hubspot, Inc. | Enterprise Software | Director | |||
Dragoneer Growth Opportunities Corp. II | Special Purpose Acquisition Company | Director | ||||
Dragoneer Growth Opportunities Corp. III | Special Purpose Acquisition Company | Director |
(1) |
Includes Dragoneer Investment Group, LLC and certain of its funds, affiliates, and other related entities, including certain portfolio companies in which the funds and other related entities invest.
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• |
Our executive officers and directors are not required to, and will not, commit their full time to our affairs, which results in conflicts of interest in allocating their time between our operations and our search for a business combination and their other businesses. We do not intend to have any full-time employees prior to the completion of our initial business combination. Each of our executive officers is engaged in several other business endeavors for which he may be entitled to substantial compensation, and our executive officers are not obligated to contribute any specific number of hours per week to our affairs.
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• |
Sponsor purchased Class B ordinary shares prior to our initial public offering and private placement shares in a transaction that closed concurrently with our initial public offering.
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• |
We entered into a forward purchase agreement with the Forward Purchaser, which is an affiliate of our Sponsor.
|
• |
Sponsor and each member of our management team have entered into an agreement with us, pursuant to which they have agreed to waive their redemption rights with respect to any Class B ordinary shares held by them in connection with (i) the completion of our initial business combination, and (ii) a shareholder vote to approve an amendment to our amended and restated memorandum and articles of association (A) that would modify the substance or timing of our obligation to provide holders of our Class A ordinary shares the right to have their shares redeemed in connection with our initial business combination or to redeem 100% of our public shares if we do not complete our initial business combination by February 19, 2023 or (B) with respect to any other provision relating to the rights of holders of our Class A ordinary shares. Additionally, our Sponsor has agreed to waive its rights to liquidating distributions from the trust account with respect to its Class B ordinary shares if we fail to complete our initial business combination within the prescribed time frame. If we do not complete our initial business combination within the prescribed time frame, the private placement shares will expire worthless. Except as described herein, our Sponsor and our directors and executive officers have agreed not to transfer, assign or sell any of their founder shares until the earliest of (A) one year after the completion of our initial business combination and (B) subsequent to our initial business combination, (x) if the closing price of our Class A ordinary shares equals or exceeds $12.00 per share (as adjusted for share subdivisions, share capitalizations, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 120 days after our initial business combination, or (y) the date on which we complete a liquidation, merger, share exchange or
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other similar transaction that results in all of our public shareholders having the right to exchange their ordinary shares for cash, securities or other property. Except as described herein, the private placement shares will not be transferable until 30 days following the completion of our initial business combination. Because each of our executive officers and directors owns ordinary shares directly or indirectly, they have a conflict of interest in determining whether a particular target business is an appropriate business with which to effectuate our initial business combination.
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• |
Our officers and directors may have a conflict of interest with respect to evaluating a particular business combination if the retention or resignation of any such officers and directors is included by a target business as a condition to any agreement with respect to our initial business combination. In addition, our founders, officers and directors may sponsor, form or participate in other blank check companies similar to ours during the period in which we are seeking an initial business combination. Any such companies may present additional conflicts of interest in pursuing an acquisition target, particularly in the event there is overlap among investment mandates.
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• |
Increase Efficiency by Automating Key Processes throughout the Event Lifecycle.
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a simple drag-and-drop interface, automated validation for best practices, logic checks and link checks, version history control and responsive design. Once built, these websites can be cloned and lightly edited to create new events in minutes. In addition to these processes, our solution also automates a number of traditionally manual processes throughout the event lifecycle, including processing online registrations and payments, collecting attendee information and preferences, creating custom schedules for attendees and automatically updating attendees of schedule changes via an event-specific mobile application. In the wake of the global COVID-19 pandemic, event organizers are able to deliver safer in-person events with our diagram check tools that provide accurate spacing of event floorplans and via contactless event and session check-in and lead capture products. Our platform automates many of the daily tasks of an event organizers, leaving them with more time to focus on other core valuable activities.
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• |
Increase Meeting and Event Attendance.
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• |
Enhance the Attendee, Sponsor, Exhibitor and Host or Venue Experience
|
• |
Create, Measure and Act on Attendee Engagement to Increase Sales Pipeline.
|
• |
Track, Manage and Measure Event Expenditure to Measure ROI of Events.
|
• |
Market to Event Organizers to Increase Events and Group Meetings Business Revenue.
|
• |
Enhance Productivity and Efficiency Through Automation.
|
• |
Strengthen Collaboration Between Hoteliers and Event Organizers.
|
• |
Better Analyze Operational Results through CSN Business Intelligence.
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• |
Depth and Breadth of Venue Profiles
.
|
• |
Billions in RFP Value.
|
• |
Integration with Hotels.
|
• |
Powerful Network Effects Across the Events Ecosystem.
|
• |
Efficiency for Planners.
|
• |
Lead Sourcing for Hoteliers and Venue Operators.
|
• |
A branded “virtual event lobby” that provides easy access to key event details, live and upcoming sessions and surveys;
|
• |
Immersive and interactive virtual sessions with enterprise-grade live or pre-recorded video, including on-demand offerings;
|
• |
A video production solution to help event professionals easily capture and produce broadcast-quality video content, whether live or pre-recorded, for online audiences, which permit event planners to easily capture and produce great-looking video content for more engaging webinars, and virtual events;
|
• |
Video conferencing capabilities to support collaborative sessions, virtual appointments and virtual meeting rooms;
|
• |
Powerful interactivity features including polling, live session Q&A, and chat;
|
• |
Gamification to encourage attendees to stay engaged by awarding them points for taking actions, such as joining a session, submitting feedback or visiting a virtual booth;
|
• |
Virtual roundtable discussions that connect attendees and enable them to network with one another; and
|
• |
Collected real-time feedback via session surveys.
|
• |
sponsoring and participating in user conferences, trade shows and industry events;
|
• |
customer advocacy marketing;
|
• |
public relations efforts; and
|
• |
social media marketing.
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Technology
|
Financial Services
|
Life Sciences
|
||
Cisco
Okta
Pendo
TeraData
Zoom
|
Lincoln Financial Group
Mastercard
Metlife
MorningStar
World Bank
|
BioHorizons
Bristol-Myers Squibb
Mednet
PENTAX Medical
Sonova USA, Inc.
|
||
CPG & Manufacturing
|
Professional Services
|
Education
|
||
Deere & Co.
Olympus
The Coca Cola Company
TruGreen
W.L.Gore
|
Cengage Learning
Deloitte & Touche
InXpress
KPMG
ServiceMaster Company
|
Duke University
Georgetown University
Penn State University
Univ. of Southern California
Yale University Central
IT Department
|
Association
|
Non-Profit
|
Government
|
||
American Association of Community
Colleges
American Diabetes Association
Association of American Medical
Colleges
California Teachers Association
National Education Association
|
Anti-Defamation League
Children’s Defense Fund
NAACP
The National Geographic Society
YMCA of the U.S.A.
|
California Public Employees
Retirement System
Federal Deposit Insurance Corporation (FDIC)
NASA Research & Education Support Services
National Institute of Health
U.S. Dept. Of State
|
||
Hotels
|
Convention & Visitor Bureaus
|
|
Accor
Best Western Hotels & Resorts
Marriott International Radisson Hotel Group
Taj Hotels, Palaces & Resorts
|
Visit Dallas
Visit Anaheim
New Orleans & Company
Department of Culture and Tourism Abu Dhabi
Hong Kong Tourism Board
|
|
Customer Count
|
12/31/2018
|
12/31/2019
|
6/30/2020
|
12/31/2020
|
6/30/2021
|
|||||||||||||||
Event Cloud | 11,051 | 13,006 | 12,902 | 12,018 | 10,822 | |||||||||||||||
Hospitality Cloud
|
11,044 | 14,102 | 14,895 | 13,883 | 12,268 | |||||||||||||||
Overall
|
|
21,944
|
|
|
26,725
|
|
|
27,400
|
|
|
25,532
|
|
|
22,725
|
|
• |
small and large event technology providers that compete with one or some of the components of our platform, such as event marketing, consumer ticketing, registration management, onsite solutions, mobile event apps and venue sourcing and booking;
|
• |
providers that exclusively offer point solutions for hosting events;
|
• |
in-house developed solutions that are difficult to maintain and do not integrate into marketing automation or CRM systems;
|
• |
meeting and event management firms that offer their own custom-built event technology or leverage other commercial tools to run events for organizations of all sizes;
|
• |
venue searches and bookings processed by phone or email, and budget and expense through spreadsheets;
|
• |
online group sourcing and booking solutions, including group buying websites, consolidators and wholesalers of meeting products and services, and search websites; and
|
• |
hotel and venue direct websites and their call centers that provide direct sourcing and booking solutions.
|
• |
breadth and depth of feature set;
|
• |
pricing;
|
• |
user experience;
|
• |
financial viability;
|
• |
industry expertise;
|
• |
proven customer references;
|
• |
global client support and implementation services;
|
• |
scalability and security;
|
• |
privacy and industry-specific compliance with regulations;
|
• |
integration into other enterprise software solutions; and
|
• |
terms and commissions for direct booking.
|
• |
Denominator:
|
• |
Numerator:
|
Three Months Ended June 30,
|
||||||||
2021
|
2020
|
|||||||
(in thousands, apart from percentage)
|
||||||||
Revenue by cloud:
|
||||||||
Event cloud
|
$ | 85,590 | $ | 76,703 | ||||
Hospitality cloud
|
37,224 | 48,455 | ||||||
|
|
|
|
|||||
Total revenue
|
$ | 122,814 | $ | 125,158 | ||||
|
|
|
|
|||||
Percentage of revenue by cloud:
|
||||||||
Event cloud
|
69.7 | % | 61.3 | % | ||||
Hospitality cloud
|
30.3 | % | 38.7 | % | ||||
|
|
|
|
|||||
Total
|
100.0 | % | 100.0 | % | ||||
|
|
|
|
Six Months Ended June 30,
|
||||||||
2021
|
2020
|
|||||||
(in thousands, apart from percentage)
|
||||||||
Revenue by cloud:
|
||||||||
Event cloud
|
$ | 166,723 | $ | 165,158 | ||||
Hospitality cloud
|
73,378 | 99,550 | ||||||
|
|
|
|
|||||
Total revenue
|
$ | 240,101 | $ | 264,708 | ||||
|
|
|
|
|||||
Percentage of revenue by cloud:
|
||||||||
Event cloud
|
69.4 | % | 62.4 | % | ||||
Hospitality cloud
|
30.6 | % | 37.6 | % | ||||
|
|
|
|
|||||
Total
|
100.0 | % | 100.0 | % | ||||
|
|
|
|
Years Ended December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
(in thousands, apart from percentage)
|
||||||||||||
Revenue by cloud:
|
||||||||||||
Event cloud
|
$ | 316,080 | $ | 379,216 | $ | 325,219 | ||||||
Hospitality cloud
|
182,620 | 188,388 | 154,796 | |||||||||
|
|
|
|
|
|
|||||||
Total revenue
|
$ | 498,700 | $ | 567,604 | $ | 480,015 | ||||||
|
|
|
|
|
|
|||||||
Percentage of revenue by cloud:
|
||||||||||||
Event cloud
|
63.4 | % | 66.8 | % | 67.8 | % | ||||||
Hospitality cloud
|
36.6 | % | 33.2 | % | 32.2 | % | ||||||
|
|
|
|
|
|
|||||||
Total
|
100.0 | % | 100.0 | % | 100.0 | % | ||||||
|
|
|
|
|
|
Three Months Ended
June 30, |
||||||||
2021
|
2020
|
|||||||
(in thousands)
|
||||||||
Consolidated Statement of Operations and Comprehensive Loss Data:
|
||||||||
Revenue:
|
||||||||
Event cloud
|
$ | 85,590 | $ | 76,703 | ||||
Hospitality cloud
|
37,224 | 48,455 | ||||||
|
|
|
|
|||||
Total revenue
|
122,814 | 125,158 | ||||||
Cost of revenue
|
45,999 | 42,485 | ||||||
|
|
|
|
|||||
Gross profit
|
76,815 | 82,673 | ||||||
Operating expenses:
|
||||||||
Sales and marketing
|
33,070 | 32,474 | ||||||
Research and development
|
24,657 | 22,875 | ||||||
General and administrative
|
21,600 | 20,446 | ||||||
Intangible asset amortization, exclusive of amounts included in cost of revenue
|
12,929 | 13,468 | ||||||
|
|
|
|
|||||
Total operating expenses
|
92,256 | 89,263 | ||||||
|
|
|
|
|||||
Loss from operations
|
(15,441 | ) | (6,590 | ) | ||||
Interest expense
|
(7,638 | ) | (8,828 | ) | ||||
Amortization of deferred financial costs and debt discount
|
(941 | ) | (951 | ) | ||||
Loss on divestures, net
|
— | (9,634 | ) | |||||
Other income, net
|
3,998 | 20 | ||||||
|
|
|
|
|||||
Loss before income taxes
|
(20,022 | ) | (25,983 | ) | ||||
Provision for income taxes
|
1,825 | 2,018 | ||||||
|
|
|
|
|||||
Net loss
|
$ | (21,847 | ) | $ | (28,001 | ) | ||
|
|
|
|
Three Months Ended June 30,
|
||||||||
2021
|
2020
|
|||||||
Consolidated Statement of Operations and Comprehensive Loss Data:
|
||||||||
Revenue:
|
||||||||
Event cloud
|
69.7 | % | 61.3 | % | ||||
Hospitality cloud
|
30.3 | % | 38.7 | % | ||||
|
|
|
|
|||||
Total revenue
|
100.0 | % | 100.0 | % | ||||
Cost of revenue
|
37.5 | % | 33.9 | % | ||||
|
|
|
|
|||||
Gross profit
|
62.5 | % | 66.1 | % | ||||
Operating expenses:
|
||||||||
Sales and marketing
|
26.9 | % | 25.9 | % | ||||
Research and development
|
20.1 | % | 18.3 | % | ||||
General and administrative
|
17.6 | % | 16.3 | % | ||||
Intangible asset amortization, exclusive of amounts included in cost of revenue
|
10.5 | % | 10.8 | % | ||||
|
|
|
|
|||||
Total operating expenses
|
75.1 | % | 71.3 | % | ||||
|
|
|
|
|||||
Loss from operations
|
(12.6 | )% | (5.3 | )% | ||||
Interest expense
|
(6.2 | )% | (7.1 | )% | ||||
Amortization of deferred financial costs and debt discount
|
(0.8 | )% | (0.8 | )% | ||||
Loss on divestures, net
|
0.0 | % | (7.7 | )% | ||||
Other income, net
|
3.3 | % | 0.0 | % | ||||
|
|
|
|
|||||
Loss before income taxes
|
(16.3 | )% | (20.8 | )% | ||||
Provision for income taxes
|
1.5 | % | 1.6 | % | ||||
|
|
|
|
|||||
Net loss
|
(17.8 | )% | (22.4 | )% | ||||
|
|
|
|
Three Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Revenue:
|
||||||||||||||||
Event Cloud
|
$ | 85,590 | $ | 76,703 | $ | 8,887 | 11.6 | % | ||||||||
Hospitality Cloud
|
37,224 | 48,455 | (11,231 | ) | (23.2 | )% | ||||||||||
|
|
|
|
|
|
|||||||||||
Total revenue
|
$ | 122,814 | $ | 125,158 | $ | (2,344 | ) | (1.9 | )% | |||||||
|
|
|
|
|
|
Three Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Cost of revenue
|
$ | 45,999 | $ | 42,485 | $ | 3,514 | 8.3 | % |
Three Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Operating Expenses:
|
||||||||||||||||
Sales and marketing
|
$ | 33,070 | $ | 32,474 | $ | 596 | 1.8 | % | ||||||||
Research and development
|
24,657 | 22,875 | 1,782 | 7.8 | % | |||||||||||
General and administrative
|
21,600 | 20,446 | 1,154 | 5.6 | % | |||||||||||
Intangible asset amortization, exclusive of amounts included in cost of revenue
|
12,929 | 13,468 | (539 | ) | (4.0 | )% | ||||||||||
|
|
|
|
|
|
|||||||||||
Total operating expenses
|
$ | 92,256 | $ | 89,265 | $ | 2,991 | 3.4 | % | ||||||||
|
|
|
|
|
|
Three Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Interest expense
|
$ | (7,638 | ) | $ | (8,828 | ) | $ | 1,190 | (13.5 | )% |
Three Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Amortization of deferred financing costs and debt discount
|
$ | (941 | ) | $ | (951 | ) | $ | 10 | 1.1 | % |
Three Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Loss on divestitures, net
|
$ | — | $ | (9,634 | ) | $ | 9,634 | 100.0 | % |
Three Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Other income, net
|
$ | 3,998 | $ | 20 | $ | 3,978 | 19,890.0 | % |
Three Months
Ended June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Provision for income taxes
|
$ | 1,825 | $ | 2,018 | $ | (193 | ) | (9.6 | )% |
Six Months Ended June 30,
|
||||||||
2021
|
2020
|
|||||||
(in thousands)
|
||||||||
Consolidated Statement of Operations and Comprehensive Loss Data: :
|
||||||||
Revenue:
|
||||||||
Event cloud
|
$ | 166,723 | $ | 165,158 | ||||
Hospitality cloud
|
73,378 | 99,550 | ||||||
|
|
|
|
|||||
Total revenue
|
240,101 | 264,708 | ||||||
Cost of revenue
|
89,844 | 94,446 | ||||||
|
|
|
|
|||||
Gross profit
|
150,257 | 170,262 | ||||||
Operating expenses:
|
||||||||
Sales and marketing
|
61,907 | 70,539 | ||||||
Research and development
|
46,331 | 48,021 | ||||||
General and administrative
|
38,354 | 43,638 | ||||||
Intangible asset amortization, exclusive of amounts included in cost of revenue
|
25,964 | 26,925 | ||||||
|
|
|
|
|||||
Total operating expenses
|
172,556 | 189,123 | ||||||
|
|
|
|
|||||
Loss from operations
|
(22,299 | ) | (18,861 | ) | ||||
Interest expense
|
(15,171 | ) | (19,544 | ) | ||||
Amortization of deferred financial costs and debt discount
|
(1,884 | ) | (1,904 | ) | ||||
Loss on divestures, net
|
— | (9,634 | ) | |||||
Other income, net
|
4,271 | 1,457 | ||||||
|
|
|
|
|||||
Loss before income taxes
|
(35,083 | ) | (48,486 | ) | ||||
Provision for income taxes
|
3,325 | 4,222 | ||||||
|
|
|
|
|||||
Net loss
|
$ | (38,408 | ) | $ | (52,708 | ) | ||
|
|
|
|
Six Months Ended June 30,
|
||||||||
2021
|
2020
|
|||||||
Consolidated Statement of Operations and Comprehensive Loss Data:
|
||||||||
Revenue:
|
||||||||
Event cloud
|
69.4 | % | 62.4 | % | ||||
Hospitality cloud
|
30.6 | % | 37.6 | % | ||||
|
|
|
|
|||||
Total revenue
|
100.0 | % | 100.0 | % | ||||
Cost of revenue
|
37.4 | % | 35.7 | % | ||||
|
|
|
|
|||||
Gross profit
|
62.6 | % | 64.3 | % | ||||
Operating expenses:
|
||||||||
Sales and marketing
|
25.8 | % | 26.6 | % | ||||
Research and development
|
19.3 | % | 18.1 | % | ||||
General and administrative
|
16.0 | % | 16.5 | % | ||||
Intangible asset amortization, exclusive of amounts included in cost of revenue
|
10.8 | % | 10.2 | % | ||||
|
|
|
|
|||||
Total operating expenses
|
71.9 | % | 71.4 | % | ||||
|
|
|
|
|||||
Loss from operations
|
(9.3 | )% | (7.1 | )% | ||||
Interest expense
|
(6.3 | )% | (7.4 | )% | ||||
Amortization of deferred financial costs and debt discount
|
(0.8 | )% | (0.7 | )% | ||||
Loss on divestures, net
|
0.0 | % | (3.6 | )% | ||||
Other income, net
|
1.8 | % | 0.6 | % | ||||
|
|
|
|
|||||
Loss before income taxes
|
(14.6 | )% | (18.3 | )% | ||||
Provision for income taxes
|
1.4 | % | 1.6 | % | ||||
|
|
|
|
|||||
Net loss
|
(16.0 | )% | (19.9 | )% | ||||
|
|
|
|
Six Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Revenue:
|
||||||||||||||||
Event cloud
|
$ | 166,723 | $ | 165,158 | $ | 1,565 | 0.9 | % | ||||||||
Hospitality cloud
|
73,378 | 99,550 | (26,172 | ) | (26.3 | )% | ||||||||||
|
|
|
|
|
|
|||||||||||
Total revenue
|
$ | 240,101 | $ | 264,708 | $ | (24,607 | ) | (9.3 | )% | |||||||
|
|
|
|
|
|
Six Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Cost of revenue
|
$ | 89,844 | $ | 94,446 | $ | (4,602 | ) | (4.9 | )% |
Six Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Operating Expenses:
|
||||||||||||||||
Sales and marketing
|
$ | 61,907 | $ | 70,539 | $ | (8,632 | ) | (12.2 | )% | |||||||
Research and development
|
46,331 | 48,021 | (1,690 | ) | (3.5 | % | ||||||||||
General and administrative
|
38,354 | 43,638 | (5,284 | ) | (12.1 | )% | ||||||||||
Intangible asset amortization, exclusive of amounts included in cost of revenue
|
25,964 | 26,925 | (961 | ) | (3.6 | )% | ||||||||||
|
|
|
|
|
|
|||||||||||
Total operating expenses
|
$ | 172,556 | $ | 189,123 | $ | (16,567 | ) | (8.8 | )% | |||||||
|
|
|
|
|
|
Six Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Interest expense
|
$ | (15,171 | ) | $ | (19,544 | ) | $ | 4,373 | 22.4 | % |
Six Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Amortization of deferred financing costs and debt discount
|
$ | (1,884 | ) | $ | (1,904 | ) | $ | (20 | ) | 1.1 | % |
Six Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Loss on divestitures, net
|
$ | — | $ | (9,634 | ) | $ | 9,634 | 100.0 | % |
Six Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Other income, net
|
$ | 4,271 | $ | 1,457 | $ | 2,814 | 193.1 | % |
Six Months Ended
June 30, |
||||||||||||||||
2021
|
2020
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Provision for income taxes
|
$ | 3,325 | $ | 4,222 | $ | (897 | ) | (21.2 | )% |
Year Ended December 31,
|
||||||||
2020
|
2019
|
|||||||
(in thousands)
|
||||||||
Consolidated Statement of Operations and Comprehensive Loss Data:
|
||||||||
Revenue:
|
||||||||
Event cloud
|
$ | 316,080 | $ | 379,216 | ||||
Hospitality cloud
|
182,620 | 188,388 | ||||||
|
|
|
|
|||||
Total revenue
|
498,700 | 567,604 | ||||||
Cost of revenue
|
176,250 | 211,857 | ||||||
|
|
|
|
|||||
Gross profit
|
322,450 | 355,747 | ||||||
Operating expenses:
|
||||||||
Sales and marketing
|
128,388 | 155,801 | ||||||
Research and development
|
87,866 | 96,012 | ||||||
General and administrative
|
80,564 | 92,018 | ||||||
Intangible asset amortization, exclusive of amounts included in cost of revenue
|
53,844 | 57,685 | ||||||
|
|
|
|
|||||
Total operating expenses
|
350,662 | 401,516 | ||||||
|
|
|
|
|||||
Loss from operations
|
(28,212 | ) | (45,769 | ) | ||||
Interest expense
|
(35,557 | ) | (47,875 | ) | ||||
Amortization of deferred financial costs and debt discount
|
(3,798 | ) | (3,836 | ) | ||||
Loss on divestures, net
|
(9,634 | ) | — | |||||
Other income/(expense), net
|
1,333 | (294 | ) | |||||
|
|
|
|
|||||
Loss before income taxes
|
(75,868 | ) | (97,774 | ) | ||||
Provision for/(benefit from) income taxes
|
7,865 | (6,013 | ) | |||||
|
|
|
|
|||||
Net loss
|
$ | (83,733 | ) | $ | (91,761 | ) | ||
|
|
|
|
Year Ended December 31,
|
||||||||
2020
|
2019
|
|||||||
Consolidated Statement of Operations and Comprehensive Loss Data:
|
||||||||
Revenue:
|
||||||||
Event cloud
|
63.4 | % | 66.8 | % | ||||
Hospitality cloud
|
36.6 | % | 33.2 | % | ||||
|
|
|
|
|||||
Total revenue
|
100.0 | % | 100.0 | % | ||||
Cost of revenue
|
35.3 | % | 37.3 | % | ||||
|
|
|
|
|||||
Gross profit
|
64.7 | % | 62.7 | % | ||||
Operating expenses:
|
||||||||
Sales and marketing
|
25.7 | % | 27.4 | % | ||||
Research and development
|
17.6 | % | 16.9 | % | ||||
General and administrative
|
16.2 | % | 16.2 | % | ||||
Intangible asset amortization, exclusive of amounts included in cost of revenue
|
10.8 | % | 10.2 | % | ||||
|
|
|
|
|||||
Total operating expenses
|
70.3 | % | 70.7 | % | ||||
|
|
|
|
|||||
Loss from operations
|
(5.7 | )% | (8.1 | )% | ||||
Interest expense
|
(7.1 | )% | (8.4 | )% | ||||
Amortization of deferred financial costs and debt discount
|
(0.8 | )% | (0.7 | )% | ||||
Loss on divestures, net
|
(1.9 | )% | — | |||||
Other income/(expense), net
|
0.3 | % | (0.1 | )% | ||||
|
|
|
|
|||||
Loss before income taxes
|
(15.2 | )% | (17.2 | )% | ||||
Provision for/(benefit from) income taxes
|
1.6 | % | (1.1 | )% | ||||
|
|
|
|
|||||
Net loss
|
(16.8 | )% | (16.2 | )% | ||||
|
|
|
|
Year Ended December 31,
|
||||||||||||||||
2020
|
2019
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Revenue:
|
||||||||||||||||
Event cloud
|
$ | 316,080 | $ | 379,216 | $ | (63,136 | ) | (16.6 | )% | |||||||
Hospitality cloud
|
182,620 | 188,388 | (5,768 | ) | (3.1 | )% | ||||||||||
|
|
|
|
|
|
|||||||||||
Total revenue
|
$ | 498,700 | $ | 567,604 | $ | (68,904 | ) | (12.1 | )% | |||||||
|
|
|
|
|
|
Year Ended December 31,
|
||||||||||||||||
2020
|
2019
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Cost of Revenue
|
$ | 176,250 | $ | 211,857 | $ | (35,607 | ) | (16.8 | )% |
Year Ended December 31,
|
||||||||||||||||
2020
|
2019
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Operating Expenses:
|
||||||||||||||||
Sales and marketing
|
$ | 128,388 | $ | 155,801 | $ | (27,413 | ) | (17.6 | )% | |||||||
Research and development
|
87,866 | 96,012 | (8,146 | ) | (8.5 | )% | ||||||||||
General and administrative
|
80,564 | 92,018 | (11,454 | ) | (12.4 | )% | ||||||||||
Intangible asset amortization, exclusive of amounts included in cost of revenue
|
53,844 | 57,685 | (3,841 | ) | (6.7 | )% | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total operating expenses
|
$ | 350,662 | $ | 401,516 | $ | (50,854 | ) | (12.7 | )% | |||||||
|
|
|
|
|
|
|
|
Year Ended
December 31, |
||||||||||||||||
2020
|
2019
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Interest expense
|
$ | (35,557 | ) | $ | (47,875 | ) | $ | 12,318 | 25.7 | % |
Year Ended
December 31,
|
||||||||||||||||
2020
|
2019
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Amortization of deferred financing costs and debt discount
|
$ | (3,798 | ) | $ | (3,836 | ) | $ | (38 | ) | (1.0 | )% |
Year Ended
December 31, |
||||||||||||||||
2020
|
2019
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Loss on divestitures, net
|
$ | (9,634 | ) | $ | — | $ | (9,634 | ) | (100.0 | )% |
Year Ended
December 31, |
||||||||||||||||
2020
|
2019
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Other income/(expense), net
|
$ | 1,333 | $ | (294 | ) | $ | 1,627 | 553.4 | % |
Year Ended
December 31,
|
||||||||||||||||
2020
|
2019
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Provision for/(benefit from) income taxes
|
$ | 7,865 | $ | (6,013 | ) | $ | 13,878 | 230.8 | % |
Year Ended December 31,
|
||||||||
2019
|
2018
|
|||||||
(in thousands)
|
||||||||
Consolidated Statement of Operations and Comprehensive Loss Data:
|
||||||||
Revenue:
|
||||||||
Event cloud
|
$ | 379,216 | $ | 325,219 | ||||
Hospitality cloud
|
188,388 | 154,796 | ||||||
|
|
|
|
|||||
Total revenue
|
567,604 | 480,015 | ||||||
Cost of revenue
|
211,857 | 165,181 | ||||||
|
|
|
|
|||||
Gross profit
|
355,747 | 314,834 | ||||||
Operating expenses:
|
||||||||
Sales and marketing
|
155,801 | 126,531 | ||||||
Research and development
|
96,012 | 78,447 | ||||||
General and administrative
|
92,018 | 76,155 | ||||||
Intangible asset amortization, exclusive of amounts included in cost of revenue
|
57,685 | 60,494 | ||||||
|
|
|
|
|||||
Total operating expenses
|
401,516 | 341,627 | ||||||
|
|
|
|
|||||
Loss from operations
|
(45,769 | ) | (26,793 | ) | ||||
Interest expense
|
(47,875 | ) | (42,259 | ) | ||||
Amortization of deferred financial costs and debt discount
|
(3,836 | ) | (3,704 | ) | ||||
Other expense, net
|
(294 | ) | (1,391 | ) | ||||
|
|
|
|
|||||
Loss before income taxes
|
(97,774 | ) | (74,147 | ) | ||||
Benefit from income taxes
|
(6,013 | ) | (20,107 | ) | ||||
|
|
|
|
|||||
Net loss
|
$ | (91,761 | ) | $ | (54,040 | ) | ||
|
|
|
|
Year Ended December 31,
|
||||||||
2019
|
2018
|
|||||||
Consolidated Statement of Operations and Comprehensive Loss Data:
|
||||||||
Revenue:
|
||||||||
Event cloud
|
66.8 | % | 67.8 | % | ||||
Hospitality cloud
|
33.2 | % | 32.2 | % | ||||
|
|
|
|
|||||
Total revenue
|
100.0 | % | 100.0 | % | ||||
Cost of revenue
|
37.3 | % | 34.4 | % | ||||
|
|
|
|
|||||
Gross profit
|
62.7 | % | 65.6 | % | ||||
Operating expenses:
|
||||||||
Sales and marketing
|
27.4 | % | 26.4 | % | ||||
Research and development
|
16.9 | % | 16.3 | % | ||||
General and administrative
|
16.2 | % | 15.9 | % | ||||
Intangible asset amortization, exclusive of amounts included in cost of revenue
|
10.2 | % | 12.6 | % | ||||
|
|
|
|
|||||
Total operating expenses
|
70.7 | % | 71.2 | % | ||||
|
|
|
|
|||||
Loss from operations
|
(8.1 | )% | (5.6 | )% | ||||
Interest expense
|
(8.4 | )% | (8.8 | )% | ||||
Amortization of deferred financial costs and debt discount
|
(0.7 | )% | (0.8 | )% | ||||
Other expense, net
|
(0.1 | )% | (0.3 | )% | ||||
|
|
|
|
|||||
Loss before income taxes
|
(17.2 | )% | (15.4 | )% | ||||
Benefit from income taxes
|
(1.1 | )% | (4.2 | )% | ||||
|
|
|
|
|||||
Net loss
|
(16.2 | )% | (11.3 | )% | ||||
|
|
|
|
Year Ended December 31,
|
||||||||||||||||
2019
|
2018
|
$ Change
|
% Change
|
|||||||||||||
Revenue:
|
||||||||||||||||
Event cloud
|
$ | 379,216 | $ | 325,219 | $ | 53,997 | 16.6 | % | ||||||||
Hospitality cloud
|
188,388 | 154,796 | 33.592 | 21.7 | % | |||||||||||
|
|
|
|
|
|
|||||||||||
Total revenue
|
$ | 567,604 | $ | 480,015 | $ | 87,589 | 18.2 | % | ||||||||
|
|
|
|
|
|
Year Ended December 31,
|
||||||||||||||||
2019
|
2018
|
$ Change
|
% Change
|
|||||||||||||
Cost of revenue
|
$ | 211,857 | $ | 165,181 | $ | 46,676 | 28.3 | % |
Year Ended December 31,
|
||||||||||||||||
2019
|
2018
|
$ Change
|
% Change
|
|||||||||||||
Operating Expenses:
|
||||||||||||||||
Sales and marketing
|
$ | 155,801 | $ | 126,531 | $ | 29,270 | 23.1 | % | ||||||||
Research and development
|
96,012 | 78,447 | 17,565 | 22.4 | % | |||||||||||
General and administrative
|
92.018 | 76,155 | 15,863 | 20.8 | % | |||||||||||
Intangible asset amortization, exclusive of amounts included in cost of revenue
|
57,685 | 60,494 | (2,809 | ) | (4.6 | )% | ||||||||||
|
|
|
|
|
|
|||||||||||
Total operating expenses
|
$ | 401,516 | $ | 341.627 | $ | 59,889 | 17.5 | % | ||||||||
|
|
|
|
|
|
Year Ended
December 31, |
||||||||||||||||
2019
|
2018
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Interest expense
|
$ | (47,875 | ) | $ | (42,259 | ) | $ | (5,616 | ) | (13.3 | )% |
Year Ended
December 31, |
||||||||||||||||
2019
|
2018
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Amortization of deferred financing costs and debt discount
|
$ | (3,836 | ) | $ | (3,704 | ) | $ | (132 | ) | (3.6 | )% |
Year Ended
December 31,
|
||||||||||||||||
2019
|
2018
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Other expense, net
|
$ | (294 | ) | $ | (1,391 | ) | $ | 1,097 | 78.9 | % |
Year Ended
December 31,
|
||||||||||||||||
2019
|
2018
|
$ Change
|
% Change
|
|||||||||||||
(in thousands)
|
||||||||||||||||
Benefit from income taxes
|
$ | (6,013 | ) | $ | (20,107 | ) | $ | 14,094 | 70.1 | % |
For the Three Months Ended
June 30, |
||||||||
2021
|
2020
|
|||||||
Adjusted EBITDA:
|
||||||||
Net loss
|
$ | (21,847 | ) | $ | (28,001 | ) | ||
Adjustments
|
||||||||
Interest expense
|
7,638 | 8,828 | ||||||
Amortization of deferred financing costs and debt discount
|
941 | 951 | ||||||
Loss on divestitures, net (1)
|
— | 9,634 | ||||||
Other income, net
|
(3,998 | ) | (20 | ) | ||||
Provision for
|
1,825 | 2,018 | ||||||
Depreciation
|
2,901 | 4,017 | ||||||
Amortization of software development costs
|
15,214 | 14,336 | ||||||
Intangible asset amortization
|
12,929 | 13,468 | ||||||
Stock-based compensation expense
|
7,815 | 4,831 | ||||||
Restructuring expense (2)
|
312 | 3,784 | ||||||
Impact of adjustments to acquired unearned revenue (3)
|
42 | — | ||||||
Cost related to acquisitions (4)
|
764 | 182 | ||||||
Other items (5)
|
289 | 2,238 | ||||||
|
|
|
|
|||||
Adjusted EBITDA
|
$ | 24,825 | $ | 36,266 | ||||
|
|
|
|
|||||
Adjusted EBITDA Margin:
|
||||||||
Revenue
|
$ | 122,814 | $ | 125,158 | ||||
Adjusted Revenue (6)
|
$ | 122,856 | $ | 125,158 | ||||
Net loss margin (6)
|
(17.8 | )% | (22.4 | )% | ||||
Adjusted EBITDA margin (6)
|
20.2 | % | 29.0 | % |
For the Six Months Ended June
30, |
||||||||
2021
|
2020
|
|||||||
Adjusted EBITDA:
|
||||||||
Net loss
|
$ | (38,408 | ) | $ | (52,708 | ) | ||
Adjustments
|
||||||||
Interest expense
|
15,171 | 19,544 | ||||||
Amortization of deferred financing costs and debt discount
|
1,884 | 1,904 | ||||||
Loss on divestitures, net (1)
|
— | 9,634 | ||||||
Other income, net
|
(4,271 | ) | (1,457 | ) | ||||
Provision for income taxes
|
3,325 | 4,222 | ||||||
Depreciation
|
5,985 | 8,268 | ||||||
Amortization of software development costs
|
30,409 | 28,594 | ||||||
Intangible asset amortization
|
25,964 | 26,925 | ||||||
Stock-based compensation expense
|
8,423 | 9,678 | ||||||
Restructuring expense (2)
|
566 | 3,933 | ||||||
Impact of adjustments to acquired unearned revenue (3)
|
42 | 374 | ||||||
Cost related to acquisitions (4)
|
1,186 | 676 | ||||||
Other items (5)
|
(2,802 | ) | 3,279 | |||||
|
|
|
|
|||||
Adjusted EBITDA
|
47,474 | 62,866 | ||||||
|
|
|
|
|||||
Adjusted EBITDA Margin:
|
||||||||
Revenue
|
$ | 240,101 | $ | 264,708 | ||||
Adjusted Revenue (6)
|
$ | 240,143 | $ | 265,082 | ||||
Net loss margin (6)
|
(16.0 | )% | (19.9 | )% | ||||
Adjusted EBITDA margin (6)
|
19.8 | % | 23.7 | % |
For the Year Ended December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Adjusted EBITDA:
|
||||||||||||
Net loss
|
$ | (83,733 | ) | $ | (91,761 | ) | $ | (54,040 | ) | |||
Adjustments
|
||||||||||||
Interest expense
|
35,557 | 47,875 | 42,259 | |||||||||
Amortization of deferred financing costs and debt discount
|
3,798 | 3,836 | 3,704 | |||||||||
Loss on divestitures, net (1)
|
9,634 | — | — | |||||||||
Other income/(expense), net
|
(1,333 | ) | 294 | 1,391 | ||||||||
Provision for/(benefit from) income taxes
|
7,865 | (6,013 | ) | (20,107 | ) | |||||||
Depreciation
|
15,141 | 16,163 | 14,664 | |||||||||
Amortization of software development costs
|
58,606 | 48,572 | 40,250 | |||||||||
Intangible asset amortization
|
53,844 | 55,815 | 53,900 | |||||||||
Stock-based compensation expense
|
17,695 | 18,833 | 17,911 | |||||||||
Restructuring expense (2)
|
7,400 | 3,230 | 3,538 | |||||||||
Impact of adjustments to acquired unearned revenue (3)
|
374 | 4,876 | 2,481 | |||||||||
Cost related to acquisitions (4)
|
877 | 4,164 | 2,914 | |||||||||
Other items (5)
|
3,853 | 7,096 | 2,515 | |||||||||
|
|
|
|
|
|
|||||||
Adjusted EBITDA
|
$ | 129,578 | $ | 112,980 | $ | 111,380 | ||||||
|
|
|
|
|
|
|||||||
Adjusted EBITDA Margin:
|
||||||||||||
Revenue
|
$ | 498,700 | $ | 567,604 | $ | 480,015 | ||||||
Adjusted Revenue (6)
|
$ | 499,075 | $ | 572,481 | $ | 482,496 | ||||||
Net loss margin (6)
|
(16.8 | )% | (16.2 | )% | (11.3 | )% | ||||||
Adjusted EBITDA margin (6)
|
26.0 | % | 19.7 | % | 23.1 | % |
(1) |
Loss on divestitures, net is the result of the divestiture of Kapow Events in June 2020.
|
(2) |
Restructuring expense includes costs associated with severance related to the global reduction in force that took place in May 2020 in response to the global COVID-19 pandemic, severance to employees of acquired entities, retention bonuses to employees of acquired entities, costs to discontinue use of a back-office system and closing of office space.
|
(3) |
Represents the impact of adjustments to acquired unearned revenue relating to services billed by an acquired company, including QuickMobile, Social Tables, DoubleDutch and Wedding Spot, prior to our acquisition of that company. These adjustments represent the difference between the revenue recognized based on management’s estimate of fair value of acquired unearned revenue and the receipts billed prior to the acquisition, less revenue recognized prior to the acquisition.
|
(4) |
Represents costs incurred in association with acquisition activity, including due diligence and post- acquisition earn out payments.
|
(5) |
Includes other costs associated with litigation, private equity management fees, and credit facility fees, net of the gain from government subsidies related to global COVID-19 pandemic.
|
(6) |
Net loss margin represents net loss divided by revenue and Adjusted EBITDA margin represents Adjusted EBITDA divided by revenue adjusted for the impact of adjustments to acquired unearned revenue.
|
For the Six Months
Ended June 30, |
||||||||
2021
|
2020
|
|||||||
(in thousands)
|
||||||||
Net cash provided by operating activities
|
$ | 95,598 | $ | 46,819 | ||||
Net cash used in investing activities
|
(48,274 | ) | (32,015 | ) | ||||
Net cash (used in)/provided by financing activities
|
(16,902 | ) | 35,594 | |||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
(744 | ) | (3,301 | ) | ||||
|
|
|
|
|||||
Change in cash, cash equivalents, and restricted cash
|
29,678 | 47,097 | ||||||
Cash, cash equivalents, and restricted cash at beginning of year
|
65,470 | 72,271 | ||||||
|
|
|
|
|||||
Cash, cash equivalents, and restricted cash at end of year
|
$ | 95,148 | $ | 119,818 | ||||
|
|
|
|
|||||
Cash paid for interest
|
$ | 15,181 | $ | 19,531 |
For the Year Ended December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
(in thousands)
|
||||||||||||
Net cash provided by operating activities
|
$ | 29,099 | $ | 48,029 | $ | 49,773 | ||||||
Net cash used in investing activities
|
(42,571 | ) | (73,754 | ) | (177,769 | ) | ||||||
Net cash provided by financing activities
|
5,528 | 20,352 | 86,202 | |||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
693 | 255 | 1,029 | |||||||||
|
|
|
|
|
|
|||||||
Change in cash, cash equivalents, and restricted cash
|
(7,251 | ) | (5,118 | ) | (40,765 | ) | ||||||
Cash, cash equivalents, and restricted cash at beginning of year
|
72,721 | 77,839 | 118,604 | |||||||||
|
|
|
|
|
|
|||||||
Cash, cash equivalents, and restricted cash at end of year
|
$ | 65,470 | $ | 72,721 | $ | 77,839 | ||||||
|
|
|
|
|
|
|||||||
Cash paid for interest
|
$ | 35,552 | $ | 47,856 | $ | 41,905 |
• |
contemporaneous independent valuations performed at periodic intervals by an unrelated third-party valuation specialist;
|
• |
the nature of the business and its history since inception;
|
• |
the economic outlook in general and the condition and outlook of the specific industry;
|
• |
the book value of the stock and the financial condition of the business;
|
• |
the operating and financial performance and forecast;
|
• |
whether or not we have goodwill or other intangible values;
|
• |
marketability of the common stock;
|
• |
the hiring of key personnel;
|
• |
any corporate or asset acquisitions, or divestitures;
|
• |
present value of estimated future cash flows;
|
• |
the likelihood of achieving a liquidity event for the shares of common stock underlying these stock options, such as an initial public offering or sale of the company, given prevailing market condition and the nature and history of the business;
|
• |
illiquidity of stock-based awards involving securities in a private company;
|
• |
the market performance of comparable publicly traded technology companies; and
|
• |
the U.S. and global capital market conditions.
|
• |
Rajeev Aggarwal, Founder, Chief Executive Officer and Director;
|
• |
Charles Ghoorah, Co-founder, President of Worldwide Sales and Marketing;
|
• |
David Quattrone, Co-founder, Chief Technology Officer;
|
• |
Lawrence Samuelson, Senior Vice President, General Counsel and Corporate Secretary; and
|
• |
William Newman, III, Senior Vice President and Chief Financial Officer.
|
• |
attract and retain talented and experienced executives in our industry;
|
• |
reward executives whose knowledge, skills, and performance are critical to our success;
|
• |
align the interests of our executive officers and stockholders by motivating executive officers to increase stockholder value and rewarding executive officers when stockholder value increases;
|
• |
ensure fairness among the executive management team by recognizing the (i) function and subject matter expertise each executive officer performs and (ii) contributions each executive makes to our success;
|
• |
foster a shared commitment among executives by aligning their individual goals with the goals of the executive management team and our company; and
|
• |
compensate our executives in a manner that incentivizes them to manage our business to meet our long-range objectives.
|
• |
base salary;
|
• |
annual cash incentive awards linked to overall corporate and individual performance;
|
• |
periodic grants of long-term equity-based compensation, such as options;
|
• |
other executive benefits and perquisites; and
|
• |
employment agreements, which contain termination benefits.
|
Name
|
Incentive
Target (%) |
Incentive
Target ($) |
Bonus Amount
Earned ($) |
|||||||||
Rajeev Aggarwal
|
35.6 | 162,000 | 149,850 | |||||||||
Charles Ghoorah
|
36.0 | 129,780 | 121,344 | |||||||||
David Quattrone
|
35.1 | 160,680 | 151,039 | |||||||||
Lawrence Samuelson
|
29.0 | 92,700 | 87,138 | |||||||||
William Newman, III
|
27.3 | 78,000 | 72,150 |
• |
health insurance;
|
• |
vacation, personal holidays and sick days;
|
• |
life insurance and supplemental life insurance;
|
• |
short-term and long-term disability; and
|
• |
a 401(k) plan with matching contributions.
|
Name and Principal
Position |
Year
|
Salary
($)(1) |
Bonus
($) |
Option
Awards ($) |
Non-Equity
Incentive Plan Compensation ($) |
Change in
Pension Value and Nonqualified Deferred Compensation Earnings ($) |
All Other
Compensation ($)(2) |
Total
|
||||||||||||||||||||||
Rajeev Aggarwal,
Chief Executive Officer and Director
|
2020 | 235,454 | 149,850 | (4) | 3,500 | $ | 338,804 | |||||||||||||||||||||||
Charles Ghoorah, President of Worldwide Sales and Marketing
|
2020 | 302,820 | 64,890 | (3) | 121,344 | (4) | 3,500 | $ | 721,751 | |||||||||||||||||||||
229,197 | (5) | |||||||||||||||||||||||||||||
David Quattrone, Chief Technology Officer
|
2020 | 411,588 | 80,340 | (3) | 151,039 | (4) | 3,500 | $ | 646,467 | |||||||||||||||||||||
Lawrence Samuelson, SVP, General Counsel & Corporate Secretary
|
2020 | 297,747 | 46,350 | (3) | 87,138 | (4) | 3,500 | $ | 434,735 | |||||||||||||||||||||
William Newman, III,
SVP & Chief Financial Officer
|
2020 | 268,840 | 39,000 | (3) | 72,150 | (4) | 1,072 | $ | 381,062 |
(1) |
The amounts reported in the “
Salary
|
(2) |
The amounts reported in the All Other Compensation column reflect Cvent matches under Cvent’s 401(k) plan for each of the named executive officers.
|
(3) |
The amounts reported in the Bonus column reflect special retention bonus payment amounts, which were payable to all employees, including the named executive officers, in 2020.
|
(4) |
The amounts reported in the Non-Equity Incentive Compensation column reflect amounts earned in 2020, which were paid during 2021, under the management incentive plan based on the achievement of company goals and individual objectives. See “
—Non-Equity Incentive Compensation—Performance Based Annual Cash Incentive Awards”
“—Grants of Plan-Based Awards During 2020
|
(5) |
The amount reported in the Non-Equity Incentive Compensation column for Mr. Ghoorah reflects the actual amount earned by Mr. Ghoorah under Cvent’s Sales Incentive Compensation Plan. See “
—Non-Equity Incentive Compensation—Commissions
|
Name
|
Grant Date
|
Estimated Future
Payouts Under Non-Equity Incentive Plan Awards |
||||||||||
Target
($) |
Maximum
($) |
|||||||||||
Rajeev Aggarwal
|
— | 162,000 | (1) | 192,375 | (4) | |||||||
Charles Ghoorah
|
— | 129,780 | (1) | 150,869 | (4) | |||||||
— | 229,265 | (2) | — | |||||||||
David Quattrone
|
— | 160,680 | (1) |
|
184,782
|
(4)
|
||||||
Lawrence Samuelson
|
— | 92,700 | (1) | 106,605 | (4) | |||||||
William Newman, III
|
— | 78,000 | (1) | 92,625 | (4) | |||||||
11/13/2020 | 120,000 | (3) | — |
(1) |
The amounts reported in these columns reflect the target annual performance-based cash bonus opportunity for each of our named executive officers under our management incentive plan for fiscal year 2020, the terms of which are summarized under “
Annual Bonus
—Non-Equity Incentive Compensation—Performance Based Annual Cash Incentive Awards
—Non-Equity Incentive Compensation—Performance Based Annual Cash Incentive Awards
|
(2) |
Mr. Ghoorah is eligible for commissions pursuant to Cvent’s Sales Incentive Compensation Plan. Mr. Ghoorah’s earned $229,265 upon achievement of 100% of his annual goals for the year ended December 31, 2020. See “
—Non-Equity Incentive Compensation—Commissions
|
(3) |
On November 13, 2020, Mr. Newman was granted an Incentive with a target amount equal to $120,000. See “
—Long-Term Incentive Compensation—Cash-Incentive Compensation
|
(4) |
Depending upon corporate performance, an executive officer may receive up to 125% of his or her target corporate performance bonus amount. Depending upon the individual’s performance, an executive officer may receive up to 100% of his or her target individual performance bonus amount. See “—
Non-Equity Incentive Compensation—Performance Based Annual Cash Incentive Awards.
|
Option Awards (1)
|
||||||||||||||||
Name and Principal Position
|
Number of Securities
Underlying Unexercised Options (#) Exercisable |
Number of Securities
Underlying Unexercised Options (#) Unexercisable |
Option
Exercise Price ($) |
Option
Expiration Date |
||||||||||||
Rajeev Aggarwal,
Chief Executive Officer and Director
|
20,012 | (2) (3) | — | 1,664.02 | 5/26/2027 | |||||||||||
300 | — | 1,664.02 | 8/29/2027 | |||||||||||||
Charles Ghoorah,
President of Worldwide Sales and Marketing
|
10,787 | (2) (4) | — | 1,664.02 | 5/26/2027 | |||||||||||
30 | — | 1,664.02 | 8/29/2027 |
Option Awards (1)
|
||||||||||||||||
Name and Principal Position
|
Number of Securities
Underlying Unexercised Options (#) Exercisable |
Number of Securities
Underlying Unexercised Options (#) Unexercisable |
Option
Exercise Price ($) |
Option
Expiration Date |
||||||||||||
David Quattrone,
Chief Technology Officer
|
10,787 | (2) (5) | — | 1,664.02 | 5/26/2027 | |||||||||||
30 | — | 1,664.02 | 8/29/2027 | |||||||||||||
Lawrence Samuelson,
SVP, General Counsel & Corporate Secretary
|
1,683 | (2) | — | 1,664.02 | 5/26/2027 | |||||||||||
William Newman, III,
SVP & Chief Financial Officer
|
721 | (2) | — | 1,664.02 | 5/26/2027 | |||||||||||
58 | 59 | (6) | 2,172.01 | 11/15/2028 | ||||||||||||
40 | (7) | 2,451.67 | 11/15/2029 |
(1) |
For each named executive officer, the Options disclosed in this table are subject to service-based vesting requirements. See “
—Potential Payments upon a Termination or Change in Control
|
(2) |
The Options disclosed in this column are subject to service-based vesting requirements as follows: 25% of the time-vesting Options vested on the first anniversary of the specified vesting commencement date and the remaining 75% vested in equal installments at the end of each full three month calendar month period thereafter, subject to the Option holder’s continuous service with us through each applicable vesting date. All of the Options held by the named executive officer pursuant to this award were fully vested as of December 31, 2020.
|
(3) |
In calendar year 2019, Mr. Aggarwal exercised 15,745 previously granted and vested Options and holds the corresponding number of shares of our common stock and the remaining 20,012 fully vested Options.
|
(4) |
In calendar year 2019, Mr. Ghoorah transferred 1,798 fully vested Options to his family trust. The remaining Options are held individually by Mr. Ghoorah.
|
(5) |
In calendar year 2019, Mr. Quattrone transferred 1,500 fully vested Options to his family trust. The remaining Options are held individually by Mr. Quattrone.
|
(6) |
On November 15, 2018, Mr. Newman was granted 117 Options subject to service-based vesting requirements as follows: 31.25% of the Options vested on February 15, 2020 and the remaining 68.75% will vest in equal installments at the end of each full three month calendar period thereafter, subject to Mr. Newman’s continuous service with us through each applicable vesting date.
|
(7) |
On November 15, 2019, Mr. Newman was granted 40 Options subject to service-based vesting requirements as follows: 50% of the Options vested on March 1, 2021 and the remaining 50% will vest on March 1, 2022, subject to Mr. Newman’s continuous service with us through each applicable vesting date. None of the Options held by Mr. Newman pursuant to this award were fully vested as of December 31, 2020.
|
Payable Upon a Termination Without Cause or
Resignation for Good Reason |
Payable Upon a Change in
Control |
|||||||||||||||||||
Name and Principal Position
|
Continued Base
Salary ($) (1) |
Annual Bonus
for Year of Termination ($) (2) |
Continued
Health Benefits ($) (3) |
Value of
Accelerated Equity Awards ($) (4) |
Value of
LTIP Incentives ($) |
|||||||||||||||
Rajeev Aggarwal,
Chief Executive Officer and Director
|
455,000 | 149,850 |
|
20,149
|
|
— | — | |||||||||||||
Charles Ghoorah,
President of Worldwide Sales and Marketing
|
360,500 | 121,344 | 19,209 | — | — | |||||||||||||||
David Quattrone,
Chief Technology Officer
|
457,320 | 151,039 | 19,932 | — | — | |||||||||||||||
Lawrence Samuelson,
SVP, General Counsel & Corporate Secretary
|
319,300 | 87,138 | 8,922 | — | — | |||||||||||||||
William Newman, III,
SVP & Chief Financial Officer
|
286,000 | 72,150 | 3,048 | 7,728 (5 | ) | 120,000 (6 | ) |
(1) |
For each named executive officer, the amounts disclosed in this column represent 12 months of base salary continuation as provided pursuant to his employment agreement upon a termination by Cvent without cause or by the named executive officer with good reason. For Messrs. Samuelson and Newman, this assumes that no remuneration was received by the named executive officer between the date that is 6 months following termination and the date that is 12 months following termination such that the base salary continuation would be subject to offset. See “
—Termination and Change in Control Arrangements—Employment Agreements
|
(2) |
For each named executive officer, the amounts disclosed in this column represent amounts earned under the management incentive plan based on the actual achievement of company goals and individual objectives for 2020 as provided pursuant to his employment agreement upon a termination by Cvent without cause or by the named executive officer with good reason. For each named executive officer, this assumes that the board of directors and CEO approved payment of the bonus based on actual performance. Assuming termination occurred on December 31, 2020, no proration has been applied. See “
—Termination and Change in Control
Arrangements—Employment Agreements
|
(3) |
The amounts disclosed in this column represent health insurance premium reimbursements for a period of 12 months for Messrs. Aggarwal, Ghoorah and Quattrone, and for a period of 6 months for Messrs. Samuelson and Newman. See “—
Termination and Change in Control Arrangements—Employment Agreements
|
(4) |
For each named executive officer, the amounts disclosed in this column represent the value of any outstanding unvested Options subject to acceleration upon a change in control of Cvent, which is the “spread” based on the board of directors approved independent valuation price per share as of December 31, 2020 of $2303.66 and the exercise price of the Options.
|
(5) |
On November 15, 2018, Mr. Newman was granted 117 Options with a strike price of $2,172.01. The Options are subject to service-based vesting requirements and any outstanding unvested Options will accelerate and vest upon a change in control of Cvent. Of the Options, 59 were outstanding and subject to acceleration upon a change in control as of December 31, 2020. See “
—Termination and Change in Control Arrangements—Stock Options.
|
(6) |
On November 13, 2020, Mr. Newman was granted an Incentive under the LTIP that will vest and be payable upon a change in control of Cvent where total equity return multiple is at least 2x. The amount disclosed in this column assumes 100% of the Incentive was payable upon a total equity return multiple of 2x. See “
—Termination and Change in Control Arrangements—LTIP.
|
Name
|
Fees Earned or
Paid in Cash ($) |
Stock
Awards ($) |
Total
($) |
|||||||||
Sanju Bansal
|
— | — | (1) | — |
(1) |
On November 12, 2018, Mr. Bansal received 156 Options. Of the Options, 50% vested on the first anniversary of August 9, 2018, and the remaining 50% vest in equal installments at the end of each full three month calendar month period thereafter. In calendar year 2019, Mr. Bansal exercised 87 previously granted and vested Options and held the corresponding number of shares of our common stock as of December 31, 2020. As of December 31, 2020, Mr. Bansal held 69 unvested Options from this grant, which remain subject to Mr. Bansal’s continuous service with us through each applicable vesting date. On April 29, 2019, Mr. Bansal received 45 Options. Of the Options, 25% vested on the first anniversary of March 1, 2019 and the remaining 75% will vest in equal installments at the end of each full three month calendar month period thereafter, subject to Mr. Bansal’s continuous service with us through each applicable vesting date. Of the Options granted to Mr. Basal in 2019, 19 were vested as of December 31, 2020. Mr. Bansal did not receive Options in 2020.
|
Name
|
Age
|
Position
|
||
Rajeev K. Aggarwal | 52 | Founder, Chief Executive Officer and Director Nominee | ||
Charles Ghoorah | 52 | Co-founder, President of Worldwide Sales and Marketing | ||
David Quattrone | 48 | Co-founder, Chief Technology Officer | ||
William J. Newman, III | 46 | Senior Vice President and Chief Financial Officer | ||
Lawrence J. Samuelson | 51 | Senior Vice President, General Counsel and Corporate Secretary | ||
Betty Hung | 51 | Director Nominee | ||
Maneet Saroya | 41 | Director Nominee |
• |
the company has a board that is composed of a majority of “independent directors,” as defined under the rules of such exchange;
|
• |
the company has a compensation committee that is composed entirely of independent directors; and
|
• |
the company has a nominating and corporate governance committee that is composed entirely of independent directors.
|
Board Member
|
Audit Committee
|
Compensation and Nominating
Committee |
||
• |
appointing, approving the compensation of, and assessing the qualifications, performance and independence of our independent registered public accounting firm;
|
• |
pre-approving audit and permissible non-audit services, and the terms of such services, to be provided by our independent registered public accounting firm;
|
• |
review our policies on risk assessment and risk management;
|
• |
reviewing and discussing with management and the independent registered public accounting firm our annual and quarterly financial statements and related disclosures as well as critical accounting policies and practices used by us;
|
• |
reviewing the adequacy of our internal control over financial reporting;
|
• |
establishing policies and procedures for the receipt and retention of accounting-related complaints and concerns;
|
• |
recommending, based upon the Audit Committee’s review and discussions with management and the independent registered public accounting firm, whether our audited financial statements shall be included in our Annual Report on Form 10-K;
|
• |
monitoring our compliance with legal and regulatory requirements as they relate to our financial statements and accounting matters;
|
• |
preparing the Audit Committee report required by the rules of the SEC to be included in our annual proxy statement;
|
• |
reviewing all related party transactions for potential conflict of interest situations and approving all such transactions; and
|
• |
reviewing and discussing with management and our independent registered public accounting firm our earnings releases.
|
• |
annually reviewing and approving corporate goals and objectives relevant to the compensation of our chief executive officer;
|
• |
evaluating the performance of our chief executive officer in light of such corporate goals and objectives and determining and approving the compensation of our chief executive officer;
|
• |
reviewing and approving the compensation of our other executive officers;
|
• |
appointing, compensating and overseeing the work of any compensation consultant, legal counsel or other advisor retained by the Compensation and Nominating Committee;
|
• |
conducting the independence assessment outlined in the Nasdaq rules with respect to any compensation consultant, legal counsel or other advisor retained by the Compensation and Nominating Committee;
|
• |
annually reviewing and reassessing the adequacy of the committee charter in its compliance with the listing requirements of the Nasdaq;
|
• |
reviewing and establishing our overall management compensation, philosophy and policy;
|
• |
overseeing and administering our compensation and similar plans;
|
• |
reviewing and making recommendations to the New Cvent Board with respect to director compensation;
|
• |
reviewing and discussing with management the compensation discussion and analysis to be included in our annual proxy statement or Annual Report on Form 10-K;
|
• |
developing and recommending to the New Cvent Board criteria for board and committee membership;
|
• |
identifying and recommending to the New Cvent Board the persons to be nominated for election as directors and to each of our board committees;
|
• |
developing and recommending to the New Cvent Board best practices and corporate governance principles;
|
• |
developing and recommending to the New Cvent Board a set of corporate governance guidelines;
|
• |
reviewing and recommending to the New Cvent Board the functions, duties and compositions of the committees of the Board;
|
• |
reviewing and making recommendations to the New Cvent Board with respect to Environmental, Social and Governance (“
ESG
”) strategy, policies and procedures (including the Sustainability Policy) and emergent ESG-related trends and issues (including climate change and human capital management) in connection with New Cvent’s business activities, to encourage long-term sustainable performance, manage ESG risks, and effectively communicate ESG initiatives to stakeholders, including ESG ratings agencies;
|
• |
reviewing and discussing with management ESG reports by management and ESG efforts that management has implemented to monitor and address New Cvent’s impact on ESG issues; and
|
• |
reviewing and assessing shareholder proposals submitted to New Cvent for inclusion in New Cvent’s proxy statement, including an assessment of the relevance and significance of the proposal.
|
• |
each person known by Dragoneer to be the beneficial owner of more than 5% of Dragoneer’s outstanding ordinary shares on the record date;
|
• |
each person known by Dragoneer who may become beneficial owner of more than 5% of outstanding New Cvent Common Stock immediately following the Business Combination;
|
• |
each of Dragoneer’s current executive officers and directors;
|
• |
each person who will become an executive officer or a director of New Cvent upon consummation of the Business Combination;
|
• |
all of Dragoneer’s current executive officers and directors as a group; and
|
• |
all of New Cvent’s executive officers and directors as a group after the consummation of the Business Combination.
|
After Business Combination
|
||||||||||||||||||||||||
Prior to
Business Combination(2) |
Assuming No
Redemptions(3) |
Assuming
Maximum Redemptions(4) |
||||||||||||||||||||||
Name and Address of Beneficial Owners(1)
|
Number of
Shares |
%
|
Number
of Shares |
%
|
Number
of Shares |
%
|
||||||||||||||||||
Directors and officers prior to the Business Combination:
|
||||||||||||||||||||||||
Marc Stad(5)
|
6,600,000 | |||||||||||||||||||||||
Pat Robertson(6)
|
— | |||||||||||||||||||||||
Sarah J. Friar
|
75,000 | |||||||||||||||||||||||
David D. Ossip
|
75,000 | |||||||||||||||||||||||
Gokul Rajaram
|
75,000 | |||||||||||||||||||||||
Jay Simons
|
75,000 | |||||||||||||||||||||||
All directors and officers prior to the Business Combination (seven persons)
|
6,900,000 |
After Business Combination
|
||||||||||||||||||||||||
Prior to
Business Combination(2) |
Assuming No
Redemptions(3) |
Assuming
Maximum Redemptions(4) |
||||||||||||||||||||||
Name and Address of Beneficial Owners(1)
|
Number of
Shares |
%
|
Number of
Shares |
%
|
Number of
Shares |
%
|
||||||||||||||||||
Directors and named executive officers after the Business Combination:
|
||||||||||||||||||||||||
Rajeev Aggarwal
|
||||||||||||||||||||||||
Charles Ghoorah
|
||||||||||||||||||||||||
David Quattrone
|
||||||||||||||||||||||||
Lawrence Samuelson
|
||||||||||||||||||||||||
William Newman
|
||||||||||||||||||||||||
Betty Hung
|
||||||||||||||||||||||||
Maneet Saroya
|
||||||||||||||||||||||||
All directors and officers after the Business Combination as a group ([
] persons)
|
||||||||||||||||||||||||
Five Percent Holders:
|
||||||||||||||||||||||||
Vista Funds(7)
|
||||||||||||||||||||||||
Sponsor
|
(1) |
Unless otherwise noted, the business address of each of the directors and officers prior to the Business Combination is One Letterman Drive, Building D Suite M500, San Francisco, CA 94129 and the business address of each of the directors and officers after the Business Combination is 1765 Greensboro Station Place, 7th Floor, Tysons, VA 22201.
|
(2) |
Prior to the Business Combination, the percentage of beneficial ownership of Dragoneer on the record date is calculated based on (i) 27,600,000 Class A ordinary shares and (ii) 6,900,000 Class B ordinary shares, in each case, outstanding as of such date.
|
(3) |
The expected beneficial ownership of New Cvent immediately upon consummation of the Business Combination, assuming no holders of public shares exercise their redemption rights in connection therewith and the Closing occurs on [●], is based on [●] shares of New Cvent Common Stock outstanding as of such date, and consists of (i) 27,600,000 Class A ordinary shares that will convert into a like number of shares of New Cvent Common Stock, (ii) 6,900,000 Class B ordinary shares that will convert into a like number of shares of New Cvent Common Stock, (iii) 416,351,853 shares of New Cvent Common Stock that will be issued to the holders of shares of common stock of Cvent, (iv) 5,000,000 Class A ordinary shares that will be issued in connection with the forward purchase agreement substantially concurrently with the consummation of the Business Combination, (v) 47,500,000 shares of New Cvent Common Stock that will be issued in the PIPE Financing, (vi) 752,000 private placement shares held by Sponsor and (vii) 200,000 Class A ordinary shares that will be issued upon conversion of the principal amount of a working capital loan provided by Sponsor.
|
(4) |
The expected beneficial ownership of New Cvent immediately upon consummation of the Business Combination, assuming all holders of Dragoneer’s public shares exercise their redemption rights in connection therewith and the Closing occurs on [●], is based on [●] shares of New Cvent Common Stock outstanding as of such date, and consists of (i) 6,900,000 Class B ordinary shares that will convert into a like number of shares of New Cvent Common Stock, (ii) 416,351,853 shares of New Cvent Common Stock that will be issued to the holders of shares of common stock of Cvent, (iii) 5,000,000 Class A ordinary shares that will be issued in connection with the forward purchase agreement immediately prior to the closing of the Business Combination and (iv) 47,500,000 shares of New Cvent Common Stock that will be issued in the PIPE Financing, (v) 752,000 private placement shares held by Sponsor and (vi) 200,000 Class A ordinary shares that will be issued upon conversion of the principal amount of a working capital loan provided by Sponsor.
|
(5) |
Prior to the Business Combination, includes 6,600,000 Class B ordinary shares held in the name of Sponsor. Prior to the Business Combination, does not include 200,000 Class A ordinary shares that will be issued upon conversion of the principal amount of a working capital loan provided by Sponsor. Immediately upon consummation of the Business Combination, includes 5,000,000 Class A ordinary shares that will be issued in connection with the Forward Purchase Agreement to the Forward Purchaser, an affiliate of Sponsor, immediately prior to the closing of the Business Combination. Immediately upon consummation of the Business Combination, does not include 200,000 Class A ordinary shares that will be issued upon conversion of the principal amount of a working capital loan provided by Sponsor. Marc Stad is the sole member of the ultimate general partner of Dragoneer Interco Holdings LP, which is the ultimate manager of Sponsor. Mr. Stad is the sole member of the ultimate general partner of Dragoneer Global GP II, LLC, which is the general partner of Dragoneer Global Fund II, L.P., which is the manager of Dragoneer Funding II LLC. As a result of the foregoing relationships, Mr. Stad may be deemed to beneficially own securities held by Sponsor and Dragoneer Funding II LLC.
|
(6) |
Does not include any shares indirectly owned by this individual as a result of his membership interest in Sponsor.
|
(7) |
Represents [•] shares held directly by Vista Equity Partners Fund VI, L.P., or VEPF VI, [•] shares held directly by Vista Equity Partners Fund VI-A, L.P., or VEPF VI-A, and [•] shares held directly by VEPF VI FAF, L.P., or VEPF VI FAF. Vista Equity Partners Fund VI GP, L.P., or VEPF VI GP, is the sole general partner of each of VEPF VI, VEPF VI-A and VEPF VI FAF. VEPF VI GP’s sole general partner is VEPF VI GP, Ltd., or VEPF VI UGP. Robert F. Smith is the Sole Director of VEPF VI UGP, as well as one of its 11 Members. VEPF Management, L.P., or VEPF Management, is the sole management company of each of VEPF VI, VEPF VI-A and VEPF VI FAF. VEPF Management’s sole general partner is VEP Group, LLC, or VEP Group, and VEPF Management’s sole limited partner is Vista Equity Partners Management, LLC, or VEPM. VEP Group is the Senior Managing Member of VEPM.
|
• |
the related person’s relationship to us and interest in the transaction;
|
• |
the material facts of the proposed transaction, including the proposed aggregate value of the transaction;
|
• |
the impact on a director’s independence in the event the related person is a director or an immediate family member of the director;
|
• |
the benefits to Cvent of the proposed transaction;
|
• |
if applicable, the availability of other sources of comparable products or services; and
|
• |
an assessment of whether the proposed transaction is on terms that are comparable to the terms available to an unrelated third party or to employees generally.
|
• |
the amounts involved exceeded or will exceed $120,000; and
|
• |
any of its directors, executive officers, or holders of more than 5% of Company capital stock, or any member of the immediate family of, or person sharing the household with, the foregoing persons, had or will have a direct or indirect material interest.
|
Delaware
|
Cayman Islands
|
|||
Stockholder/Shareholder Approval of Business Combinations
|
Mergers generally require approval of a majority of all outstanding shares.
Mergers in which less than 20% of the acquirer’s stock is issued generally do not require acquirer stockholder approval.
Mergers in which one corporation owns 90% or more of a second corporation may be completed without the vote of the second corporation’s board of directors or stockholders.
|
Mergers require a special resolution, and any other authorization as may be specified in the relevant articles of association. Parties holding certain security interests in the constituent companies must also consent.
All mergers (other than parent/subsidiary mergers) require shareholder approval—there is no exception for smaller mergers.
Where a bidder has acquired 90% or more of the shares in a Cayman Islands company, it can compel the acquisition of the shares of the remaining shareholders and thereby become the sole shareholder.
A Cayman Islands company may also be acquired through a .
|
Delaware
|
Cayman Islands
|
|||
“scheme of arrangement” sanctioned by a Cayman Islands court and approved by 50%+1 in number and 75% in value of shareholders in attendance and voting at a shareholders’ meeting | ||||
Stockholder/Shareholder Votes for Routine Matters
|
Generally, approval of routine corporate matters that are put to a stockholder vote require the affirmative vote of the majority of shares present in person or represented by proxy at the meeting and entitled to vote on the subject matter. | Under Cayman Islands law and the Existing Governing Documents, routine corporate matters may be approved by an ordinary resolution (being a resolution passed by a simple majority of the shareholders as being entitled to do so). | ||
Appraisal Rights
|
Generally a stockholder of a publicly traded corporation does not have appraisal rights in connection with a merger. | Minority shareholders that dissent from a Cayman Islands statutory merger are entitled to be paid the fair market value of their shares, which if necessary may ultimately be determined by the court. | ||
Inspection of Books and Records
|
Any stockholder may inspect the corporation’s books and records for a proper purpose during the usual hours for business. | Shareholders generally do not have any rights to inspect or obtain copies of the register of shareholders or other corporate records of a company. | ||
Stockholder/Shareholder Lawsuits
|
A stockholder may bring a derivative suit subject to procedural requirements (including adopting Delaware as the exclusive forum as per Governing Documents Proposal E). |
In the Cayman Islands, the decision to institute proceedings on behalf of a company is generally taken by the company’s board of directors. A shareholder may be entitled to bring a derivative action on behalf of the company, but only in certain limited circumstances.
|
||
Fiduciary Duties of Directors
|
Directors must exercise a duty of care and duty of loyalty and good faith to the company and its stockholders. |
A director owes fiduciary duties to a company, including to exercise loyalty, honesty and good faith to the company as a whole.
In addition to fiduciary duties, directors owe a duty of care, diligence and skill.
Such duties are owed to the company but may be owed direct to creditors or shareholders in certain limited circumstances.
|
Delaware
|
Cayman Islands
|
|||
Indemnification of Directors and Officers
|
A corporation is generally permitted to indemnify its directors and officers acting in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation. | A Cayman Islands company generally may indemnify its directors or officers except with regard to fraud or willful default. | ||
Limited Liability of Directors
|
Permits limiting or eliminating the monetary liability of a director to a corporation or its stockholders, except with regard to breaches of duty of loyalty, intentional misconduct, unlawful repurchases or dividends, or improper personal benefit. | Liability of directors may be unlimited, except with regard to their own fraud or willful default. |
• |
1% of the total number of New Cvent Common Stock then outstanding; or
|
• |
the average weekly reported trading volume of the New Cvent Common Stock during the four calendar weeks preceding the filing of a notice on Form 144 with respect to the sale.
|
• |
the issuer of the securities that was formerly a shell company has ceased to be a shell company;
|
• |
the issuer of the securities is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act;
|
• |
the issuer of the securities has filed all Exchange Act reports and material required to be filed, as applicable, during the preceding twelve months (or such shorter period that the issuer was required to file such reports and materials), other than Form 8-K reports; and
|
• |
at least one year has elapsed from the time that the issuer filed current Form 10 type information with the SEC reflecting its status as an entity that is not a shell company.
|
• |
not later than the 90th day; and
|
• |
not earlier than the 120th day before the one-year anniversary of the preceding year’s annual meeting.
|
Page
|
||||
Audited Financial Statements of Dragoneer Growth Opportunities Corp. II
|
||||
F-2 | ||||
F-3 | ||||
F-4 | ||||
F-5 | ||||
F-6 | ||||
F-7 | ||||
Unaudited Financial Statements of Dragoneer Growth Opportunities Corp. II
|
||||
F-17 | ||||
F-18 | ||||
F-19 | ||||
F-20 | ||||
F-21 | ||||
F-32 | ||||
F-33 | ||||
F-34 | ||||
F-35 | ||||
F-36 | ||||
Audited Financial Statements of Papay Topco, Inc.
|
||||
F-47 | ||||
F-49 | ||||
F-50 | ||||
F-51 | ||||
F-52 | ||||
F-53 | ||||
Unaudited Financial Statements of Papay Topco, Inc.
|
||||
F-90 | ||||
F-91 | ||||
F-92 | ||||
F-93 | ||||
F-94 |
/s/ WithumSmith+Brown, PC
|
ASSETS
|
||||
Current assets
|
||||
Cash
|
$ | 90,095 | ||
Prepaid expenses
|
1,188,660 | |||
|
|
|||
Total Current Assets
|
1,278,755 | |||
Cash held in Trust Account
|
276,000,000 | |||
|
|
|||
TOTAL ASSETS
|
$
|
277,278,755
|
|
|
|
|
|||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
||||
Current liabilities - accrued expenses
|
$ | 25,296 | ||
Deferred underwriting fee payable
|
9,660,000 | |||
|
|
|||
Total Liabilities
|
|
9,685,296
|
|
|
|
|
|||
Class A ordinary shares subject to possible redemption, 26,259,345 shares at $10.00 per share
|
262,593,450 | |||
Shareholders’ Equity
|
||||
Preference shares, $0.0001 par value; 1,000,000 shares authorized; no shares issued and outstanding
|
— | |||
Class A ordinary shares, $0.0001 par value; 200,000,000 shares authorized; 2,092,655 shares issued and outstanding (excluding 26,259,345 shares subject to possible redemption)
|
209 | |||
Class B ordinary shares, $0.0001 par value; 20,000,000 shares authorized; 6,900,000 shares issued and outstanding
|
690 | |||
Additional paid-in capital
|
5,096,874 | |||
Accumulated deficit
|
(97,764 | ) | ||
|
|
|||
Total Shareholders’ Equity
|
|
5,000,009
|
|
|
|
|
|||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
|
$
|
277,278,755
|
|
Formation and operational costs
|
$ | 97,764 | ||
|
|
|||
Net Loss
|
$
|
(97,764
|
)
|
|
|
|
|||
Weighted average shares outstanding of Class A redeemable ordinary shares
|
27,600,000 | |||
|
|
|||
Basic and diluted net income per ordinary share, Class A
|
$
|
0.00
|
|
|
Weighted average shares outstanding of Class A and B non-redeemable ordinary shares
|
7,236,000 | |||
|
|
|||
Basic and diluted net loss per ordinary share, Class A and B
|
$
|
(0.01
|
)
|
|
|
|
Class A
Ordinary Shares
|
Class B
Ordinary Shares
|
Additional
Paid in
Capital
|
Accumulated
Deficit
|
Total
Shareholders’
Equity
|
||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||||||||||||||
Balance — September 25, 2020 (inception)
|
— | $ | — | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||
Issuance of Class B ordinary shares to Sponsor
|
— | — | 6,900,000 | 690 | 24,310 | — | 25,000 | |||||||||||||||||||||
Sale of 27,600,000 Public Shares, net of underwriting discounts and offering costs
|
27,600,000 | 2,760 | — | — | 260,143,463 | — | 260,146,223 | |||||||||||||||||||||
Sale of 752,000 Private Placement Shares
|
752,000 | 75 | — | — | 7,519,925 | — | 7,520,000 | |||||||||||||||||||||
Class A ordinary shares subject to possible redemption
|
(26,259,345 | ) | (2,626 | ) | — | — | (262,590,824 | ) | — | (262,593,450 | ) | |||||||||||||||||
Net loss
|
— | — | — | — | — | (97,764 | ) | (97,764 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance — December 31, 2020
|
|
2,092,655
|
|
$
|
209
|
|
|
6,900,000
|
|
$
|
690
|
|
$
|
5,096,874
|
|
$
|
(97,764
|
)
|
$
|
5,000,009
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Operating Activities:
|
||||
Net loss
|
$ | (97,764 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||
Payment of formation costs through issuance of Class B ordinary shares
|
5,000 | |||
Changes in operating assets and liabilities:
|
||||
Prepaid expenses
|
(1,188,660 | ) | ||
Accrued expenses
|
25,296 | |||
|
|
|||
Net cash used in operating activities
|
|
(1,256,128
|
)
|
|
|
|
|||
Cash Flows from Investing Activities:
|
||||
Investment of cash in Trust Account
|
(276,000,000 | ) | ||
|
|
|||
Net cash used in investing activities
|
|
(276,000,000
|
)
|
|
|
|
|||
Cash Flows from Financing Activities:
|
||||
Proceeds from sale of Public Shares, net of underwriting discounts paid
|
270,480,000 | |||
Proceeds from sale of Private Placement Shares
|
7,520,000 | |||
Repayment of promissory note – related party
|
(104,462 | ) | ||
Payments of offering costs
|
(549,315 | ) | ||
|
|
|||
Net cash provided by financing activities
|
|
277,346,223
|
|
|
|
|
|||
Net Change in Cash
|
|
90,095
|
|
|
Cash – Beginning
|
— | |||
|
|
|||
Cash – Ending
|
$
|
90,095
|
|
|
|
|
|||
Non-Cash Investing and Financing Activities:
|
||||
Initial classification of Class A ordinary shares subject to possible redemption
|
$ | 262,686,220 | ||
|
|
|||
Change in value of Class A ordinary shares subject to possible redemption
|
$ | (92,770 | ) | |
|
|
|||
Deferred underwriting fee payable
|
$ | 9,660,000 | ||
|
|
|||
Offering costs paid directly by Sponsor in consideration for the issuance of Class B ordinary shares
|
$ | 20,000 | ||
|
|
|||
Payment of offering costs through promissory note – related party
|
$ | 104,462 | ||
|
|
For the Period
from September 25, 2020 (inception) Through December 31, 2020 |
||||
Redeemable Class A Ordinary Shares
|
||||
Numerator: Earnings allocable to Redeemable Class A Ordinary Shares
|
||||
Interest Income
|
$ | — | ||
|
|
|||
Net Earnings
|
$ | — | ||
Denominator: Weighted Average Redeemable Class A Ordinary Shares
|
||||
Redeemable Class A Ordinary Shares, Basic and Diluted
|
27,600,000 | |||
Earnings/Basic and Diluted Redeemable Class A Ordinary Shares
|
$
|
0.00
|
|
|
Non-Redeemable Class A and B Ordinary Shares
|
||||
Numerator: Net Loss minus Redeemable Net Earnings
|
||||
Net Loss
|
$ | (97,764 | ) | |
Redeemable Net Earnings
|
$ | — | ||
|
|
|||
Non-Redeemable Net Loss
|
$
|
(97,764
|
)
|
|
Denominator: Weighted Average Non-Redeemable Class A and B Ordinary Shares
|
||||
Non-Redeemable Class A and B Ordinary Shares, Basic and Diluted (1)
|
7,236,000 | |||
Loss/Basic and Diluted Non-Redeemable Class A and B Ordinary Shares
|
$
|
(0.01
|
)
|
|
|
|
(1) |
The weighted average non-redeemable ordinary shares for the period from September 25, 2020 (inception) through December 31, 2020 includes the effect of 752,000 Private Placement Shares, which were issued in conjunction with the Initial Public Offering on November 19, 2020.
|
March 31,
2021 |
December 31,
2020 |
|||||||
(Unaudited)
|
||||||||
ASSETS
|
||||||||
Current assets
|
||||||||
Cash
|
$ | 2,032,151 | $ | 90,095 | ||||
Prepaid expenses
|
1,073,441 | 1,188,660 | ||||||
|
|
|
|
|||||
Total Current Assets
|
3,105,592 | 1,278,755 | ||||||
Investment held in Trust Account
|
276,002,496 | 276,000,000 | ||||||
|
|
|
|
|||||
TOTAL ASSETS
|
$
|
279,108,088
|
|
$
|
277,278,755
|
|
||
|
|
|
|
|||||
LIABILITIES AND SHAREHOLDERS’ DEFICIT
|
||||||||
Current liabilities
|
||||||||
Accrued expenses
|
$ | 226,271 | $ | 25,296 | ||||
Convertible note
|
2,000,000 | — | ||||||
|
|
|
|
|||||
Total Current Liabilities
|
2,226,271 | 25,296 | ||||||
Deferred underwriting fee payable
|
9,660,000 | 9,660,000 | ||||||
|
|
|
|
|||||
Total Liabilities
|
|
11,886,271
|
|
|
9,685,296
|
|
||
|
|
|
|
|||||
Commitments
|
||||||||
Class A ordinary shares subject to possible redemption 27,600,000 at $10.00 per share redemption value as of March 31, 2021 and December 31, 2020
|
276,000,000 | 276,000,000 | ||||||
Shareholders’ Deficit
|
||||||||
Preference shares, $0.0001 par value; 1,000,000 shares authorized; none issued or outstanding
|
— | — | ||||||
Class A ordinary shares, $0.0001 par value; 200,000,000 shares authorized; 752,000 shares issued and outstanding (excluding 27,600,000 shares subject to possible redemption) as of March 31, 2021 and December 31, 2020
|
75 | 75 | ||||||
Class B ordinary shares, $0.0001 par value; 20,000,000 shares authorized; 6,900,000 shares issued and outstanding as of March 31, 2021 and December 31, 2020
|
690 | 690 | ||||||
Additional
paid-in
capital
|
— | — | ||||||
Accumulated deficit
|
(8,778,948 | ) | (8,407,306 | ) | ||||
|
|
|
|
|||||
Total Shareholders’ Deficit
|
|
(8,778,183
|
)
|
|
(8,406,541
|
)
|
||
|
|
|
|
|||||
TOTAL LIABILITIES AND SHAREHOLDERS’ DEFICIT
|
$
|
279,108,088
|
|
$
|
277,278,755
|
|
||
|
|
|
|
General and administrative expenses
|
374,138 | |||
|
|
|||
Loss from operations
|
|
(374,138
|
)
|
|
Other income:
|
||||
Interest earned on marketable securities held in Trust Account
|
2,496 | |||
|
|
|||
Net loss
|
$
|
(371,642
|
)
|
|
|
|
|||
Weighted average shares outstanding of Class A redeemable ordinary shares
|
27,600,000 | |||
|
|
|||
Basic and diluted income per share, Class A redeemable ordinary shares
|
$
|
0.00
|
|
|
|
|
|||
Weighted average shares outstanding of Class A and Class B
non-redeemable
ordinary shares
|
7,652,000 | |||
|
|
|||
Basic and diluted net loss per share, Class A and Class B
non-redeemable
ordinary shares
|
$
|
(0.05
|
)
|
|
|
|
Class A
Ordinary Shares |
Class B
Ordinary Shares |
Additional
Paid-in
Capital
|
Accumulated
Deficit
|
Total
Shareholders’
Deficit
|
||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
|||||||||||||||||||||||||
Balance – January 1, 2021
|
|
752,000
|
|
$
|
75
|
|
|
6,900,000
|
|
$
|
690
|
|
$
|
—
|
$
|
(8,407,306
|
)
|
$
|
(8,406,541
|
)
|
||||||||
Net loss
|
— | — | — | — | — | (371,642 | ) | (371,642 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance – March 31, 2021
|
|
752,000
|
|
$
|
75
|
|
|
6,900,000
|
|
$
|
690
|
|
$
|
—
|
$
|
(8,778,948
|
)
|
$
|
(8,778,183
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Operating Activities:
|
||||
Net loss
|
$ | (371,642 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||
Interest earned on marketable securities held in Trust Account
|
(2,496 | ) | ||
Changes in operating assets and liabilities:
|
||||
Prepaid expenses
|
115,219 | |||
Accrued expenses
|
200,975 | |||
|
|
|||
Net cash used in operating activities
|
|
(57,944
|
)
|
|
|
|
|||
Cash Flows from Financing Activities
|
||||
Proceeds from convertible promissory note – related party
|
2,000,000 | |||
|
|
|||
Net cash provided by financing activities
|
$ | 2,000,000 | ||
|
|
|||
Net Change in Cash
|
|
1,942,056
|
|
|
Cash – Beginning of period
|
90,095 | |||
|
|
|||
Cash – End of period
|
$
|
2,032,151
|
|
|
|
|
As
Previously Reported |
Adjustments
|
As
Revised |
||||||||||
Balance sheet as of November 19, 2020
|
||||||||||||
Class A Ordinary Shares Subject to Possible Redemption
|
262,686,220 | 13,313,780 | 276,000,000 | |||||||||
Class A Ordinary Shares
|
208 | (133 | ) | 75 | ||||||||
Additional
Paid-in
Capital
|
5,004,105 | (5,004,105 | ) | — | ||||||||
Accumulated Deficit
|
(4,999 | ) | (8,309,542 | ) | (8,314,541 | ) | ||||||
Total Shareholders’ Equity (Deficit)
|
5,000,004 | (13,313,780 | ) | (8,313,776 | ) | |||||||
Balance sheet as of December 31, 2020
|
||||||||||||
Class A Ordinary Shares Subject to Possible Redemption
|
262,593,450 | 13,406,550 | 276,000,000 | |||||||||
Class A Ordinary Shares
|
209 | (134 | ) | 75 | ||||||||
Additional
Paid-in
Capital
|
5,096,874 | (5,096,874 | ) | — | ||||||||
Accumulated Deficit
|
(97,764 | ) | (8,309,542 | ) | (8,407,306 | ) | ||||||
Total Shareholders’ Equity (Deficit)
|
5,000,009 | (13,406,550 | ) | (8,406,541 | ) |
Three Months
Ended March 31, 2021 |
||||
Redeemable Class A Ordinary Shares
|
||||
Numerator: Earnings allocable to Redeemable Class A Ordinary Shares
|
||||
Interest Income
|
$ | 2,496 | ||
|
|
|||
Net Earnings
|
$ | 2,496 | ||
Denominator: Weighted Average Redeemable Class A Ordinary Shares
|
||||
Redeemable Class A Ordinary Shares, Basic and Diluted
|
27,600,000 | |||
Earnings/Basic and Diluted Redeemable Class A Ordinary Shares
|
$ | 0.00 | ||
Non-Redeemable
Class A and B Ordinary Shares
|
||||
Numerator: Net Loss minus Redeemable Net Earnings
|
||||
Net Loss
|
$ | (371,642 | ) | |
Redeemable Net Earnings
|
(2,496 | ) | ||
|
|
|||
Non-Redeemable
Net Loss
|
$ | (374,138 | ) | |
Denominator: Weighted Average
Non-Redeemable
Class A and B Ordinary Shares
|
||||
Non-Redeemable
Class A and B Ordinary Shares, Basic and Diluted (1)
|
7,652,000 | |||
Loss/Basic and Diluted
Non-Redeemable
Class A and B Ordinary Shares
|
$ | (0.05 | ) |
(1) |
The weighted average
non-redeemable
ordinary shares for period ended March 31, 2021 includes the effect of 752,000 Private Placement Shares, which were issued in conjunction with the Initial Public Offering on November 19, 2020
|
Level 1: | Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis. | |
Level 2: | Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active. | |
Level 3: | Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability. |
Description
|
Level
|
March 31, 2021
|
December 31, 2020
|
|||||||||
Assets:
|
||||||||||||
Marketable securities held in Trust Account – Money Market Funds
|
1 | $ | 276,002,496 | $ | — |
Three Months
Ended June 30, |
Six Months Ended
June 30, |
|||||||
2021
|
2021
|
|||||||
General and administrative expenses
|
$ | 1,405,778 | $ | 1,779,916 | ||||
|
|
|
|
|||||
Loss from operations
|
|
(1,405,778
|
)
|
|
(1,779,916
|
)
|
||
|
|
|
||||||
Other income
|
||||||||
Interest earned on marketable securities held in Trust Account
|
6,281 | 8,777 | ||||||
|
|
|
|
|||||
|
|
|
||||||
Net
L
oss
|
$
|
(1,399,497
|
)
|
$
|
(1,771,139
|
)
|
||
|
|
|
|
|||||
Weighted average shares outstanding of Class A redeemable ordinary shares
|
27,600,000 | 27,600,000 | ||||||
|
|
|
|
|||||
Basic and diluted income per share, Class A redeemable ordinary shares
|
$ | 0.00 | $ | 0.00 | ||||
|
|
|
|
|||||
|
|
|
||||||
Weighted average shares outstanding of Class A and Class B
non-redeemable
ordinary shares
|
7,652,000 | 7,652,000 | ||||||
|
|
|
|
|||||
Basic and diluted net loss per share, Class A and Class B
non-redeemable
ordinary shares
|
$ |
(0.18
|
)
|
$ |
(0.23
|
)
|
||
|
|
|
|
Class A
Ordinary Shares |
Class B
Ordinary Shares |
Additional
Paid-in
|
Accumulated
|
Total
Shareholders’ |
||||||||||||||||||||||||
Shares
|
Amount
|
Shares
|
Amount
|
Capital
|
Deficit
|
Deficit
|
||||||||||||||||||||||
Balance – January 1, 2021
|
|
752,000
|
|
$
|
75
|
|
|
6,900,00
|
|
$
|
690
|
|
$
|
—
|
$
|
(8,407,306
|
)
|
$
|
(8,406,541
|
)
|
||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Net loss
|
— | — | — | — | — | (371,642 | ) | (371,642 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance – March 31, 2021 (unaudited)
|
|
752,000
|
|
$
|
75
|
|
|
6,900,00
|
|
$
|
690
|
|
$
|
—
|
$
|
(8,778,948
|
)
|
$
|
(8,778,183
|
)
|
||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Net loss
|
— | — | — | — | — | (1,399,497 | ) | (1,399,497 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Balance – June 30, 2021 (unaudited)
|
|
752,000
|
|
$
|
75
|
|
|
6,900,00
|
|
$
|
690
|
|
$
|
—
|
$
|
(10,178,445
|
)
|
$
|
(10,177,680
|
)
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Flows from Operating Activities:
|
||||
Net loss
|
$ | (1,771,139 | ) | |
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||
Interest earned on marketable securities held in Trust Account
|
(8,777 | ) | ||
Changes in operating assets and liabilities:
|
||||
Prepaid expenses
|
287,636 | |||
Accrued expenses
|
1,344,210 | |||
|
|
|||
Net cash used in operating activities
|
|
(148,070
|
)
|
|
|
|
|||
|
|
|||
Cash Flows from Financing Activities
|
||||
Advances from related party
|
24,702 | |||
Proceeds from convertible promissory note - related party
|
2,000,000 | |||
|
|
|||
Net cash provided by financing activities
|
$ | 2,024,702 | ||
|
|
|||
|
|
|||
Net Change in Cash
|
|
1,876,632
|
|
|
Cash – Beginning of period
|
90,095 | |||
|
|
|||
Cash – End of period
|
1,966,727
|
|
||
|
|
Three Months
Ended
June 30,
|
Six Months
Ended
June 30,
|
|||||||
Redeemable Class A Ordinary Shares
|
||||||||
Numerator: Earnings allocable to Redeemable Class A Ordinary Shares
|
||||||||
Interest Income
|
$ | 6,281 | $ | 8,777 | ||||
|
|
|
|
|||||
Redeemable Net Earnings
|
$ | 6,281 | $ | 8,777 | ||||
|
|
|
|
|||||
Denominator: Weighted Average Redeemable Class A Ordinary Shares
|
||||||||
Redeemable Class A Ordinary Shares, Basic and Diluted
|
27,600,000 | 27,600,000 | ||||||
Earnings/Basic and Diluted Redeemable Class A Ordinary Shares
|
$ | 0.00 | $ | 0.00 | ||||
|
|
|
||||||
Non-Redeemable
Class A and B Ordinary Shares
|
||||||||
Numerator: Net Loss minus Redeemable Net Earnings
|
||||||||
Net Loss
|
$ | (1,399,497 | ) | $ | (1,771,139 | ) | ||
Redeemable Net Earnings
|
(6,281 | ) | (8,777 | ) | ||||
|
|
|
|
|||||
Non-Redeemable Net Loss
|
$ | (1,405,778 | ) | $ | (1,779,916 | ) | ||
Denominator: Weighted Average
Non-Redeemable
Class A and B Ordinary Shares
|
||||||||
Non-Redeemable
Class A and B Ordinary Shares, Basic and Diluted (1)
|
7,652,000 | 7,652,000 | ||||||
Loss/Basic and Diluted
Non-Redeemable
Class A and B Ordinary Shares
|
$ | (0.18 | ) | $ | (0.23 | ) |
(1) |
The weighted average
non-redeemable
ordinary shares for period ended June 30, 2021 includes the effect of 752,000 Private Placement Shares, which were issued in conjunction with the Initial Public Offering on November 19, 2020
.
|
Level 1:
|
|
Quoted prices in active markets for identical assets or liabilities. An active market for an asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
|
Level 2:
|
|
Observable inputs other than Level 1 inputs. Examples of Level 2 inputs include quoted prices in active markets for similar assets or liabilities and quoted prices for identical assets or liabilities in markets that are not active.
|
Level 3:
|
|
Unobservable inputs based on our assessment of the assumptions that market participants would use in pricing the asset or liability.
|
Description
|
|
Level
|
|
|
June 30,
|
|
|
December 31, 2020
|
|
|||
Assets:
|
|
|
||||||||||
Marketable securities held in Trust Account – Money Market Funds
|
|
1 |
|
$ | 276,008,777 | $ | — |
December 31,
|
||||||||
2020
|
2019
|
|||||||
Assets
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$ | 65,265 | $ | 72,315 | ||||
Restricted cash
|
205 | 406 | ||||||
Short-term investments
|
— | 982 | ||||||
Accounts receivable, net of allowance of $3.3 million and $1.9 million, respectively
|
141,113 | 144,711 | ||||||
Capitalized commissions, net
|
22,000 | 22,284 | ||||||
Prepaid expenses and other current assets
|
12,415 | 12,452 | ||||||
|
|
|
|
|||||
Total current assets
|
240,998 | 253,150 | ||||||
Property and equipment, net
|
21,715 | 35,708 | ||||||
Capitalized software development costs, net
|
124,030 | 143,575 | ||||||
Intangible assets, net
|
272,416 | 325,082 | ||||||
Goodwill
|
1,605,628 | 1,614,157 | ||||||
Operating lease right-of-use assets
|
38,922 | 47,164 | ||||||
Capitalized commissions, net, non-current
|
20,427 | 18,179 | ||||||
Deferred tax assets, non-current
|
2,036 | 2,163 | ||||||
Other assets, non-current, net
|
5,479 | 5,838 | ||||||
|
|
|
|
|||||
Total assets
|
$ | 2,331,651 | $ | 2,445,016 | ||||
|
|
|
|
|||||
Liabilities and Stockholders’ Equity
|
||||||||
Current liabilities:
|
||||||||
Current portion of long-term debt
|
$ | 17,920 | $ | 4,484 | ||||
Accounts payable
|
4,078 | 5,889 | ||||||
Accrued expenses and other current liabilities
|
81,939 | 72,776 | ||||||
Fees payable to customers
|
16,872 | 58,928 | ||||||
Operating lease liabilities, current
|
15,910 | 15,511 | ||||||
Deferred revenue
|
207,622 | 225,131 | ||||||
|
|
|
|
|||||
Total current liabilities
|
344,341 | 382,719 | ||||||
Deferred tax liabilities, non-current
|
16,950 | 15,062 | ||||||
Long-term debt, net
|
753,953 | 758,473 | ||||||
Operating lease liabilities, non-current
|
40,317 | 49,015 | ||||||
Other liabilities, non-current
|
5,239 | 3,966 | ||||||
|
|
|
|
|||||
Total liabilities
|
1,160,800 | 1,209,235 | ||||||
Commitments and contingencies (Note 14)
|
||||||||
Stockholders’ equity:
|
||||||||
Common stock, $0.001 par value, 1,100,000 shares authorized at December 31, 2020 and 2019; 917,365 and 917,085 shares issued and outstanding as of December 31, 2020 and 2019, respectively
|
1 | 1 | ||||||
Additional paid-in capital
|
1,936,447 | 1,918,809 | ||||||
Accumulated other comprehensive loss
|
(69 | ) | (1,234 | ) | ||||
Accumulated deficit
|
(765,528 | ) | (681,795 | ) | ||||
|
|
|
|
|||||
Total stockholders’ equity
|
1,170,851 | 1,235,781 | ||||||
|
|
|
|
|||||
Total liabilities and stockholders’ equity
|
$ | 2,331,651 | $ | 2,445,016 | ||||
|
|
|
|
Year ended December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Revenue
|
$ | 498,700 | $ | 567,604 | $ | 480,015 | ||||||
Cost of revenue
|
176,250 | 211,857 | 165,181 | |||||||||
|
|
|
|
|
|
|||||||
Gross profit
|
322,450 | 355,747 | 314,834 | |||||||||
Operating expenses:
|
||||||||||||
Sales and marketing
|
128,388 | 155,801 | 126,531 | |||||||||
Research and development
|
87,866 | 96,012 | 78,447 | |||||||||
General and administrative
|
80,564 | 92,018 | 76,155 | |||||||||
Intangible asset amortization, exclusive of amounts included in cost of revenue
|
53,844 | 57,685 | 60,494 | |||||||||
|
|
|
|
|
|
|||||||
Total operating expenses
|
350,662 | 401,516 | 341,627 | |||||||||
|
|
|
|
|
|
|||||||
Loss from operations
|
(28,212 | ) | (45,769 | ) | (26,793 | ) | ||||||
Interest expense
|
(35,557 | ) | (47,875 | ) | (42,259 | ) | ||||||
Amortization of deferred financing costs and debt discount
|
(3,798 | ) | (3,836 | ) | (3,704 | ) | ||||||
Loss on divestitures, net
|
(9,634 | ) | — | — | ||||||||
Other income/(expense), net
|
1,333 | (294 | ) | (1,391 | ) | |||||||
|
|
|
|
|
|
|||||||
Loss before income taxes
|
(75,868 | ) | (97,774 | ) | (74,147 | ) | ||||||
Provision for/(benefit from) income taxes
|
7,865 | (6,013 | ) | (20,107 | ) | |||||||
|
|
|
|
|
|
|||||||
Net loss
|
$ | (83,733 | ) | $ | (91,761 | ) | $ | (54,040 | ) | |||
|
|
|
|
|
|
|||||||
Other comprehensive income/(loss):
|
||||||||||||
|
|
|
|
|
|
|||||||
Foreign currency translation gain/(loss)
|
1,165 | 1,376 | (307 | ) | ||||||||
|
|
|
|
|
|
|||||||
Comprehensive loss
|
$ | (82,568 | ) | $ | (90,385 | ) | $ | (54,347 | ) | |||
|
|
|
|
|
|
|||||||
Basic and Diluted net loss per common share
|
$ | (91.30 | ) | $ | (100.81 | ) | $ | (60.04 | ) | |||
|
|
|
|
|
|
|||||||
Basic and Diluted weighted-average common shares outstanding
|
917,109 | 910,263 | 900,003 |
Common Stock
|
Amount
|
|||||||||||||||||||||||
Shares
|
Amount
|
Additional
paid-in
capital
|
Accumulated
deficit
|
Accumulated
other
comprehensive
income / (loss)
|
Total
stockholders’
equity
|
|||||||||||||||||||
Balance as of January 1, 2018
|
900,000 | $ | 1 | $ | 1,853,065 | $ | (558,743 | ) | $ | (2,303 | ) | $ | 1,292,020 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Cumulative effect from adoption of ASC 606
|
— | — | — | 22,588 | — | 22,588 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Adjusted balance as of January 1, 2018
|
900,000 | $ | 1 | $ | 1,853,065 | $ | (536,155 | ) | $ | (2,303 | ) | $ | 1,314,608 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Stock-based compensation
|
— | — | 18,609 | — | — | 18,609 | ||||||||||||||||||
Net loss
|
— | — | — | (54,040 | ) | — | (54,040 | ) | ||||||||||||||||
Exercise of stock options
|
28 | — | 26 | — | 26 | |||||||||||||||||||
Foreign currency translation gain/(loss)
|
— | — | — | — | (307 | ) | (307 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance as of December 31, 2018
|
900,028 | $ | 1 | $ | 1,871,700 | $ | (590,195 | ) | $ | (2,610 | ) | $ | 1,278,896 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Cumulative effect from adoption of ASC 842
|
4 | 4 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Adjusted balance as of January 1, 2019
|
900,028 | $ | 1 | $ | 1,871,700 | $ | (590,191 | ) | $ | (2,610 | ) | $ | 1,278,900 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Stock-based compensation
|
— | — | 18,833 | — | — | 18,833 | ||||||||||||||||||
Net loss
|
— | — | — | (91,761 | ) | — | (91,761 | ) | ||||||||||||||||
Exercise of stock options
|
17,251 | — | 28,539 | — | — | 28,539 | ||||||||||||||||||
Repurchase of stock options
|
(194 | ) | — | (253 | ) | — | — | (253 | ) | |||||||||||||||
Other activity
|
— | — | (10 | ) | 157 | — | 147 | |||||||||||||||||
Foreign currency translation gain/(loss)
|
— | — | — | — | 1,376 | 1,376 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance as of December 31, 2019
|
917,085 | $ | 1 | $ | 1,918,809 | $ | (681,795 | ) | $ | (1,234 | ) | $ | 1,235,781 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Stock-based compensation
|
— | — | 17,695 | — | — | 17,695 | ||||||||||||||||||
Net loss
|
— | — | — | (83,733 | ) | — | (83,733 | ) | ||||||||||||||||
Exercise of stock options
|
1,103 | — | 72 | — | — | 72 | ||||||||||||||||||
Repurchase of stock options
|
(823 | ) | — | (129 | ) | — | — | (129 | ) | |||||||||||||||
Foreign currency translation gain/(loss)
|
— | — | — | — | 1,165 | 1,165 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance as of December 31, 2020
|
917,365 | $ | 1 | $ | 1,936,447 | $ | (765,528 | ) | $ | (69 | ) | $ | 1,170,851 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Year ended December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Operating activities:
|
||||||||||||
Net loss
|
$ | (83,733 | ) | $ | (91,761 | ) | (54,040 | ) | ||||
Adjustments to reconcile net loss to net cash provided by operating activities:
|
||||||||||||
Depreciation and amortization
|
127,723 | 120,912 | 108,574 | |||||||||
Amortization of the right-of-use assets
|
10,380 | 8,207 | — | |||||||||
Allowance for expected credit losses
|
3,280 | 1,407 | 490 | |||||||||
Amortization of deferred financing costs and debt discount
|
3,798 | 3,836 | 3,704 | |||||||||
Amortization of capitalized commission
|
29,119 | 25,641 | 22,644 | |||||||||
Unrealized foreign currency transaction gain
|
67 | 39 | 522 | |||||||||
Loss on divestitures, net
|
9,634 | — | — | |||||||||
Stock-based compensation
|
17,695 | 18,833 | 17,911 | |||||||||
Change in deferred taxes
|
2,016 | (12,299 | ) | (26,134 | ) | |||||||
Change in operating assets and liabilities, net of acquired assets and liabilities:
|
||||||||||||
Accounts receivable
|
786 | (23,412 | ) | (33,122 | ) | |||||||
Prepaid expenses and other assets
|
3,563 | (2,002 | ) | 3,389 | ||||||||
Capitalized commissions, net
|
(30,604 | ) | (31,278 | ) | (26,470 | ) | ||||||
Accounts payable, accrued expenses and other liabilities
|
(36,433 | ) | (2,452 | ) | (3,646 | ) | ||||||
Operating lease liabilities
|
(11,601 | ) | (10,002 | ) | — | |||||||
Deferred revenue
|
(16,591 | ) | 42,360 | 35,951 | ||||||||
|
|
|
|
|
|
|||||||
Net cash provided by operating activities
|
29,099 | 48,029 | 49,773 | |||||||||
Investing activities:
|
||||||||||||
Purchase of property and equipment
|
(2,081 | ) | (19,851 | ) | (12,084 | ) | ||||||
Capitalized software development costs
|
(40,572 | ) | (45,042 | ) | (36,616 | ) | ||||||
Purchase of short-term investments
|
(26,919 | ) | (27,759 | ) | (28,375 | ) | ||||||
Maturities of short-term investments
|
27,901 | 35,627 | 20,995 | |||||||||
Acquisitions, net of cash acquired
|
(1,400 | ) | (16,729 | ) | (121,689 | ) | ||||||
Proceeds from divestiture
|
500 | — | — | |||||||||
|
|
|
|
|
|
|||||||
Net cash used in investing activities
|
(42,571 | ) | (73,754 | ) | (177,769 | ) | ||||||
Financing activities:
|
||||||||||||
Short-term related party financing received
|
— | — | 40,000 | |||||||||
Short-term related party financing payment
|
— | — | (40,000 | ) | ||||||||
Issuance of long-term debt, net
|
— | — | 91,660 | |||||||||
Principal repayments on first lien term loan
|
(7,935 | ) | (7,935 | ) | (5,484 | ) | ||||||
Principal repayments of revolving credit facility
|
(26,600 | ) | — | — | ||||||||
Proceeds from revolving credit facility
|
40,000 | — | — | |||||||||
Repurchase of stock
|
(10 | ) | (253 | ) | — | |||||||
Proceeds from exercise of stock options
|
73 | 28,540 | 26 | |||||||||
|
|
|
|
|
|
|||||||
Net cash provided by financing activities
|
5,528 | 20,352 | 86,202 | |||||||||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
|
693 | 255 | 1,029 | |||||||||
|
|
|
|
|
|
|||||||
Change in cash, cash equivalents, and restricted cash
|
(7,251 | ) | (5,118 | ) | (40,765 | ) | ||||||
Cash, cash equivalents, and restricted cash, beginning of year
|
72,721 | 77,839 | 118,604 | |||||||||
|
|
|
|
|
|
|||||||
Cash, cash equivalents, and restricted cash, end of year
|
$ | 65,470 | $ | 72,721 | 77,839 | |||||||
|
|
|
|
|
|
|||||||
Supplemental cash flow information:
|
||||||||||||
Interest paid
|
$ | 35,552 | $ | 47,856 | 41,905 | |||||||
Income taxes paid
|
$ | 6,193 | $ | 7,092 | 3,746 | |||||||
|
|
|
|
|
|
|||||||
Supplemental disclosure of non-cash investing and financing activities:
|
||||||||||||
Outstanding payments for purchase of property and equipment at year end
|
$ | 413 | $ | 622 | 1,829 | |||||||
Outstanding payments for capitalized software development costs at year end
|
$ | 356 | $ | 701 | 311 | |||||||
|
|
|
|
|
|
Year Ended
December 31, |
||||||||
2020
|
2019
|
|||||||
Cash and cash equivalents
|
$ | 65,265 | $ | 72,315 | ||||
Restricted cash
|
205 | 406 | ||||||
|
|
|
|
|||||
Cash, cash equivalents, and restricted cash
|
$ | 65,470 | $ | 72,721 | ||||
|
|
|
|
Year Ended
December 31, |
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Allowance for expected credit losses, beginning of period
|
$ | 1,912 | $ | 3,379 | $ | 3,326 | ||||||
Credit loss expense
|
3,280 | 1,407 | 490 | |||||||||
Write-offs and adjustments
|
(1,905 | ) | (2,874 | ) | (437 | ) | ||||||
|
|
|
|
|
|
|||||||
Allowance for expected credit losses, end of period
|
$ | 3,287 | $ | 1,912 | $ | 3,379 | ||||||
|
|
|
|
|
|
Year Ended
December 31,
|
||||||||
2020
|
2019
|
|||||||
North America
|
$ | 16,976 | $ | 29,093 | ||||
Non-North America
|
4,739 | 6,615 | ||||||
|
|
|
|
|||||
Total
|
$ | 21,715 | $ | 35,708 | ||||
|
|
|
|
As of January 1, 2018
|
||||||||||||
Prior to
adoption of the new standard |
Adjustments
for the new revenue standard |
As adjusted
|
||||||||||
Assets
|
||||||||||||
Accounts receivable, net
|
$ | 87,531 | $ | 92 | $ | 87,623 | ||||||
Capitalized commission, net
|
— | 15,693 | 15,693 | |||||||||
Capitalized commission, net, non-current
|
— | 14,210 | 14,210 | |||||||||
Other assets, non-current, net
|
2,672 | (103 | ) | 2,569 | ||||||||
Liabilities and Stockholders’ Equity
|
||||||||||||
Deferred revenue, current portion
|
130,586 | (1,304 | ) | 129,282 | ||||||||
Deferred tax liability, non-current
|
39,433 | 8,608 | 48,041 | |||||||||
Accumulated deficit
|
(558,743 | ) | 22,588 | (536,155 | ) |
Year ended December 31, 2018
|
||||||||||||
Prior to
adoption of the new standard |
Adjustments
for the new revenue standard |
As
adjusted |
||||||||||
Revenue
|
$ | 479,009 | $ | 1,006 | $ | 480,015 | ||||||
Cost of revenue
|
165,270 | (89 | ) | 165,181 | ||||||||
|
|
|
|
|
|
|||||||
Gross profit
|
313,739 | 1,095 | 314,834 | |||||||||
Operating expenses:
|
||||||||||||
Sales and marketing
|
131,127 | (4,596 | ) | 126,531 | ||||||||
General and administrative
|
76,160 | (5 | ) | 76,155 | ||||||||
|
|
|
|
|
|
|||||||
Research and development
|
78,455 | (8 | ) | 78,447 | ||||||||
Provision for income taxes
|
28,038 | (7,931 | ) | 20,107 | ||||||||
|
|
|
|
|
|
|||||||
Net loss
|
(67,675 | ) | 13,635 | (54,040 | ) | |||||||
|
|
|
|
|
|
As of December 31, 2018
|
||||||||||||
Prior to
adoption of the new standard |
Adjustments
for the new revenue standard |
As adjusted
|
||||||||||
Assets
|
||||||||||||
Accounts receivable, net
|
$ | 121,901 | $ | 118 | $ | 122,019 | ||||||
Capitalized commission, net
|
— | 17,948 | 17,948 | |||||||||
Capitalized commission, net, non-current
|
— | 16,343 | 16,343 | |||||||||
Other assets, non-current, net
|
1,548 | (131 | ) | 1,417 | ||||||||
Liabilities and Stockholders’ Equity
|
||||||||||||
Deferred revenue, current portion
|
182,372 | (2,276 | ) | 180,096 | ||||||||
Deferred tax liability, non-current
|
26,000 | 614 | 26,614 | |||||||||
Accumulated deficit
|
(626,418 | ) | 36,223 | (590,195 | ) | |||||||
Other comprehensive income
|
(2,327 | ) | (283 | ) | (2,610 | ) |
Year Ended
December 31, |
||||||||||||
2020
|
2019
|
2018
|
||||||||||
North America
|
$ | 437,191 | $ | 501,332 | $ | 423,202 | ||||||
Non-North America
|
61,509 | 66,272 | 56,813 | |||||||||
|
|
|
|
|
|
|||||||
Revenue
|
$ | 498,700 | $ | 567,604 | $ | 480,015 | ||||||
|
|
|
|
|
|
Year Ended
December 31, |
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Event Cloud
|
$ | 316,080 | $ | 379,216 | $ | 325,219 | ||||||
Hospitality Cloud
|
182,620 | 188,388 | 154,796 | |||||||||
|
|
|
|
|
|
|||||||
Revenue
|
$ | 498,700 | $ | 567,604 | $ | 480,015 | ||||||
|
|
|
|
|
|
Customer relationships
|
$ | 1,501 | ||
Non-current assets
|
5 | |||
Current liabilities
|
(106 | ) | ||
|
|
|||
Total purchase consideration
|
$ | 1,400 | ||
|
|
Fair value
acquired |
Useful life
(years) |
|||||||
Customer relationships
|
$ | 1,501 | 7 | |||||
|
|
|||||||
Total intangible assets
|
$ | 1,501 | ||||||
|
|
Other current assets
|
$ | 104 | ||
Non-current assets
|
10 | |||
Current liabilities
|
(191 | ) | ||
Non-current liabilities
|
(2 | ) | ||
Trademarks
|
1,005 | |||
Customer relationships
|
1,520 | |||
Developed technology
|
3,477 | |||
Goodwill
|
1,077 | |||
|
|
|||
Total purchase consideration
|
$ | 7,000 | ||
|
|
Fair value
acquired |
Useful life
(years) |
|||||||
Trademarks
|
$ | 1,005 | 7 | |||||
Customer relationships
|
1,520 | 10 | ||||||
Developed technology
|
3,477 | 5 | ||||||
|
|
|||||||
Total intangible assets
|
$ | 6,002 | ||||||
|
|
Cash and cash equivalents
|
$ | 1,768 | ||
Other current assets
|
453 | |||
Non-current assets
|
620 | |||
Current liabilities
|
(4,219 | ) | ||
Non-current liabilities
|
(433 | ) | ||
Trademarks
|
130 | |||
Customer relationships
|
9,212 | |||
Developed technology
|
1,285 | |||
Goodwill
|
3,683 | |||
|
|
|||
Total purchase consideration
|
$ | 12,499 | ||
|
|
Fair value
acquired |
Useful life
(years) |
|||||||
Trademarks
|
$ | 130 | 2 | |||||
Customer relationships
|
9,212 | 7 | ||||||
Developed technology
|
1,285 | 2 | ||||||
|
|
|||||||
Total intangible assets
|
$ | 10,627 | ||||||
|
|
Cash and cash equivalents
|
$ | 545 | ||
Other current assets
|
2,240 | |||
Non-current assets
|
165 | |||
Current liabilities
|
(2,848 | ) | ||
Trademarks
|
106 | |||
Customer relationships
|
14,427 | |||
Developed technology
|
1,374 | |||
Goodwill
|
7,328 | |||
|
|
|||
Total purchase consideration
|
$ | 23,337 | ||
|
|
Fair value
acquired |
Useful life
(years) |
|||||||
Trademarks
|
$ | 106 | 1 | |||||
Customer relationships
|
14,427 | 8 | ||||||
Developed technology
|
1,374 | 3 | ||||||
|
|
|||||||
Total intangible assets
|
$ | 15,907 | ||||||
|
|
Cash and cash equivalents
|
$ | 2,291 | ||
Other current assets
|
1,597 | |||
Non-current assets
|
1,551 | |||
Current liabilities
|
(3,098 | ) | ||
Acquired intangible assets
|
1,762 | |||
Goodwill
|
8,695 | |||
|
|
|||
Total purchase consideration
|
$ | 12,798 | ||
|
|
Fair value
acquired |
Useful life
(years) |
|||||||
Acquired intangible assets
|
$ | 1,762 | 3 | |||||
|
|
|||||||
Total intangible assets
|
$ | 1,762 | ||||||
|
|
Cash and cash equivalents
|
$ | 10,543 | ||
Other current assets
|
1,130 | |||
Non-current assets
|
1,791 | |||
Current liabilities
|
(4,701 | ) | ||
Non-current liabilities
|
(6,841 | ) | ||
Trademarks
|
700 | |||
Customer relationships
|
17,400 | |||
Developed technology
|
4,200 | |||
Goodwill
|
78,466 | |||
|
|
|||
Total purchase consideration
|
$ | 102,688 | ||
|
|
Fair value
acquired |
Useful life
(years) |
|||||||
Trademarks
|
$ | 700 | 2 | |||||
Customer relationships
|
17,400 | 10 | ||||||
Developed technology
|
4,200 | 5 | ||||||
|
|
|||||||
Total intangible assets
|
$ | 22,300 | ||||||
|
|
Carrying value of net assets divested
|
$ | (10,182 | ) | |
Closing net working capital
|
(552 | ) | ||
Cash received for disposition at closing
|
500 | |||
Cash expected to be received post-closing
|
600 | |||
|
|
|||
Gain/(loss) on divestitures, net
|
$ | (9,634 | ) | |
|
|
2020
|
2019
|
|||||||
Computer equipment, purchased software and software developed for internal-use
|
$ | 22,408 | $ | 22,888 | ||||
Leasehold improvements
|
26,675 | 25,872 | ||||||
Furniture and equipment
|
11,075 | 11,343 | ||||||
Rentable onsite solutions equipment
|
6,326 | 9,331 | ||||||
Other
|
66 | 251 | ||||||
|
|
|
|
|||||
Property and equipment, gross
|
66,550 | 69,685 | ||||||
Less accumulated depreciation
|
(44,835 | ) | (33,977 | ) | ||||
|
|
|
|
|||||
Property and equipment, net
|
$ | 21,715 | $ | 35,708 | ||||
|
|
|
|
2020
|
2019
|
|||||||
Capitalized software development costs, gross
|
$ | 339,082 | $ | 301,670 | ||||
Less accumulated amortization
|
(215,052 | ) | (158,095 | ) | ||||
|
|
|
|
|||||
Capitalized software development costs, net
|
$ | 124,030 | $ | 143,575 | ||||
|
|
|
|
Goodwill as of January 1, 2019
|
$ | 1,608,836 | ||
Foreign currency translation adjustments
|
300 | |||
Measurement period adjustments from 2018 acquisitions
|
261 | |||
Addition from 2019 acquisitions (Note 4)
|
4,760 | |||
|
|
|||
Goodwill as of December 31, 2019
|
$ | 1,614,157 | ||
Foreign currency translation adjustments
|
166 | |||
Disposition from divestiture
|
(8,695 | ) | ||
|
|
|||
Goodwill as of December 31, 2020
|
$ | 1,605,628 | ||
|
|
Intangible Assets, Gross
|
Accumulated Amortization
|
Intangible Assets, Net
|
||||||||||||||||||||||||||||||||||
January 1,
2020 |
Additions
and retirements |
December
31, 2020 |
January 1,
2020 |
Expense
and retirements, net |
December
31, 2020 |
January 1,
2020 |
December
31, 2020 |
Weighted
average remaining life as of December 31, 2020 |
||||||||||||||||||||||||||||
Customer relationships
|
$ | 436,182 | $ | 1,817 | $ | 437,999 | $ | (170,643 | ) | $ | (44,280 | ) | $ | (214,923 | ) | $ | 265,539 | $ | 223,076 | 5.6 years | ||||||||||||||||
Trademarks
|
97,185 | (684 | ) | 96,501 | (37,704 | ) | (9,519 | ) | (47,223 | ) | 59,481 | 49,278 | 5.2 years | |||||||||||||||||||||||
Non-compete agreements
|
588 | — | 588 | (588 | ) | — | (588 | ) | — | — | — | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Intangible assets subject to amortization
|
$ | 533,955 | $ | 1,133 | $ | 535,088 | $ | (208,935 | ) | $ | (53,799 | ) | $ | (262,734 | ) | $ | 325,020 | $ | 272,354 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Indefinite-lived assets
|
62 | — | 62 | — | — | — | 62 | 62 | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Intangible assets, net
|
$ | 534,017 | $ | 1,133 | $ | 535,150 | $ | (208,935 | ) | $ | (53,799 | ) | $ | (262,734 | ) | $ | 325,082 | $ | 272,416 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible Assets, Gross
|
Accumulated Amortization
|
Intangible Assets, Net
|
||||||||||||||||||||||||||||||||||
January 1,
2019 |
Additions
and retirements |
December
31, 2019 |
January 1,
2019 |
Expense
and retirements, net |
December
31, 2019 |
January 1,
2019 |
December
31, 2019 |
Weighted
average remaining life as of December 31, 2019 |
||||||||||||||||||||||||||||
Customer relationships
|
$ | 424,860 | $ | 11,322 | $ | 436,182 | $ | (125,699 | ) | $ | (44,944 | ) | $ | (170,643 | ) | $ | 299,161 | $ | 265,539 | 6.5 years | ||||||||||||||||
Trademarks
|
96,046 | 1,139 | 97,185 | (26,735 | ) | (10,969 | ) | (37,704 | ) | 69,311 | 59,481 | 6.2 years | ||||||||||||||||||||||||
Non-compete agreements
|
588 | — | 588 | (588 | ) | — | (588 | ) | — | — | — | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Intangible assets subject to amortization
|
$ | 521,494 | $ | 12,461 | $ | 533,955 | $ | (153,022 | ) | $ | (55,913 | ) | $ | (208,935 | ) | $ | 368,472 | $ | 325,020 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Indefinite-lived assets
|
62 | — | 62 | — | — | — | 62 | 62 | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Intangible assets, net
|
$ | 521,556 | $ | 12,461 | $ | 534,017 | $ | (153,022 | ) | $ | (55,913 | ) | $ | (208,935 | ) | $ | 368,534 | $ | 325,082 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2021
|
$ | 51,338 | ||
2022
|
48,399 | |||
2023
|
46,610 | |||
2024
|
45,132 | |||
2025
|
39,282 | |||
Thereafter
|
41,593 | |||
|
|
|||
Total amortization expense related to acquired intangible assets
|
$ | 272,354 | ||
|
|
2020
|
2019
|
|||||||
Accrued compensation
|
$ | 50,312 | $ | 47,017 | ||||
Sales and other tax liabilities
|
9,550 | 8,607 | ||||||
Other
|
22,077 | 17,152 | ||||||
|
|
|
|
|||||
Accrued expenses and other current liabilities
|
$ | 81,939 | $ | 72,776 | ||||
|
|
|
|
Year ended December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
U.S.
|
$ | (101,146 | ) | $ | (119,221 | ) | (102,298 | ) | ||||
Foreign
|
25,278 | 21,447 | 28,151 | |||||||||
|
|
|
|
|
|
|||||||
Loss before income taxes
|
$ | (75,868 | ) | $ | (97,774 | ) | (74,147 | ) | ||||
|
|
|
|
|
|
Year ended December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Current:
|
||||||||||||
Federal
|
$ | (6 | ) | $ | (67 | ) | 361 | |||||
State
|
850 | 711 | 448 | |||||||||
Foreign
|
5,086 | 5,792 | 5,426 | |||||||||
|
|
|
|
|
|
|||||||
Current tax expense/(benefit)
|
$ | 5,930 | $ | 6,436 | 6,235 | |||||||
Deferred:
|
||||||||||||
Federal
|
237 | (2,128 | ) | (7,557 | ) | |||||||
State
|
1,513 | (9,604 | ) | (19,802 | ) | |||||||
Foreign
|
185 | (717 | ) | 1,017 | ||||||||
|
|
|
|
|
|
|||||||
Deferred tax expense/(benefit)
|
1,935 | (12,449 | ) | (26,342 | ) | |||||||
|
|
|
|
|
|
|||||||
Provision for/(benefit from) income taxes
|
$ | 7,865 | $ | (6,013 | ) | (20,107 | ) | |||||
|
|
|
|
|
|
Year ended December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
U.S. federal statutory rate
|
21.0 | % | 21.0 | % | 21.0 | % | ||||||
Increase (reduction) resulting from:
|
||||||||||||
U.S. state income taxes, net of federal benefits
|
(3.0 | ) | 9.2 | 26.2 | ||||||||
Non-deductible/non-taxable items
|
(0.3 | ) | (1.5 | ) | (1.0 | ) | ||||||
Uncertain tax positions
|
(0.1 | ) | — | (0.7 | ) | |||||||
Tax on unremitted earnings
|
0.1 | (1.1 | ) | (3.4 | ) | |||||||
Foreign tax rate differential
|
(0.7 | ) | (0.5 | ) | (0.6 | ) | ||||||
Change in valuation allowance
|
(18.3 | ) | (16.1 | ) | (8.2 | ) | ||||||
Foreign tax expense
|
0.6 | 0.3 | 0.4 | |||||||||
Global intangible low-taxed income (GILTI)
|
(6.5 | ) | (4.5 | ) | (6.1 | ) | ||||||
Divestiture of Kapow
|
(4.2 | ) | — | — | ||||||||
Other
|
1.0 | (0.6 | ) | (0.5 | ) | |||||||
|
|
|
|
|
|
|||||||
Effective tax rate
|
(10.4 | )% | 6.2 | % | 27.1 | % | ||||||
|
|
|
|
|
|
December 31,
|
||||||||
2020
|
2019
|
|||||||
Deferred tax assets:
|
||||||||
Allowance for doubtful accounts
|
$ | 805 | $ | 430 | ||||
Accrued expenses and other
|
995 | 2,991 | ||||||
Right of use asset
|
14,391 | 15,885 | ||||||
Stock-based compensation
|
14,489 | 12,098 | ||||||
Foreign tax and other credit carryforward
|
9,120 | 9,341 | ||||||
Net operating loss carryforwards
|
123,716 | 134,941 | ||||||
Capitalized software
|
18,765 | 13,146 | ||||||
Deferred revenue
|
3,256 | 4,537 | ||||||
|
|
|
|
|||||
Deferred tax assets
|
$ | 185,537 | $ | 193,369 | ||||
Less: valuation allowance
|
(81,461 | ) | (72,783 | ) | ||||
|
|
|
|
|||||
Net deferred tax assets
|
104,076 | 120,586 | ||||||
|
|
|
|
|||||
Deferred tax liabilities:
|
||||||||
Accrued expenses
|
(6,730 | ) | — | |||||
Right of use liability
|
(9,535 | ) | (11,077 | ) | ||||
Fixed assets
|
(784 | ) | (3,579 | ) | ||||
Deferred revenue
|
— | (64 | ) | |||||
Intangible assets
|
(101,941 | ) | (118,765 | ) | ||||
|
|
|
|
|||||
Total deferred tax liabilities
|
(118,990 | ) | (133,485 | ) | ||||
|
|
|
|
|||||
Net deferred tax assets (liabilities)
|
$ | (14,914 | ) | $ | (12,899 | ) | ||
|
|
|
|
December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Valuation allowance, beginning of year
|
$ | 72,783 | $ | 44,752 | $ | 33,683 | ||||||
Increase
|
8,678 | 28,031 | 11,069 | |||||||||
|
|
|
|
|
|
|||||||
Valuation allowance, end of year
|
$ | 81,461 | $ | 72,783 | $ | 44,752 | ||||||
|
|
|
|
|
|
December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Unrecognized tax benefits, beginning of year
|
$ | 853 | $ | 833 | $ | 740 | ||||||
Reductions for tax positions for prior years
|
56 | 100 | 116 | |||||||||
Lapse of statute of limitations
|
(44 | ) | (80 | ) | (23 | ) | ||||||
|
|
|
|
|
|
|||||||
Unrecognized tax benefits, end of year
|
$ | 865 | $ | 853 | $ | 833 | ||||||
|
|
|
|
|
|
Grant date value:
|
$
|
1,664
|
||
Total awards granted:
|
3,125
|
Year Ended
December 31, |
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Dividend yield
|
— | — | — | |||||||||
Volatility
|
44.65 | % | 37.60 | % | 39.75 | % | ||||||
Expected term (years)
|
5.89 | 5.89 | 6.12 | |||||||||
Risk-free interest rate
|
0.65 | % | 1.80 | % | 2.95 | % |
Stock options
|
Number of
shares subject to option |
Weighted
average exercise price per share |
Weighted
average remaining contractual term (years) |
Aggregate
intrinsic value (in thousands) |
Unrecognized
compensation expense (in thousands) |
|||||||||||||||
Balance at January 1, 2019
|
99,024 | $ | 1,675 | 7.99 | $ | 53,272 | $ | 37,680 | ||||||||||||
Granted
|
2,379 | 2,424 | ||||||||||||||||||
Exercised
|
(17,251 | ) | 1,667 | |||||||||||||||||
Forfeited
|
(609 | ) | 1,974 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balance at December 31, 2019
|
83,543 | $ | 1,697 | 7.08 | $ | 76,153 | $ | 20,500 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Granted
|
648 | 2,354 | ||||||||||||||||||
Exercised
|
(1,103 | ) | 1,705 | |||||||||||||||||
Forfeited
|
(874 | ) | 2,100 | |||||||||||||||||
Expired
|
(619 | ) | 1,715 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balance at December 31, 2020
|
81,595 | $ | 1,698 | 6.08 | $ | 49,446 | $ | 2,708 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Vested and exercisable as of December 31, 2019
|
54,407 | $ | 1,665 | 7.42 | $ | 51,319 | $ | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Vested and exercisable as of December 31, 2020
|
77,819 | $ | 1,671 | 6.43 | $ | 49,262 | $ | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|
Year ended
December 31, |
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Cost of revenue
|
$ | 430 | $ | 519 | $ | 457 | ||||||
Sales and marketing
|
5,199 | 5,382 | 5,289 | |||||||||
Research and development
|
4,140 | 4,325 | 4,316 | |||||||||
General and administrative
(1)
|
7,926 | 8,607 | 7,849 | |||||||||
|
|
|
|
|
|
|||||||
Total stock-based compensation expense
|
$ | 17,695 | $ | 18,833 | $ | 17,911 | ||||||
|
|
|
|
|
|
(1) |
2018 expense includes a benefit of $698 in relation to the cancellation of 2017 Other Equity Awards.
|
• |
contemporaneous independent valuations performed at periodic intervals by an unrelated third-party valuation specialist;
|
• |
the nature of the business and its history since inception;
|
• |
the economic outlook in general and the condition and outlook of the specific industry;
|
• |
the book value of the stock and the financial condition of the business;
|
• |
the operating and financial performance and forecast;
|
• |
whether or not the Company has goodwill or other intangible values;
|
• |
marketability of the common stock;
|
• |
the hiring of key personnel;
|
• |
any corporate or asset acquisitions, or divestitures;
|
• |
present value of estimated future cash flows;
|
• |
the likelihood of achieving a liquidity event for the shares of common stock underlying these stock options, such as an initial public offering or sale of the company, given prevailing market condition and the nature and history of the business;
|
• |
illiquidity of stock-based awards involving securities in a private company;
|
• |
the market performance of comparable publicly traded technology companies; and
|
• |
the U.S. and global capital market conditions.
|
December 31,
|
||||||||
2020
|
2019
|
|||||||
First Lien Principal amount
|
$ | 771,648 | $ | 779,582 | ||||
Revolving Credit Facility Principal Amount
|
13,400 | — | ||||||
Less: original issue discount
|
(1,702 | ) | (2,147 | ) | ||||
Less: unamortized deferred financing costs
|
(11,473 | ) | (14,478 | ) | ||||
|
|
|
|
|||||
Total principal amount and related unamortized debt issuance costs, net
|
$ | 771,873 | $ | 762,957 | ||||
|
|
|
|
2021
|
$ | 7,935 | ||
2022
|
7,935 | |||
2023
|
7,935 | |||
2024
|
747,843 | |||
|
|
|||
Total minimum principal payments on debt
|
$ | 771,648 | ||
|
|
December 31,
2020 |
December 31,
2019 |
|||||||
Assets:
|
||||||||
Operating lease right-of-use assets
|
$ | 38,922 | $ | 47,164 | ||||
|
|
|
|
|||||
Liabilities:
|
||||||||
Current
|
||||||||
Operating lease liabilities
|
15,910 | 15,511 | ||||||
Long-term
|
||||||||
Operating lease liabilities
|
40,317 | 49,015 | ||||||
|
|
|
|
|||||
$ | 56,227 | $ | 64,527 | |||||
|
|
|
|
Year Ended
December 31, 2020 |
Year Ended
December 31, 2019 |
|||||||
Operating leases
|
||||||||
Operating lease cost
|
$ | 15,967 | $ | 12,348 | ||||
Variable lease cost
|
2,781 | 2,433 | ||||||
Short-term lease rent expense
|
567 | 1,229 | ||||||
Less: Sublease income
|
(1,054 | ) | (1,008 | ) | ||||
|
|
|
|
|||||
Net rent expense
|
$ | 18,261 | $ | 15,002 | ||||
|
|
|
|
December 31,
2020 |
December 31,
2019 |
|||||||
Weighted-average remaining lease term – operating leases (in years)
|
4.36 | 5.18 | ||||||
Weighted-average discount rate – operating leases
|
6.0 | % | 6.0 | % |
Year Ended
December 31, 2020 |
Year Ended
December 31, 2019 |
|||||||
Operating cash flows - operating leases
|
$ | 16,480 | $ | 14,136 | ||||
Right-of-use assets obtained in exchange for operating lease liabilities
|
$ | 2,500 | $ | 55,168 |
2021
|
$ | 15,784 | ||
2022
|
14,900 | |||
2023
|
13,375 | |||
2024
|
10,727 | |||
2025
|
6,711 | |||
Thereafter
|
2,503 | |||
|
|
|||
Total
|
64,000 | |||
Less: present value discount
|
(7,773 | ) | ||
|
|
|||
Operating lease liabilities
|
$ | 56,227 | ||
|
|
• |
Paymentech – For a period of no more than twelve months, the Company is entitled to use the services within the Paymentech contract, which enables the processing of credit card fees. This arrangement was terminated as of December 31, 2019.
|
December 31,
|
||||||||
2020
|
2019
|
|||||||
Assets
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$ | — | $ | — | ||||
|
|
|
|
|||||
Total current assets
|
— | — | ||||||
Investment in subsidiaries
|
1,170,949 | 1,235,879 | ||||||
|
|
|
|
|||||
Total assets
|
$ | 1,170,949 | $ | 1,235,879 | ||||
|
|
|
|
|||||
Liabilities and Stockholders’ Equity
|
||||||||
Current liabilities:
|
||||||||
Current portion of long-term debt
|
$ | — | $ | — | ||||
|
|
|
|
|||||
Total current liabilities
|
— | — | ||||||
Due to subsidiaries
|
98 | 98 | ||||||
|
|
|
|
|||||
Total liabilities
|
98 | 98 | ||||||
Commitments and contingencies
|
||||||||
Stockholders’ equity:
|
||||||||
Common stock, $0.001 par value, 1,100,000 shares authorized at December 31, 2020 and 2019; 917,365 and 917,085 shares issued and outstanding as of December 31, 2020 and 2019, respectively
|
1 | 1 | ||||||
Additional paid-in capital
|
1,936,447 | 1,918,809 | ||||||
Accumulated other comprehensive income/(loss)
|
(69 | ) | (1,234 | ) | ||||
Accumulated deficit
|
(765,528 | ) | (681,795 | ) | ||||
|
|
|
|
|||||
Total stockholders’ equity
|
1,170,851 | 1,235,781 | ||||||
|
|
|
|
|||||
Total liabilities and stockholders’ equity
|
$ | 1,170,949 | $ | 1,235,879 | ||||
|
|
|
|
Year ended December 31,
|
||||||||||||
2020
|
2019
|
2018
|
||||||||||
Revenue
|
$ | — | $ | — | $ | — | ||||||
Cost of revenue
|
— | — | — | |||||||||
Operating expenses
|
— | — | — | |||||||||
Other income/(expense), net
|
— | — | — | |||||||||
Loss before income taxes
|
— | — | — | |||||||||
|
|
|
|
|||||||||
Provision for/(benefit from) income taxes
|
— | — | — | |||||||||
Equity in net loss of subsidiaries
|
(83,733 | ) | (91,761 | ) | (54,040 | ) | ||||||
|
|
|
|
|
|
|||||||
Net loss
|
$ | (83,733 | ) | $ | (91,761 | ) | $ | (54,040 | ) | |||
Other comprehensive income/(loss):
|
||||||||||||
Foreign currency translation gain/(loss)
|
1,165 | 1,376 | (307 | ) | ||||||||
|
|
|
|
|
|
|||||||
Comprehensive loss
|
$ | (82,568 | ) | $ | (90,385 | ) | $ | (54,347 | ) | |||
|
|
|
|
|
|
June 30,
2021 |
December 31,
2020 |
|||||||
Assets
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$ | 95,043 | $ | 65,265 | ||||
Restricted cash
|
105 | 205 | ||||||
Short-term investments
|
12,074 | — | ||||||
Accounts receivable, net of allowance of $1.3 million and $3.3 million, respectively
|
106,014 | 141,113 | ||||||
Capitalized commission, net
|
20,982 | 22,000 | ||||||
Prepaid expenses and other current assets
|
15,988 | 12,415 | ||||||
|
|
|
|
|||||
Total current assets
|
250,206 | 240,998 | ||||||
Property and equipment, net
|
17,852 | 21,715 | ||||||
Capitalized software development costs, net
|
118,535 | 124,030 | ||||||
Intangible assets, net
|
247,118 | 272,416 | ||||||
Goodwill
|
1,617,944 | 1,605,628 | ||||||
Operating lease-right-of-use assets
|
34,088 | 38,922 | ||||||
Capitalized commission, net, non-current
|
19,427 | 20,427 | ||||||
Deferred tax assets, non-current
|
1,868 | 2,036 | ||||||
Other assets, non-current, net
|
4,129 | 5,479 | ||||||
|
|
|
|
|||||
Total assets
|
$ | 2,311,167 | $ | 2,331,651 | ||||
|
|
|
|
|||||
Liabilities and Stockholders’ Equity
|
||||||||
Current liabilities:
|
||||||||
Current portion of long-term debt
|
$ | 4,537 | $ | 17,920 | ||||
Accounts payable
|
6,449 | 4,078 | ||||||
Accrued expenses and other current liabilities
|
64,619 | 81,939 | ||||||
Fees payable to customers
|
26,739 | 16,872 | ||||||
Operating lease liabilities, current
|
15,492 | 15,910 | ||||||
Deferred revenue
|
241,649 | 207,622 | ||||||
|
|
|
|
|||||
Total current liabilities
|
359,485 | 344,341 | ||||||
Deferred tax liabilities, non-current
|
17,627 | 16,950 | ||||||
Long-term debt, net
|
751,680 | 753,953 | ||||||
Operating lease liabilities, non-current
|
34,233 | 40,317 | ||||||
Other liabilities, non-current
|
7,225 | 5,239 | ||||||
|
|
|
|
|||||
Total liabilities
|
1,170,250 | 1,160,800 | ||||||
Commitments and contingencies (Note 13)
|
||||||||
Stockholders’ equity:
|
||||||||
Common stock, $0.001 par value, 1,100,000 shares authorized at June 30, 2021 and December 31, 2020; 917,761 and 917,365 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively
|
1 | 1 | ||||||
Additional paid-in capital
|
1,945,267 | 1,936,447 | ||||||
Accumulated other comprehensive loss
|
(414 | ) | (69 | ) | ||||
Accumulated deficit
|
(803,937 | ) | (765,528 | ) | ||||
|
|
|
|
|||||
Total stockholders’ equity
|
1,140,917 | 1,170,851 | ||||||
|
|
|
|
|||||
Total liabilities and stockholders’ equity
|
$ | 2,311,167 | $ | 2,331,651 | ||||
|
|
|
|
Three Months Ended
June 30, |
Six Months Ended
June 30, |
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
Revenue
|
$ | 122,814 | $ | 125,158 | $ | 240,101 | $ | 264,708 | ||||||||
Cost of revenue
|
45,999 | 42,485 | 89,844 | 94,446 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Gross profit
|
76,815 | 82,673 | 150,257 | 170,262 | ||||||||||||
Operating expenses:
|
||||||||||||||||
Sales and marketing
|
33,070 | 32,474 | 61,907 | 70,539 | ||||||||||||
Research and development
|
24,657 | 22,875 | 46,331 | 48,021 | ||||||||||||
General and administrative
|
21,600 | 20,446 | 38,354 | 43,638 | ||||||||||||
Intangible asset amortization, exclusive of amounts included in cost of revenue
|
12,929 | 13,468 | 25,964 | 26,925 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total operating expenses
|
92,256 | 89,263 | 172,556 | 189,123 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Loss from operations
|
(15,441 | ) | (6,590 | ) | (22,299 | ) | (18,861 | ) | ||||||||
Interest expense
|
(7,638 | ) | (8,828 | ) | (15,171 | ) | (19,544 | ) | ||||||||
Amortization of deferred financing costs and debt discount
|
(941 | ) | (951 | ) | (1,884 | ) | (1,904 | ) | ||||||||
Loss on divestitures, net
|
— | (9,634 | ) | — | (9,634 | ) | ||||||||||
Other income, net
|
3,998 | 20 | 4,271 | 1,457 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Loss before income taxes
|
(20,022 | ) | (25,983 | ) | (35,083 | ) | (48,486 | ) | ||||||||
Provision for income taxes
|
1,825 | 2,018 | 3,325 | 4,222 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Net loss
|
$ | (21,847 | ) | $ | (28,001 | ) | $ | (38,408 | ) | $ | (52,708 | ) | ||||
|
|
|
|
|
|
|
|
|||||||||
Other comprehensive loss:
|
||||||||||||||||
Foreign currency translation gain/(loss)
|
276 | 1,599 | (345 | ) | (3,715 | ) | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Comprehensive loss
|
$ | (21,571 | ) | $ | (26,402 | ) | $ | (38,753 | ) | $ | (56,423 | ) | ||||
|
|
|
|
|
|
|
|
|||||||||
Basic and Diluted net loss per common share
|
$ | (23.80 | ) | $ | (30.53 | ) | $ | (41.86 | ) | $ | (57.47 | ) | ||||
|
|
|
|
|
|
|
|
|||||||||
Basic and Diluted weighted-average common shares outstanding
|
917,745 | 917,074 | 917,580 | 917,080 | ||||||||||||
|
|
|
|
|
|
|
|
Common Stock
|
Amount
|
|||||||||||||||||||||||
Shares
|
Amount
|
Additional
paid-in capital |
Accumulated
deficit |
Accumulated
other comprehensive income / (loss) |
Total
stockholders’ equity |
|||||||||||||||||||
Balance as of December 31, 2020
|
917,365 | $ | 1 | $ | 1,936,447 | $ | (765,528 | ) | $ | (69 | ) | $ | 1,170,851 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Stock-based compensation
|
— | — | 609 | — | — | 609 | ||||||||||||||||||
Net loss
|
— | — | — | (16,562 | ) | — | (16,562 | ) | ||||||||||||||||
Exercise of stock options
|
268 | — | 318 | — | — | 318 | ||||||||||||||||||
Repurchase of stock options
|
(53 | ) | — | (122 | ) | — | — | (122 | ) | |||||||||||||||
Foreign currency translation loss
|
— | — | — | — | (621 | ) | (621 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance as of March 31, 2021
|
917,580 | $ | 1 | $ | 1,937,252 | $ | (782,090 | ) | $ | (690 | ) | $ | 1,154,473 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Stock-based compensation
|
— | — | 7,815 | — | — | 7,815 | ||||||||||||||||||
Net loss
|
— | — | — | (21,847 | ) | — | (21,847 | ) | ||||||||||||||||
Exercise of stock options
|
181 | — | 200 | — | — | 200 | ||||||||||||||||||
Foreign currency translation loss
|
— | — | — | — | 276 | 276 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance as of June 30, 2021
|
917,761 | $ | 1 | $ | 1,945,267 | $ | (803,937 | ) | $ | (414 | ) | $ | 1,140,917 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Common Stock
|
Amount
|
|||||||||||||||||||||||
Shares
|
Amount
|
Additional
paid-in capital |
Accumulated
deficit |
Accumulated
other comprehensive income / (loss) |
Total
stockholders’ equity |
|||||||||||||||||||
Balance as of December 31, 2019
|
917,085 | $ | 1 | $ | 1,918,809 | $ | (681,795 | ) | $ | (1,234 | ) | $ | 1,235,781 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Stock-based compensation
|
— | — | 4,847 | — | — | 4,847 | ||||||||||||||||||
Net loss
|
— | — | — | (24,706 | ) | — | (24,706 | ) | ||||||||||||||||
Foreign currency translation gain
|
— | — | — | — | (5,314 | ) | (5,314 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance as of March 31, 2020
|
917,085 | $ | 1 | $ | 1,923,656 | $ | (706,501 | ) | $ | (6,548 | ) | $ | 1,210,608 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Stock-based compensation
|
— | — | 4,831 | — | — | 4,831 | ||||||||||||||||||
Net loss
|
— | — | — | (28,001 | ) | — | (28,001 | ) | ||||||||||||||||
Exercise of stock options
|
28 | — | 61 | — | — | 61 | ||||||||||||||||||
Repurchase of stock options
|
(55 | ) | — | (71 | ) | — | — | (71 | ) | |||||||||||||||
Foreign currency translation gain
|
— | — | — | — | 1,599 | 1,599 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance as of June 30, 2020
|
917,058 | 1 | $ | 1,928,477 | $ | (734,502 | ) | $ | (4,949 | ) | $ | 1,189,027 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30,
|
||||||||
2021
|
2020
|
|||||||
Operating activities:
|
||||||||
Net loss
|
$ | (38,408 | ) | $ | (52,708 | ) | ||
Adjustments to reconcile net loss to net cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
62,341 | 63,808 | ||||||
Amortization of the right-of-use assets
|
4,849 | 4,653 | ||||||
Allowance for expected credit losses, net
|
1,118 | 310 | ||||||
Amortization of deferred financing costs and debt discount
|
1,884 | 1,904 | ||||||
Amortization of capitalized commission
|
14,206 | 14,941 | ||||||
Unrealized foreign currency transaction gain
|
24 | 117 | ||||||
Stock-based compensation
|
8,423 | 9,678 | ||||||
Loss on divestiture
|
— | 9,634 | ||||||
Change in deferred taxes
|
845 | 1,099 | ||||||
Change in operating assets and liabilities, net of acquired assets and liabilities:
|
||||||||
Accounts receivable
|
34,130 | 24,548 | ||||||
Prepaid expenses and other assets
|
(5,774 | ) | 3,367 | |||||
Capitalized commission, net
|
(19,114 | ) | (17,330 | ) | ||||
Accounts payable, accrued expenses and other liabilities
|
4,211 | (26,622 | ) | |||||
Operating lease liability
|
(6,484 | ) | (5,576 | ) | ||||
Deferred revenue
|
33,347 | 14,996 | ||||||
|
|
|
|
|||||
Net cash provided by operating activities
|
95,598 | 46,819 | ||||||
Investing activities:
|
||||||||
Purchase of property and equipment
|
(1,982 | ) | (575 | ) | ||||
Capitalized software development costs
|
(19,449 | ) | (23,149 | ) | ||||
Purchase of short-term investments
|
(31,399 | ) | (26,739 | ) | ||||
Maturities of short-term investments
|
19,325 | 19,348 | ||||||
Proceeds from divestiture
|
— | 500 | ||||||
Acquisitions, net of cash acquired
|
(14,769 | ) | (1,400 | ) | ||||
|
|
|
|
|||||
Net cash used in investing activities
|
(48,274 | ) | (32,015 | ) | ||||
Financing activities:
|
||||||||
Principal repayments on first lien term loan
|
(3,967 | ) | (3,967 | ) | ||||
Principal repayments of revolving credit facility
|
(13,400 | ) | (500 | ) | ||||
Proceeds from revolving credit facility
|
— | 40,000 | ||||||
Proceeds from exercise of stock options
|
522 | 61 | ||||||
|
|
|
|
|||||
Repurchase of stock
|
(57 | ) | — | |||||
|
|
|
|
|||||
Net cash provided by financing activities
|
(16,902 | ) | 35,594 | |||||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
|
(744 | ) | (3,301 | ) | ||||
|
|
|
|
|||||
Change in cash, cash equivalents, and restricted cash
|
29,678 | 47,097 | ||||||
Cash, cash equivalents, and restricted cash, beginning of period
|
65,470 | 72,721 | ||||||
|
|
|
|
|||||
Cash, cash equivalents, and restricted cash, end of period
|
$ | 95,148 | $ | 119,818 | ||||
|
|
|
|
|||||
Supplemental cash flow information:
|
||||||||
Interest paid
|
$ | 15,181 | $ | 19,531 | ||||
Income taxes paid
|
$ | 3,479 | $ | 2,223 | ||||
|
|
|
|
|||||
Supplemental disclosure of non-cash investing and financing activities:
|
||||||||
Outstanding payments for purchase of property and equipment at period end
|
$ | 394 | $ | 642 | ||||
Outstanding payments for capitalized software development costs at period end
|
$ | 845 | $ | 496 | ||||
|
|
|
|
June 30,
|
December 31,
|
|||||||
2021
|
2020
|
|||||||
Cash and cash equivalents
|
$ | 95,043 | $ | 65,265 | ||||
Restricted cash
|
105 | 205 | ||||||
|
|
|
|
|||||
Cash, cash equivalents, and restricted cash
|
$ | 95,148 | $ | 65,470 | ||||
|
|
|
|
June 30,
|
December 31,
|
|||||||
2021
|
2020
|
|||||||
North America
|
$ | 13,595 | $ | 16,976 | ||||
Non-North America
|
4,257 | 4,739 | ||||||
|
|
|
|
|||||
Total
|
$ | 17,852 | $ | 21,715 | ||||
|
|
|
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
North America
|
$ | 106,465 | 109,719 | $ | 207,747 | 232,852 | ||||||||||
Non-North America
|
16,349 | 15,439 | 32,354 | 31,856 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Revenue
|
$ | 122,814 | 125,158 | $ | 240,101 | 264,708 | ||||||||||
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
Six Months Ended June 30,
|
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
Event Cloud
|
$ | 85,590 | 76,703 | $ | 166,723 | 165,158 | ||||||||||
Hospitality Cloud
|
37,224 | 48,455 | 73,378 | 99,550 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Revenue
|
$ | 122,814 | 125,158 | $ | 240,101 | 264,708 | ||||||||||
|
|
|
|
|
|
|
|
June 30,
|
December 31,
|
|||||||
2021
|
2020
|
|||||||
Allowance for expected credit losses, beginning of period
|
$ | 3,287 | $ | 1,912 | ||||
Credit loss expense
|
1,118 | 3,280 | ||||||
Write-offs and adjustments
|
(3,087 | ) | (1,905 | ) | ||||
|
|
|
|
|||||
Allowance for expected credit losses, end of period
|
$ | 1,318 | $ | 3,287 | ||||
|
|
|
|
Cash and cash equivalents
|
$ | 176 | ||
Other current assets
|
149 | |||
Non-current assets
|
83 | |||
Current liabilities
|
(801 | ) | ||
Non-current liabilities
|
(55 | ) | ||
Trademarks
|
401 | |||
Developed technology
|
4,933 | |||
Goodwill
|
12,063 | |||
|
|
|||
Total purchase consideration
|
$ | 16,949 | ||
|
|
Fair value
acquired |
Useful life
(years) |
|||||||
Trademarks
|
$ | 401 | 2 | |||||
Developed technology
|
4,933 | 3 | ||||||
|
|
|||||||
Total intangible assets
|
$ | 5,334 | ||||||
|
|
June 30,
|
December 31,
|
|||||||
2021
|
2020
|
|||||||
Computer equipment, purchased software and software developed for internal-use
|
$ | 23,577 | $ | 22,408 | ||||
Leasehold improvements
|
25,850 | 26,675 | ||||||
Furniture and equipment
|
11.086 | 11,075 | ||||||
Rentable onsite solutions equipment
|
6,325 | 6,326 | ||||||
Other
|
868 | 66 | ||||||
|
|
|
|
|||||
Property and equipment, gross
|
67,706 | 66,650 | ||||||
Less accumulated depreciation
|
(49,854 | ) | (44,835 | ) | ||||
|
|
|
|
|||||
Property and equipment, net
|
$ | 17,852 | $ | 21,715 | ||||
|
|
|
|
June 30,
|
December 31,
|
|||||||
2021
|
2020
|
|||||||
Capitalized software development costs, gross
|
$ | 363,998 | $ | 339,082 | ||||
Less accumulated amortization
|
(245,463 | ) | (215,052 | ) | ||||
|
|
|
|
|||||
Capitalized software development costs, net
|
$ | 118,535 | $ | 124,030 | ||||
|
|
|
|
Goodwill as of January 1, 2021
|
$ | 1,605,628 | ||
Foreign currency translation adjustments
|
253 | |||
Addition from acquisition (Note 4)
|
12,063 | |||
|
|
|||
Goodwill as of June 30, 2021
|
$ | 1,617,944 | ||
|
|
Intangible Assets, Gross
|
Accumulated Amortization
|
Intangible Assets, Net
|
||||||||||||||||||||||||||||||||||
January 1,
2021 |
Additions
and retirements |
June 30,
2021 |
January 1,
2021 |
Expense
and retirements, net |
June 30,
2021 |
January 1,
2021 |
June 30,
2021 |
Weighted
average remaining life as of June 30, 2021 |
||||||||||||||||||||||||||||
Customer relationships
|
$ | 437,999 | $ | 482 | $ | 438,481 | $ | (214,923 | ) | $ | (21,463 | ) | $ | (236,386 | ) | $ | 223,076 | $ | 202,095 | 5.5 years | ||||||||||||||||
Trademarks
|
96,501 | 405 | 96,906 | (47,223 | ) | (4,722 | ) | (51,945 | ) | 49,278 | 44,961 | 5.1 years | ||||||||||||||||||||||||
Non-compete agreements
|
588 | — | 588 | (588 | ) | — | (588 | ) | — | — | — | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Intangible assets subject to amortization
|
$ | 535,088 | $ | 887 | $ | 535,975 | $ | (262,734 | ) | $ | (26,185 | ) | $ | (288,919 | ) | $ | 272,354 | $ | 247,056 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Indefinite-lived assets
|
62 | — | 62 | — | — | — | 62 | 62 | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Intangible assets, net
|
$ | 535,150 | $ | 887 | $ | 536,037 | $ | (262,734 | ) | $ | (26,185 | ) | $ | (288,919 | ) | $ | 272,416 | $ | 247,118 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible Assets, Gross
|
Accumulated Amortization
|
Intangible Assets, Net
|
||||||||||||||||||||||||||||||||||
January 1,
2020 |
Additions
and retirements |
December 31,
2020 |
January 1,
2020 |
Expense
and retirements, net |
December 31,
2020 |
January 1,
2020 |
December 31,
2020 |
Weighted
average remaining life as of December 31, 2020 |
||||||||||||||||||||||||||||
Customer relationships
|
$ | 436,182 | $ | 1,817 | $ | 437,999 | $ | (170,643 | ) | $ | (44,280 | ) | $ | (214,923 | ) | $ | 265,539 | $ | 223,076 | 5.6 years | ||||||||||||||||
Trademarks
|
97,185 | (684 | ) | 96,501 | (37,704 | ) | (9,519 | ) | (47,223 | ) | 59,481 | 49,278 | 5.2 years | |||||||||||||||||||||||
Non-compete agreements
|
588 | — | 588 | (588 | ) | — | (588 | ) | — | — | — | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Intangible assets subject to amortization
|
$ | 533,955 | $ | 1,133 | $ | 535,088 | $ | (208,935 | ) | $ | (53,799 | ) | $ | (262,734 | ) | $ | 325,020 | $ | 272,354 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Indefinite-lived assets
|
62 | — | 62 | — | — | — | 62 | 62 | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Intangible assets, net
|
$ | 534,017 | $ | 1,133 | $ | 535,150 | $ | (208,935 | ) | $ | (53,799 | ) | $ | (262,734 | ) | $ | 325,082 | $ | 272,416 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2021 (remaining six months)
|
$ | 25,535 | ||
2022
|
48,634 | |||
2023
|
46,725 | |||
2024
|
45,168 | |||
2025
|
39,318 | |||
Thereafter
|
41,676 | |||
|
|
|||
Total amortization expense related to acquired intangible assets
|
$ | 247,056 | ||
|
|
June 30,
|
December 31,
|
|||||||
2021
|
2020
|
|||||||
Accrued compensation
|
$ | 38,521 | $ | 50,312 | ||||
Sales and other tax liabilities
|
5,893 | 9,550 | ||||||
Other
|
20,205 | 22,077 | ||||||
|
|
|
|
|||||
Accrued expenses and other current liabilities
|
$ | 64,619 | $ | 81,939 | ||||
|
|
|
|
Three Months
Ended June 30, 2021 |
Six Months
Ended June 30, 2021 |
|||||||
Dividend yield
|
0.0 | % | 0.0 | % | ||||
Volatility
|
45.45 | % | 45.29 | % | ||||
Expected term (years)
|
5.88 | 5.89 | ||||||
Risk-free interest rate
|
1.32 | % | 1.85 | % |
Stock options
|
Number of
shares subject to option |
Weighted
average exercise price per share |
Weighted
average remaining contractual term (years) |
Aggregate
intrinsic value (in thousands) |
Unrecognized
compensation expense (in thousands) |
|||||||||||||||
Balance as of January 1, 2021
|
81,595 | $ | 1,698 | 6.08 | $ | 49,446 | $ | 2,708 | ||||||||||||
Granted
|
33,938 | 2,304 | ||||||||||||||||||
Exercised
|
(828 | ) | 1,706 | |||||||||||||||||
Forfeited
|
(327 | ) | 2,285 | |||||||||||||||||
Expired
|
(188 | ) | 1,710 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balance as of June 30, 2021
|
114,190 | $ | 1,876 | 6.80 | $ | 305,833 | $ | 57,633 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Vested and exercisable as of January 1, 2021
|
77,819 | $ | 1,671 | 6.43 | $ | 49,262 | $ | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Vested and exercisable as of June 30, 2021
|
95,755 | $ | 1,678 | 5.96 | $ | 275,496 | $ | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
Six Months Ended June 30
|
|||||||||||||||
2021
|
2020
|
2021
|
2020
|
|||||||||||||
Cost of revenue
|
$ | 435 | 155 | $ | 494 | 310 | ||||||||||
Sales and marketing
|
2,458 | 1,382 | 2,793 | 2,764 | ||||||||||||
Research and development
|
1,997 | 1,118 | 2,138 | 2,252 | ||||||||||||
General and administrative
|
2,925 | 2,176 | 2,998 | 4,352 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total stock-based compensation expense
|
$ | 7,815 | 4,831 | $ | 8,423 | 9,678 | ||||||||||
|
|
|
|
|
|
|
|
June 30,
2021 |
December 31,
2020 |
|||||||
First Lien Principal amount
|
$ | 767,680 | $ | 771,648 | ||||
Revolving Credit Facility Principal Amount
|
— | 13,400 | ||||||
Less: original issue discount
|
(1,481 | ) | (1,702 | ) | ||||
Less: unamortized deferred financing costs
|
(9,982 | ) | (11,473 | ) | ||||
|
|
|
|
|||||
Total principal amount and related unamortized debt issuance costs, net
|
$ | 756,217 | $ | 771,873 | ||||
|
|
|
|
2021 (remaining six months)
|
$ | 3,967 | ||
2022
|
7,935 | |||
2023
|
7,935 | |||
2024
|
747,843 | |||
|
|
|||
Total minimum principal payments on debt
|
$ | 767,680 | ||
|
|
P
AGE
|
||||||
ARTICLE 1 CERTAIN DEFINITIONS
|
A-3 | |||||
Section 1.1
|
Definitions | A-3 | ||||
ARTICLE 2 MERGERS
|
A-19 | |||||
Section 2.1
|
Closing Transactions | A-19 | ||||
Section 2.2
|
Closing of the Transactions Contemplated by this Agreement | A-21 | ||||
Section 2.3
|
Allocation Schedule | A-21 | ||||
Section 2.4
|
Treatment of Awards under the Company Equity Plan | A-21 | ||||
Section 2.5
|
Deliverables | A-22 | ||||
Section 2.6
|
Withholding | A-23 | ||||
Section 2.7
|
Dissenting Shares | A-23 | ||||
ARTICLE 3 REPRESENTATIONS AND WARRANTIES RELATING TO THE GROUP COMPANIES
|
A-24 | |||||
Section 3.1
|
Organization and Qualification | A-24 | ||||
Section 3.2
|
Capitalization of the Group Companies | A-24 | ||||
Section 3.3
|
Authority | A-25 | ||||
Section 3.4
|
Financial Statements; Undisclosed Liabilities | A-25 | ||||
Section 3.5
|
Consents and Requisite Governmental Approvals; No Violations | A-26 | ||||
Section 3.6
|
Permits | A-27 | ||||
Section 3.7
|
Material Contracts | A-27 | ||||
Section 3.8
|
Absence of Changes | A-28 | ||||
Section 3.9
|
Litigation | A-28 | ||||
Section 3.10
|
Compliance with Applicable Law | A-29 | ||||
Section 3.11
|
Employee Plans | A-29 | ||||
Section 3.12
|
Environmental Matters | A-30 | ||||
Section 3.13
|
Intellectual Property | A-30 | ||||
Section 3.14
|
Labor Matters | A-33 | ||||
Section 3.15
|
Insurance | A-34 | ||||
Section 3.16
|
Tax Matters | A-34 | ||||
Section 3.17
|
Brokers | A-35 | ||||
Section 3.18
|
Real and Personal Property | A-35 | ||||
Section 3.19
|
Transactions with Affiliates | A-35 | ||||
Section 3.20
|
Data Privacy and Security | A-36 | ||||
Section 3.21
|
Customers and Suppliers | A-37 | ||||
Section 3.22
|
Compliance with International Trade & Anti-Corruption Laws | A-38 | ||||
Section 3.23
|
Information Supplied | A-38 | ||||
Section 3.24
|
Investigation; No Other Representations | A-38 | ||||
Section 3.25
|
EXCLUSIVITY OF REPRESENTATIONS AND WARRANTIES | A-38 | ||||
ARTICLE 4 REPRESENTATIONS AND WARRANTIES RELATING TO THE DRAGONEER PARTIES
|
A-39 | |||||
Section 4.1
|
Organization and Qualification | A-39 | ||||
Section 4.2
|
Authority | A-39 | ||||
Section 4.3
|
Consents and Requisite Governmental Approvals; No Violations | A-40 | ||||
Section 4.4
|
Brokers | A-40 | ||||
Section 4.5
|
Information Supplied | A-40 | ||||
Section 4.6
|
Capitalization of the Dragoneer Parties | A-41 | ||||
Section 4.7
|
SEC Filings | A-42 |
P
AGE
|
||||||
Section 4.8
|
Trust Account | A-42 | ||||
Section 4.9
|
Transactions with Affiliates | A-43 | ||||
Section 4.10
|
Litigation | A-43 | ||||
Section 4.11
|
Compliance with Applicable Law | A-43 | ||||
Section 4.12
|
Business Activities | A-43 | ||||
Section 4.13
|
Internal Controls; Listing; Financial Statements | A-44 | ||||
Section 4.14
|
No Undisclosed Liabilities | A-45 | ||||
Section 4.15
|
Tax Matters | A-45 | ||||
Section 4.16
|
Investigation; No Other Representations | A-46 | ||||
Section 4.17
|
Compliance with International Trade & Anti-Corruption Laws | A-46 | ||||
Section 4.18
|
EXCLUSIVITY OF REPRESENTATIONS AND WARRANTIES | A-47 | ||||
ARTICLE 5 COVENANTS
|
A-47 | |||||
Section 5.1
|
Conduct of Business of the Company | A-47 | ||||
Section 5.2
|
Efforts to Consummate; Litigation | A-50 | ||||
Section 5.3
|
Confidentiality and Access to Information | A-52 | ||||
Section 5.4
|
Public Announcements | A-53 | ||||
Section 5.5
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Tax Matters | A-53 | ||||
Section 5.6
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Exclusive Dealing | A-54 | ||||
Section 5.7
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Preparation of Registration Statement / Proxy Statement | A-55 | ||||
Section 5.8
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Dragoneer Shareholder Approval | A-56 | ||||
Section 5.9
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Merger Sub Shareholder Approvals | A-57 | ||||
Section 5.10
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Conduct of Business of Dragoneer | A-57 | ||||
Section 5.11
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Nasdaq Listing | A-58 | ||||
Section 5.12
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Trust Account | A-58 | ||||
Section 5.13
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Transaction Support Agreements; Company Shareholder Approval; Investor Subscription Agreements; Forward Purchase Agreement; Shareholder Rights Agreements | A-59 | ||||
Section 5.14
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Dragoneer Indemnification; Directors’ and Officers’ Insurance | A-60 | ||||
Section 5.15
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Company Indemnification; Directors’ and Officers’ Insurance | A-61 | ||||
Section 5.16
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Post-Closing Directors and Officers | A-62 | ||||
Section 5.17
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PCAOB Financials | A-62 | ||||
Section 5.18
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FIRPTA Certificates | A-63 | ||||
Section 5.19
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Dragoneer Incentive Equity Plan | A-63 | ||||
Section 5.20
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Dragoneer Employee Stock Purchase Plan | A-63 | ||||
Section 5.21
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Section 16 Matters | A-63 | ||||
ARTICLE 6 CONDITIONS TO CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT
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A-63 | |||||
Section 6.1
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Conditions to the Obligations of the Parties | A-63 | ||||
Section 6.2
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Other Conditions to the Obligations of the Dragoneer Parties | A-64 | ||||
Section 6.3
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Other Conditions to the Obligations of the Company | A-65 | ||||
Section 6.4
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Frustration of Closing Conditions | A-65 | ||||
ARTICLE 7 TERMINATION
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A-66 | |||||
Section 7.1
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Termination | A-66 | ||||
Section 7.2
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Effect of Termination | A-66 |
P
AGE
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ARTICLE 8 MISCELLANEOUS
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A-67 | |||||
Section 8.1
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Non-Survival
|
A-67 | ||||
Section 8.2
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Entire Agreement; Assignment | A-67 | ||||
Section 8.3
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Amendment | A-67 | ||||
Section 8.4
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Notices | A-68 | ||||
Section 8.5
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Governing Law | A-68 | ||||
Section 8.6
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Fees and Expenses | A-69 | ||||
Section 8.7
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Construction; Interpretation | A-69 | ||||
Section 8.8
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Exhibits and Schedules | A-69 | ||||
Section 8.9
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Parties in Interest | A-70 | ||||
Section 8.10
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Severability | A-70 | ||||
Section 8.11
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Counterparts; Electronic Signatures | A-70 | ||||
Section 8.12
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Knowledge of Company; Knowledge of Dragoneer | A-70 | ||||
Section 8.13
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No Recourse | A-70 | ||||
Section 8.14
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Extension; Waiver | A-71 | ||||
Section 8.15
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Waiver of Jury Trial | A-71 | ||||
Section 8.16
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Submission to Jurisdiction | A-71 | ||||
Section 8.17
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Remedies | A-72 | ||||
Section 8.18
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Trust Account Waiver | A-72 |
Annex A | Investors | |
Exhibit A | Form of Sponsor Letter Agreement | |
Exhibit B | Form of Investor Subscription Agreement | |
Exhibit
C-1
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Form of Amended and Restated Registration Rights Agreement | |
Exhibit
C-2
|
Form of Investor Rights Agreement | |
Exhibit D | Form of Transaction Support Agreement | |
Exhibit E | Form of Dragoneer Certificate of Incorporation | |
Exhibit F | Form of Dragoneer Bylaws | |
Exhibit G | Form of Merger Sub I Certificate of Merger | |
Exhibit H | Form of Merger Sub II Certificate of Merger |
(a) |
If to any Dragoneer Party, to:
|
(b) |
If to the Company, to:
|
DRAGONEER GROWTH OPPORTUNITIES CORP. II
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By: |
/s/ Pat Robertson
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Name: | Pat Robertson | |
Title: | President and Chief Operating Officer | |
REDWOOD OPPORTUNITY MERGER SUB, INC.
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||
By: |
/s/ Pat Robertson
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Name: | Pat Robertson | |
Title: | President, Secretary and Treasurer | |
REDWOOD MERGER SUB LLC
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By: |
/s/ Pat Robertson
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Name: | Pat Robertson | |
Title: | President, Secretary and Treasurer |
PAPAY TOPCO, INC.
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By: |
/s/ Rajeev K. Aggarwal
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Name:
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Rajeev K. Aggarwal
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Title:
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Chief Executive Officer
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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1 |
The name of the Company is
Dragoneer Growth Opportunities Corp. II
|
2 |
The Registered Office of the Company shall be at the offices of Maples Corporate Services Limited, PO Box 309, Ugland House, Grand Cayman,
KY1-1104,
Cayman Islands, or at such other place within the Cayman Islands as the Directors may decide.
|
3 |
The objects for which the Company is established are unrestricted and the Company shall have full power and authority to carry out any object not prohibited by the laws of the Cayman Islands.
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4 |
The liability of each Member is limited to the amount unpaid on such Member’s shares.
|
5 |
The share capital of the Company is US$22,100 divided into 200,000,000 Class A ordinary shares of a par value of US$0.0001 each, 20,000,000 Class B ordinary shares of a par value of US$0.0001 each and 1,000,000 preference shares of a par value of US$0.0001 each.
|
6 |
The Company has power to register by way of continuation as a body corporate limited by shares under the laws of any jurisdiction outside the Cayman Islands and to be deregistered in the Cayman Islands.
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7 |
Capitalised terms that are not defined in this Amended and Restated Memorandum of Association bear the respective meanings given to them in the Amended and Restated Articles of Association of the Company.
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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1
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Interpretation
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1.1 |
In the Articles Table A in the First Schedule to the Statute does not apply and, unless there is something in the subject or context inconsistent therewith:
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|
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“
Affiliate
|
in respect of a person, means any other person that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such person, and (a) in the case of a natural person, shall include, without limitation, such person’s spouse, parents, children, siblings,
mother-in-law
father-in-law
sisters-in-law,
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“
Applicable Law
|
means, with respect to any person, all provisions of laws, statutes, ordinances, rules, regulations, permits, certificates, judgments, decisions, decrees or orders of any governmental authority applicable to such person. | |
|
|
|
“
Articles
|
means these amended and restated articles of association of the Company. | |
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|
|
“
Audit Committee
|
means the audit committee of the board of directors of the Company established pursuant to the Articles, or any successor committee. | |
“
Auditor
|
means the person for the time being performing the duties of auditor of the Company (if any). | |
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|
|
“
Business Combination
|
means a merger, amalgamation, share exchange, asset acquisition, share purchase, reorganisation or similar business combination |
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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involving the Company, with one or more businesses or entities (the “
target business
|
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“
business day
|
means any day other than a Saturday, a Sunday or a legal holiday or a day on which banking institutions or trust companies are authorised or obligated by law to close in New York City. | |
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|
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“
Clearing House
|
means a clearing house recognised by the laws of the jurisdiction in which the Shares (or depositary receipts therefor) are listed or quoted on a stock exchange or interdealer quotation system in such jurisdiction. | |
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“
Class A Share
|
means a Class A ordinary share of a par value of US$0.0001 in the share capital of the Company. | |
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“
Class B Share
|
means a Class B ordinary share of a par value of US$0.0001 in the share capital of the Company. | |
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|
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“
Company
|
means the above named company. | |
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“
Company’s Website
|
means the website of the Company and/or its
web-address
or domain name (if any).
|
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“
Compensation Committee
|
means the compensation committee of the board of directors of the Company established pursuant to the Articles, or any successor committee. | |
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“
Designated Stock Exchange
|
means any United States national securities exchange on which the securities of the Company are listed for trading, including The Nasdaq Capital Market. | |
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“
Directors
|
means the directors for the time being of the Company. | |
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“
Dividend
|
means any dividend (whether interim or final) resolved to be paid on Shares pursuant to the Articles. | |
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|
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“
Electronic Communication
|
means a communication sent by electronic means, including electronic posting to the Company’s Website, transmission to any number, address or internet website (including the website of the Securities and Exchange Commission) or other electronic delivery methods as otherwise decided and approved by the Directors. |
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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“
Electronic Record
|
has the same meaning as in the Electronic Transactions Law. | |
“
Electronic Transactions Law
|
means the Electronic Transactions Law (2003 Revision) of the Cayman Islands. | |
“
Equity-linked Securities
|
means any debt or equity securities that are convertible, exercisable or exchangeable for Class A Shares issued in a financing transaction in connection with a Business Combination, including but not limited to a private placement of equity or debt. | |
“
Exchange Act
|
means the United States Securities Exchange Act of 1934, as amended, or any similar U.S. federal statute and the rules and regulations of the Securities and Exchange Commission thereunder, all as the same shall be in effect at the time. | |
“
Founders
|
means all Members immediately prior to the consummation of the IPO. | |
“
Independent Director
|
has the same meaning as in the rules and regulations of the Designated Stock Exchange or in Rule
10A-3
under the Exchange Act, as the case may be.
|
|
“
IPO
|
means the Company’s initial public offering of securities. | |
“
Member
|
has the same meaning as in the Statute. | |
“
Memorandum
|
means the amended and restated memorandum of association of the Company. | |
“
Nominating Committee
|
means the nominating committee of the board of directors of the Company established pursuant to the Articles, or any successor committee. | |
“
Officer
|
means a person appointed to hold an office in the Company. | |
“
Ordinary Resolution
|
means a resolution passed by a simple majority of the Members as, being entitled to do so, vote in person or, where proxies are allowed, by proxy at a general meeting, and includes a unanimous written resolution. In computing the majority when a poll is demanded regard shall be had to the number of votes to which each Member is entitled by the Articles. | |
“
Over-Allotment Option
|
means the option of the Underwriters to purchase up to an additional 15 per cent of the Class A Ordinary Shares issued in the IPO at a price equal to US$10 per unit, less underwriting discounts and commissions. | |
“
Preference Share
|
means a preference share of a par value of US$0.0001 in the share capital of the Company. | |
“
Public Share
|
means a Class A Share issued in the IPO. |
www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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“
Redemption Notice
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means a notice in a form approved by the Company by which a holder of Public Shares is entitled to require the Company to redeem its Public Shares, subject to any conditions contained therein. | |
“
Register of Members
|
means the register of Members maintained in accordance with the Statute and includes (except where otherwise stated) any branch or duplicate register of Members. | |
“
Registered Office
|
means the registered office for the time being of the Company. | |
“
Representative
|
means a representative of the Underwriters. | |
“
Seal
|
means the common seal of the Company and includes every duplicate seal. | |
“
Securities and Exchange Commission
|
means the United States Securities and Exchange Commission. | |
“
Share
|
means a Class A Share, a Class B Share or a Preference Share and includes a fraction of a share in the Company. | |
“
Special Resolution
|
subject to Article 29.4, Article 47.1 and Article 47.2, has the same meaning as in the Statute, and includes a unanimous written resolution. | |
“
Sponsor
|
means Dragoneer Growth Opportunities Holdings II, a Cayman Islands limited liability company, and its successors or assigns. | |
“
Statute
|
means the Companies Law (2020 Revision) of the Cayman Islands. | |
“
Treasury Share
|
means a Share held in the name of the Company as a treasury share in accordance with the Statute. | |
“
Trust Account
|
means the trust account established by the Company upon the consummation of its IPO and into which a certain amount of the net proceeds of the IPO will be deposited. | |
“
Underwriter
|
means an underwriter of the IPO from time to time and any successor underwriter. |
1.2 |
In the Articles:
|
(a) |
words importing the singular number include the plural number and vice versa;
|
(b) |
words importing the masculine gender include the feminine gender;
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(c) |
words importing persons include corporations as well as any other legal or natural person;
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(d) |
“written” and “in writing” include all modes of representing or reproducing words in visible form, including in the form of an Electronic Record;
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(e) |
“shall” shall be construed as imperative and “may” shall be construed as permissive;
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(f) |
references to provisions of any law or regulation shall be construed as references to those provisions as amended, modified,
re-enacted
or replaced;
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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(g) |
any phrase introduced by the terms “including”, “include”, “in particular” or any similar expression shall be construed as illustrative and shall not limit the sense of the words preceding those terms;
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(h) |
the term “and/or” is used herein to mean both “and” as well as “or.” The use of “and/or” in certain contexts in no respects qualifies or modifies the use of the terms “and” or “or” in others. The term “or” shall not be interpreted to be exclusive and the term “and” shall not be interpreted to require the conjunctive (in each case, unless the context otherwise requires);
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(i) |
headings are inserted for reference only and shall be ignored in construing the Articles;
|
(j) |
any requirements as to delivery under the Articles include delivery in the form of an Electronic Record;
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(k) |
any requirements as to execution or signature under the Articles including the execution of the Articles themselves can be satisfied in the form of an electronic signature as defined in the Electronic Transactions Law;
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(l) |
sections 8 and 19(3) of the Electronic Transactions Law shall not apply;
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(m) |
the term “clear days” in relation to the period of a notice means that period excluding the day when the notice is received or deemed to be received and the day for which it is given or on which it is to take effect; and
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(n) |
the term “holder” in relation to a Share means a person whose name is entered in the Register of Members as the holder of such Share.
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2
|
Commencement of Business
|
2.1 |
The business of the Company may be commenced as soon after incorporation of the Company as the Directors shall see fit.
|
2.2 |
The Directors may pay, out of the capital or any other monies of the Company, all expenses incurred in or about the formation and establishment of the Company, including the expenses of registration.
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3
|
Issue of Shares and other Securities
|
3.1 |
Subject to the provisions, if any, in the Memorandum (and to any direction that may be given by the Company in general meeting) and, where applicable, the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law, and without prejudice to any rights attached to any existing Shares, the Directors may allot, issue, grant options over or otherwise dispose of Shares (including fractions of a Share) with or without preferred, deferred or other rights or restrictions, whether in regard to Dividends or other distributions, voting, return of capital or otherwise and to such persons, at such times and on such other terms as they think proper, and may also (subject to the Statute and the Articles) vary such rights, save that the Directors shall not allot, issue, grant options over or otherwise dispose of Shares (including fractions of a Share) to the extent that it may affect the ability of the Company to carry out a Class B Share Conversion set out in the Articles.
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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3.2 |
The Company may issue rights, options, warrants or convertible securities or securities of similar nature conferring the right upon the holders thereof to subscribe for, purchase or receive any class of Shares or other securities in the Company on such terms as the Directors may from time to time determine.
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3.3 |
The Company may issue units of securities in the Company, which may be comprised of whole or fractional Shares, rights, options, warrants or convertible securities or securities of similar nature conferring the right upon the holders thereof to subscribe for, purchase or receive any class of Shares or other securities in the Company, upon such terms as the Directors may from time to time determine.
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3.4 |
The Company shall not issue Shares to bearer.
|
4
|
Register of Members
|
4.1 |
The Company shall maintain or cause to be maintained the Register of Members in accordance with the Statute.
|
4.2 |
The Directors may determine that the Company shall maintain one or more branch registers of Members in accordance with the Statute. The Directors may also determine which register of Members shall constitute the principal register and which shall constitute the branch register or registers, and to vary such determination from time to time.
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5
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Closing Register of Members or Fixing Record Date
|
5.1 |
For the purpose of determining Members entitled to notice of, or to vote at any meeting of Members or any adjournment thereof, or Members entitled to receive payment of any Dividend or other distribution, or in order to make a determination of Members for any other purpose, the Directors may, after notice has been given by advertisement in an appointed newspaper or any other newspaper or by any other means in accordance with the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law, provide that the Register of Members shall be closed for transfers for a stated period which shall not in any case exceed forty days.
|
5.2 |
In lieu of, or apart from, closing the Register of Members, the Directors may fix in advance or arrears a date as the record date for any such determination of Members entitled to notice of, or to vote at any meeting of the Members or any adjournment thereof, or for the purpose of determining the Members entitled to receive payment of any Dividend or other distribution, or in order to make a determination of Members for any other purpose.
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5.3 |
If the Register of Members is not so closed and no record date is fixed for the determination of Members entitled to notice of, or to vote at, a meeting of Members or Members entitled to receive payment of a Dividend or other distribution, the date on which notice of the meeting is sent or the date on which the resolution of the Directors resolving to pay such Dividend or other distribution is passed, as the case may be, shall be the record date for such determination of Members. When a determination of Members entitled to vote at any meeting of Members has been made as provided in this Article, such determination shall apply to any adjournment thereof.
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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6
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Certificates for Shares
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6.1 |
A Member shall only be entitled to a share certificate if the Directors resolve that share certificates shall be issued. Share certificates representing Shares, if any, shall be in such form as the Directors may determine. Share certificates shall be signed by one or more Directors or other person authorised by the Directors. The Directors may authorise certificates to be issued with the authorised signature(s) affixed by mechanical process. All certificates for Shares shall be consecutively numbered or otherwise identified and shall specify the Shares to which they relate. All certificates surrendered to the Company for transfer shall be cancelled and, subject to the Articles, no new certificate shall be issued until the former certificate representing a like number of relevant Shares shall have been surrendered and cancelled.
|
6.2 |
The Company shall not be bound to issue more than one certificate for Shares held jointly by more than one person and delivery of a certificate to one joint holder shall be a sufficient delivery to all of them.
|
6.3 |
If a share certificate is defaced, worn out, lost or destroyed, it may be renewed on such terms (if any) as to evidence and indemnity and on the payment of such expenses reasonably incurred by the Company in investigating evidence, as the Directors may prescribe, and (in the case of defacement or wearing out) upon delivery of the old certificate.
|
6.4 |
Every share certificate sent in accordance with the Articles will be sent at the risk of the Member or other person entitled to the certificate. The Company will not be responsible for any share certificate lost or delayed in the course of delivery.
|
6.5 |
Share certificates shall be issued within the relevant time limit as prescribed by the Statute, if applicable, or as the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law may from time to time determine, whichever is shorter, after the allotment or, except in the case of a Share transfer which the Company is for the time being entitled to refuse to register and does not register, after lodgement of a Share transfer with the Company.
|
7
|
Transfer of Shares
|
7.1 |
Subject to the terms of the Articles, any Member may transfer all or any of his Shares by an instrument of transfer provided that such transfer complies with the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law.
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7.2 |
The instrument of transfer of any Share shall be in writing in the usual or common form or in a form prescribed by the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law or in any other form approved by the Directors and shall be executed by or on behalf of the transferor (and if the Directors so require, signed by or on behalf of the transferee) and may be under hand or, if the transferor or transferee is a Clearing House or its nominee(s), by hand or by machine imprinted signature or by such other manner of execution as the Directors may approve from time to time. The transferor shall be deemed to remain the holder of a Share until the name of the transferee is entered in the Register of Members.
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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8
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Redemption, Repurchase and Surrender of Shares
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8.1 |
Subject to the provisions of the Statute, and, where applicable, the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law, the Company may issue Shares that are to be redeemed or are liable to be redeemed at the option of the Member or the Company. The redemption of such Shares, except Public Shares, shall be effected in such manner and upon such other terms as the Company may, by Special Resolution, determine before the issue of such Shares. With respect to redeeming or repurchasing the Shares:
|
(a) |
Members who hold Public Shares are entitled to request the redemption of such Shares in the circumstances described in the Business Combination Article hereof;
|
(b) |
Class B Shares held by the Sponsor shall be surrendered by the Sponsor for no consideration to the extent that the Over-Allotment Option is not exercised in full so that the Founders will own 20 per cent of the Company’s issued Shares after the IPO (exclusive of any securities purchased in a private placement simultaneously with the IPO); and
|
(c) |
Public Shares may be repurchased by way of tender offer in the circumstances set out in the Business Combination Article hereof.
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8.2 |
Subject to the provisions of the Statute, and, where applicable, the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law, the Company may purchase its own Shares (including any redeemable Shares) in such manner and on such other terms as the Directors may agree with the relevant Member. For the avoidance of doubt, redemptions, repurchases and surrenders of Shares in the circumstances described in the Article above shall not require further approval of the Members.
|
8.3 |
The Company may make a payment in respect of the redemption or purchase of its own Shares in any manner permitted by the Statute, including out of capital.
|
8.4 |
The Directors may accept the surrender for no consideration of any fully paid Share.
|
9
|
Treasury Shares
|
9.1 |
The Directors may, prior to the purchase, redemption or surrender of any Share, determine that such Share shall be held as a Treasury Share.
|
9.2 |
The Directors may determine to cancel a Treasury Share or transfer a Treasury Share on such terms as they think proper (including, without limitation, for nil consideration).
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10
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Variation of Rights of Shares
|
10.1 |
Subject to Article 3.1, if at any time the share capital of the Company is divided into different classes of Shares, all or any of the rights attached to any class (unless otherwise provided by the terms of issue of the Shares of that class) may, whether or not the Company is being wound up, be varied without the consent of the holders of the issued Shares of that class where such variation is considered by the Directors not to have a material adverse effect upon such rights; otherwise, any such variation shall be made only with the consent in writing of the holders of not less than two thirds of the issued Shares of
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www.verify.gov.ky File#: 366479
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Filed:
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Auth Code: J29695536021
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that class (other than with respect to a waiver of the provisions of the Class B Share Conversion Article hereof, which as stated therein shall only require the consent in writing of the holders of a majority of the issued Shares of that class), or with the approval of a resolution passed by a majority of not less than two thirds of the votes cast at a separate meeting of the holders of the Shares of that class. For the avoidance of doubt, the Directors reserve the right, notwithstanding that any such variation may not have a material adverse effect, to obtain consent from the holders of Shares of the relevant class. To any such meeting all the provisions of the Articles relating to general meetings shall apply
mutatis mutandis
|
10.2 |
For the purposes of a separate class meeting, the Directors may treat two or more or all the classes of Shares as forming one class of Shares if the Directors consider that such class of Shares would be affected in the same way by the proposals under consideration, but in any other case shall treat them as separate classes of Shares.
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10.3 |
The rights conferred upon the holders of the Shares of any class issued with preferred or other rights shall not, unless otherwise expressly provided by the terms of issue of the Shares of that class, be deemed to be varied by the creation or issue of further Shares ranking pari passu therewith or Shares issued with preferred or other rights.
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11
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Commission on Sale of Shares
|
12
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Non Recognition of Trusts
|
13
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Lien on Shares
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13.1 |
The Company shall have a first and paramount lien on all Shares (whether fully
paid-up
or not) registered in the name of a Member (whether solely or jointly with others) for all debts, liabilities or engagements to or with the Company (whether presently payable or not) by such Member or his estate, either alone or jointly with any other person, whether a Member or not, but the Directors may at any time declare any Share to be wholly or in part exempt from the provisions of this Article. The registration of a transfer of any such Share shall operate as a waiver of the Company’s lien thereon. The Company’s lien on a Share shall also extend to any amount payable in respect of that Share.
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13.2 |
The Company may sell, in such manner as the Directors think fit, any Shares on which the Company has a lien, if a sum in respect of which the lien exists is presently payable, and is not paid within fourteen
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Filed:
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Auth Code: J29695536021
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clear days after notice has been received or deemed to have been received by the holder of the Shares, or to the person entitled to it in consequence of the death or bankruptcy of the holder, demanding payment and stating that if the notice is not complied with the Shares may be sold. |
13.3 |
To give effect to any such sale the Directors may authorise any person to execute an instrument of transfer of the Shares sold to, or in accordance with the directions of, the purchaser. The purchaser or his nominee shall be registered as the holder of the Shares comprised in any such transfer, and he shall not be bound to see to the application of the purchase money, nor shall his title to the Shares be affected by any irregularity or invalidity in the sale or the exercise of the Company’s power of sale under the Articles.
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13.4 |
The net proceeds of such sale after payment of costs, shall be applied in payment of such part of the amount in respect of which the lien exists as is presently payable and any balance shall (subject to a like lien for sums not presently payable as existed upon the Shares before the sale) be paid to the person entitled to the Shares at the date of the sale.
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14
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Call on Shares
|
14.1 |
Subject to the terms of the allotment and issue of any Shares, the Directors may make calls upon the Members in respect of any monies unpaid on their Shares (whether in respect of par value or premium), and each Member shall (subject to receiving at least fourteen clear days’ notice specifying the time or times of payment) pay to the Company at the time or times so specified the
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amount called on the Shares. A call may be revoked or postponed, in whole or in part, as the Directors may determine. A call may be required to be paid by instalments. A person upon whom a call is made shall remain liable for calls made upon him notwithstanding the subsequent transfer of the Shares in respect of which the call was made. |
14.2 |
A call shall be deemed to have been made at the time when the resolution of the Directors authorising such call was passed.
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14.3 |
The joint holders of a Share shall be jointly and severally liable to pay all calls in respect thereof.
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14.4 |
If a call remains unpaid after it has become due and payable, the person from whom it is due shall pay interest on the amount unpaid from the day it became due and payable until it is paid at such rate as the Directors may determine (and in addition all expenses that have been incurred by the Company by reason of such
non-payment),
but the Directors may waive payment of the interest or expenses wholly or in part.
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14.5 |
An amount payable in respect of a Share on issue or allotment or at any fixed date, whether on account of the par value of the Share or premium or otherwise, shall be deemed to be a call and if it is not paid all the provisions of the Articles shall apply as if that amount had become due and payable by virtue of a call.
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14.6 |
The Directors may issue Shares with different terms as to the amount and times of payment of calls, or the interest to be paid.
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14.7 |
The Directors may, if they think fit, receive an amount from any Member willing to advance all or any part of the monies uncalled and unpaid upon any Shares held by him, and may (until the amount would otherwise become payable) pay interest at such rate as may be agreed upon between the Directors and the Member paying such amount in advance.
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14.8 |
No such amount paid in advance of calls shall entitle the Member paying such amount to any portion of a Dividend or other distribution payable in respect of any period prior to the date upon which such amount would, but for such payment, become payable.
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15
|
Forfeiture of Shares
|
15.1 |
If a call or instalment of a call remains unpaid after it has become due and payable the Directors may give to the person from whom it is due not less than fourteen clear days’ notice requiring payment of the amount unpaid together with any interest which may have accrued and any expenses incurred by the Company by reason of such
non-payment.
The notice shall specify where payment is to be made and shall state that if the notice is not complied with the Shares in respect of which the call was made will be liable to be forfeited.
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15.2 |
If the notice is not complied with, any Share in respect of which it was given may, before the payment required by the notice has been made, be forfeited by a resolution of the Directors. Such forfeiture shall include all Dividends, other distributions or other monies payable in respect of the forfeited Share and not paid before the forfeiture.
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15.3 |
A forfeited Share may be sold,
re-allotted
or otherwise disposed of on such terms and in such manner as the Directors think fit and at any time before a sale,
re-allotment
or disposition the forfeiture may be cancelled on such terms as the Directors think fit. Where for the purposes of its disposal a forfeited Share is to be transferred to any person the Directors may authorise some person to execute an instrument of transfer of the Share in favour of that person.
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15.4 |
A person any of whose Shares have been forfeited shall cease to be a Member in respect of them and shall surrender to the Company for cancellation the certificate for the Shares forfeited and shall remain liable to pay to the Company all monies which at the date of forfeiture were payable by him to the Company in respect of those Shares together with interest at such rate as the Directors may determine, but his liability shall cease if and when the Company shall have received payment in full of all monies due and payable by him in respect of those Shares.
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15.5 |
A certificate in writing under the hand of one Director or Officer that a Share has been forfeited on a specified date shall be conclusive evidence of the facts stated in it as against all persons claiming to be entitled to the Share. The certificate shall (subject to the execution of an instrument of transfer) constitute a good title to the Share and the person to whom the Share is sold or otherwise disposed of shall not be bound to see to the application of the purchase money, if any, nor shall his title to the Share be affected by any irregularity or invalidity in the proceedings in reference to the forfeiture, sale or disposal of the Share.
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15.6 |
The provisions of the Articles as to forfeiture shall apply in the case of non payment of any sum which, by the terms of issue of a Share, becomes payable at a fixed time, whether on account of the par value of the Share or by way of premium as if it had been payable by virtue of a call duly made and notified.
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16
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Transmission of Shares
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16.1 |
If a Member dies, the survivor or survivors (where he was a joint holder), or his legal personal representatives (where he was a sole holder), shall be the only persons recognised by the Company as having any title to his Shares. The estate of a deceased Member is not thereby released from any liability in respect of any Share, for which he was a joint or sole holder.
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16.2 |
Any person becoming entitled to a Share in consequence of the death or bankruptcy or liquidation or dissolution of a Member (or in any other way than by transfer) may, upon such evidence being produced as may be required by the Directors, elect, by a notice in writing sent by him to the Company, either to become the holder of such Share or to have some person nominated by him registered as the holder of such Share. If he elects to have another person registered as the holder of such Share he shall sign an instrument of transfer of that Share to that person. The Directors shall, in either case, have the same right to decline or suspend registration as they would have had in the case of a transfer of the Share by the relevant Member before his death or bankruptcy or liquidation or dissolution, as the case may be.
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16.3 |
A person becoming entitled to a Share by reason of the death or bankruptcy or liquidation or dissolution of a Member (or in any other case than by transfer) shall be entitled to the same Dividends, other distributions and other advantages to which he would be entitled if he were the holder of such Share. However, he shall not, before becoming a Member in respect of a Share, be entitled in respect of it to exercise any right conferred by membership in relation to general meetings of the Company and the Directors may at any time give notice requiring any such person to elect either to be registered himself or to have some person nominated by him be registered as the holder of the Share (but the Directors shall, in either case, have the same right to decline or suspend registration as they would have had in the case of a transfer of the Share by the relevant Member before his death or bankruptcy or liquidation or dissolution or any other case than by transfer, as the case may be). If the notice is not complied with within ninety days of being received or deemed to be received (as determined pursuant to the Articles), the Directors may thereafter withhold payment of all Dividends, other distributions, bonuses or other monies payable in respect of the Share until the requirements of the notice have been complied with.
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17
|
Class B Ordinary Share Conversion
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17.1 |
The rights attaching to the Class A Shares and Class B Shares shall rank
pari passu
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17.2 |
Class B Shares shall automatically convert into Class A Shares on a
one-for-one
Initial Conversion Ratio
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17.3 |
Notwithstanding the Initial Conversion Ratio, in the case that additional Class A Shares or any other Equity-linked Securities are issued, or deemed issued, by the Company in excess of the amounts offered in the IPO and related to the closing of a Business Combination, all Class B Shares in issue shall automatically convert into Class A Shares at the time of the closing of a Business Combination at a ratio for which the Class B Shares shall convert into Class A Shares will be adjusted (unless the holders of a majority of the Class B Shares in issue agree to waive such anti-dilution adjustment with respect to any such issuance or deemed issuance) so that the number of Class A Shares issuable upon conversion of all Class B Shares will equal, on an as-converted basis, in the aggregate, 20 per cent of the sum of all Class A Shares and Class B Shares in issue upon completion of the IPO plus all Class A Shares and Equity-linked Securities issued or deemed issued in connection with a Business Combination, excluding
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Auth Code: J29695536021
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any forward purchase securities and Class A Shares or Equity-linked Securities issued, or to be issued, to any seller in a Business Combination and any private placement Shares issued to the Sponsor, a Director, an Officer or their Affiliates, including upon conversion of working capital loans made to the Company. |
17.4 |
Notwithstanding anything to the contrary contained herein, the foregoing adjustment to the Initial Conversion Ratio may be waived as to any particular issuance or deemed issuance of additional Class A Shares or Equity-linked Securities by the written consent or agreement of holders of a majority of the Class B Shares then in issue consenting or agreeing separately as a separate class in the manner provided in the Variation of Rights of Shares Article hereof.
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17.5 |
The foregoing conversion ratio shall also be adjusted to account for any subdivision (by share split, subdivision, exchange, capitalisation, rights issue, reclassification, recapitalisation or otherwise) or combination (by reverse share split, share consolidation, exchange, reclassification, recapitalisation or otherwise) or similar reclassification or recapitalisation of the Class A Shares in issue into a greater or lesser number of shares occurring after the original filing of the Articles without a proportionate and corresponding subdivision, combination or similar reclassification or recapitalisation of the Class B Shares in issue.
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17.6 |
Each Class B Share shall convert into its pro rata number of Class A Shares pursuant to this Article. The pro rata share for each holder of Class B Shares will be determined as follows: each Class B Share shall convert into such number of Class A Shares as is equal to the product of 1 multiplied by a fraction, the numerator of which shall be the total number of Class A Shares into which all of the Class B Shares in issue shall be converted pursuant to this Article and the denominator of which shall be the total number of Class B Shares in issue at the time of conversion.
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17.7 |
References in this Article to “
converted
conversion
exchange
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17.8 |
Notwithstanding anything to the contrary in this Article, in no event may any Class B Share convert into Class A Shares at a ratio that is less than
one-for-one.
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18
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Amendments of Memorandum and Articles of Association and Alteration of Capital
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18.1 |
The Company may by Ordinary Resolution:
|
(a) |
increase its share capital by such sum as the Ordinary Resolution shall prescribe and with such rights, priorities and privileges annexed thereto, as the Company in general meeting may determine;
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(b) |
consolidate and divide all or any of its share capital into Shares of larger amount than its existing Shares;
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(c) |
convert all or any of its
paid-up
Shares into stock, and reconvert that stock into
paid-up
Shares of any denomination;
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(d) |
by subdivision of its existing Shares or any of them divide the whole or any part of its share capital into Shares of smaller amount than is fixed by the Memorandum or into Shares without par value; and
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(e) |
cancel any Shares that at the date of the passing of the Ordinary Resolution have not been taken or agreed to be taken by any person and diminish the amount of its share capital by the amount of the Shares so cancelled.
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18.2 |
All new Shares created in accordance with the provisions of the preceding Article shall be subject to the same provisions of the Articles with reference to the payment of calls, liens, transfer, transmission, forfeiture and otherwise as the Shares in the original share capital.
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18.3 |
Subject to the provisions of the Statute, the provisions of the Articles as regards the matters to be dealt with by Ordinary Resolution, Article 29.4, Article 47.1 and Article 47.2, the Company may by Special Resolution:
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(a) |
change its name;
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(b) |
alter or add to the Articles;
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(c) |
alter or add to the Memorandum with respect to any objects, powers or other matters specified therein; and
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(d) |
reduce its share capital or any capital redemption reserve fund.
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19
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Offices and Places of Business
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20
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General Meetings
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20.1 |
All general meetings other than annual general meetings shall be called extraordinary general meetings.
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20.2 |
The Company may, but shall not (unless required by the Statute) be obliged to, in each year hold a general meeting as its annual general meeting, and shall specify the meeting as such in the notices calling it. Any annual general meeting shall be held at such time and place as the Directors shall appoint. At these meetings the report of the Directors (if any) shall be presented.
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20.3 |
The Directors, the chief executive officer or the chairman of the board of Directors may call general meetings, and, for the avoidance of doubt, Members shall not have the ability to call general meetings.
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20.4 |
Members seeking to bring business before the annual general meeting or to nominate candidates for appointment as Directors at the annual general meeting must deliver notice to the principal executive offices of the Company not less than 120 calendar days before the date of the Company’s proxy statement released to Members in connection with the previous year’s annual general meeting or, if the Company did not hold an annual general meeting the previous year, or if the date of the current year’s annual general meeting has been changed by more than 30 days from the date of the previous year’s annual general meeting, then the deadline shall be set by the board of Directors with such deadline being a reasonable time before the Company begins to print and send its related proxy materials.
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21
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Notice of General Meetings
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21.1 |
At least five clear days’ notice shall be given of any general meeting. Every notice shall specify the place, the day and the hour of the meeting and the general nature of the business to be conducted at the general meeting and shall be given in the manner hereinafter mentioned or in such other manner if any as may be prescribed by the Company, provided that a general meeting of the Company shall, whether or not the notice specified in this Article has been given and whether or not the provisions of the Articles regarding general meetings have been complied with, be deemed to have been duly convened if it is so agreed:
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(a) |
in the case of an annual general meeting, by all of the Members entitled to attend and vote thereat; and
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(b) |
in the case of an extraordinary general meeting, by a majority in number of the Members having a right to attend and vote at the meeting, together holding not less than ninety-five per cent in par value of the Shares giving that right.
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21.2 |
The accidental omission to give notice of a general meeting to, or the non receipt of notice of a general meeting by, any person entitled to receive such notice shall not invalidate the proceedings of that general meeting.
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22
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Proceedings at General Meetings
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22.1 |
No business shall be transacted at any general meeting unless a quorum is present. The holders of a majority of the Shares being individuals present in person or by proxy or if a corporation or other
non-natural
person by its duly authorised representative or proxy shall be a quorum.
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22.2 |
A person may participate at a general meeting by conference telephone or other communications equipment by means of which all the persons participating in the meeting can communicate with each other. Participation by a person in a general meeting in this manner is treated as presence in person at that meeting.
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22.3 |
A resolution (including a Special Resolution) in writing (in one or more counterparts) signed by or on behalf of all of the Members for the time being entitled to receive notice of and to attend and vote at general meetings (or, being corporations or other
non-natural
persons, signed by their duly authorised representatives) shall be as valid and effective as if the resolution had been passed at a general meeting of the Company duly convened and held.
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22.4 |
If a quorum is not present within half an hour from the time appointed for the meeting to commence, the meeting shall stand adjourned to the same day in the next week at the same time and/or place or to such other day, time and/or place as the Directors may determine, and if at the adjourned meeting a quorum is not present within half an hour from the time appointed for the meeting to commence, the Members present shall be a quorum.
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22.5 |
The Directors may, at any time prior to the time appointed for the meeting to commence, appoint any person to act as chairman of a general meeting of the Company or, if the Directors do not make any such appointment, the chairman, if any, of the board of Directors shall preside as chairman at such general meeting. If there is no such chairman, or if he shall not be present within fifteen minutes after the time appointed for the meeting to commence, or is unwilling to act, the Directors present shall elect one of their number to be chairman of the meeting.
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22.6 |
If no Director is willing to act as chairman or if no Director is present within fifteen minutes after the time appointed for the meeting to commence, the Members present shall choose one of their number to be chairman of the meeting.
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22.7 |
The chairman may, with the consent of a meeting at which a quorum is present (and shall if so directed by the meeting) adjourn the meeting from time to time and from place to place, but no business shall be transacted at any adjourned meeting other than the business left unfinished at the meeting from which the adjournment took place.
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22.8 |
When a general meeting is adjourned for thirty days or more, notice of the adjourned meeting shall be given as in the case of an original meeting. Otherwise it shall not be necessary to give any such notice of an adjourned meeting.
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22.9 |
If, prior to a Business Combination, a notice is issued in respect of a general meeting and the Directors, in their absolute discretion, consider that it is impractical or undesirable for any reason to hold that general meeting at the place, the day and the hour specified in the notice calling such general meeting, the Directors may postpone the general meeting to another place, day and/or hour provided that notice of the place, the day and the hour of the rearranged general meeting is promptly given to all Members. No business shall be transacted at any postponed meeting other than the business specified in the notice of the original meeting.
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22.10 |
When a general meeting is postponed for thirty days or more, notice of the postponed meeting shall be given as in the case of an original meeting. Otherwise it shall not be necessary to give any such notice of a postponed meeting. All proxy forms submitted for the original general meeting shall remain valid for the postponed meeting. The Directors may postpone a general meeting which has already been postponed.
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22.11 |
A resolution put to the vote of the meeting shall be decided on a poll.
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22.12 |
A poll shall be taken as the chairman directs, and the result of the poll shall be deemed to be the resolution of the general meeting at which the poll was demanded.
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22.13 |
A poll demanded on the election of a chairman or on a question of adjournment shall be taken forthwith. A poll demanded on any other question shall be taken at such date, time and place as the chairman of the general meeting directs, and any business other than that upon which a poll has been demanded or is contingent thereon may proceed pending the taking of the poll.
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22.14 |
In the case of an equality of votes the chairman shall be entitled to a second or casting vote.
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23
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Votes of Members
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23.1 |
Subject to any rights or restrictions attached to any Shares, including as set out at Article 29.4, Article 47.1 and Article 47.2, every Member present in any such manner shall have one vote for every Share of which he is the holder.
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23.2 |
In the case of joint holders the vote of the senior holder who tenders a vote, whether in person or by proxy (or, in the case of a corporation or other
non-natural
person, by its duly authorised representative or proxy), shall be accepted to the exclusion of the votes of the other joint holders, and seniority shall be determined by the order in which the names of the holders stand in the Register of Members.
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23.3 |
A Member of unsound mind, or in respect of whom an order has been made by any court, having jurisdiction in lunacy, may vote by his committee, receiver, curator bonis, or other person on such Member’s behalf appointed by that court, and any such committee, receiver, curator bonis or other person may vote by proxy.
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23.4 |
No person shall be entitled to vote at any general meeting unless he is registered as a Member on the record date for such meeting nor unless all calls or other monies then payable by him in respect of Shares have been paid.
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23.5 |
No objection shall be raised as to the qualification of any voter except at the general meeting or adjourned general meeting at which the vote objected to is given or tendered and every vote not disallowed at the meeting shall be valid. Any objection made in due time in accordance with this Article shall be referred to the chairman whose decision shall be final and conclusive.
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23.6 |
Votes may be cast either personally or by proxy (or in the case of a corporation or other
non-natural
person by its duly authorised representative or proxy). A Member may appoint more than one proxy or the same proxy under one or more instruments to attend and vote at a meeting. Where a Member appoints more than one proxy the instrument of proxy shall specify the number of Shares in respect of which each proxy is entitled to exercise the related votes.
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23.7 |
A Member holding more than one Share need not cast the votes in respect of his Shares in the same way on any resolution and therefore may vote a Share or some or all such Shares either for or against a resolution and/or abstain from voting a Share or some or all of the Shares and, subject to the terms of the instrument appointing him, a proxy appointed under one or more instruments may vote a Share or some or all of the Shares in respect of which he is appointed either for or against a resolution and/or abstain from voting a Share or some or all of the Shares in respect of which he is appointed.
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24
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Proxies
|
24.1 |
The instrument appointing a proxy shall be in writing and shall be executed under the hand of the appointor or of his attorney duly authorised in writing, or, if the appointor is a corporation or other non natural person, under the hand of its duly authorised representative. A proxy need not be a Member.
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24.2 |
The Directors may, in the notice convening any meeting or adjourned meeting, or in an instrument of proxy sent out by the Company, specify the manner by which the instrument appointing a proxy shall be deposited and the place and the time (being not later than the time appointed for the commencement of the meeting or adjourned meeting to which the proxy relates) at which the instrument appointing a proxy shall be deposited. In the absence of any such direction from the Directors in the notice convening any meeting or adjourned meeting or in an instrument of proxy sent out by the Company, the instrument appointing a proxy shall be deposited physically at the Registered Office not less than 48 hours before the time appointed for the meeting or adjourned meeting to commence at which the person named in the instrument proposes to vote.
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24.3 |
The chairman may in any event at his discretion declare that an instrument of proxy shall be deemed to have been duly deposited. An instrument of proxy that is not deposited in the manner permitted, or which has not been declared to have been duly deposited by the chairman, shall be invalid.
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24.4 |
The instrument appointing a proxy may be in any usual or common form (or such other form as the Directors may approve) and may be expressed to be for a particular meeting or any adjournment thereof
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or generally until revoked. An instrument appointing a proxy shall be deemed to include the power to demand or join or concur in demanding a poll. |
24.5 |
Votes given in accordance with the terms of an instrument of proxy shall be valid notwithstanding the previous death or insanity of the principal or revocation of the proxy or of the authority under which the proxy was executed, or the transfer of the Share in respect of which the proxy is given unless notice in writing of such death, insanity, revocation or transfer was received by the Company at the Registered Office before the commencement of the general meeting, or adjourned meeting at which it is sought to use the proxy.
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25
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Corporate Members
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25.1 |
Any corporation or other
non-natural
person which is a Member may in accordance with its constitutional documents, or in the absence of such provision by resolution of its directors or other governing body, authorise such person as it thinks fit to act as its representative at any meeting of the Company or of any class of Members, and the person so authorised shall be entitled to exercise the same powers on behalf of the corporation which he represents as the corporation could exercise if it were an individual Member.
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25.2 |
If a Clearing House (or its nominee(s)), being a corporation, is a Member, it may authorise such persons as it sees fit to act as its representative at any meeting of the Company or at any meeting of any class of Members provided that the authorisation shall specify the number and class of Shares in respect of which each such representative is so authorised. Each person so authorised under the provisions of this Article shall be deemed to have been duly authorised without further evidence of the facts and be entitled to exercise the same rights and powers on behalf of the Clearing House (or its nominee(s)) as if such person was the registered holder of such Shares held by the Clearing House (or its nominee(s)).
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26
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Shares that May Not be Voted
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27
|
Directors
|
27.1 |
There shall be a board of Directors consisting of not less than one person provided however that the Company may by Ordinary Resolution increase or reduce the limits in the number of Directors.
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27.2 |
The Directors shall be divided into three classes: Class I, Class II and Class III. The number of Directors in each class shall be as nearly equal as possible. Upon the adoption of the Articles, the existing Directors shall by resolution classify themselves as Class I, Class II or Class III Directors. The Class I Directors shall stand elected for a term expiring at the Company’s first annual general meeting, the Class II Directors shall stand elected for a term expiring at the Company’s second annual general meeting and the Class III Directors shall stand elected for a term expiring at the Company’s third annual general meeting. Commencing at the Company’s first annual general meeting, and at each annual general meeting thereafter, Directors elected to succeed those Directors whose terms expire shall be elected for a term of office to expire at the third succeeding annual general meeting after their election. Except as the Statute or other Applicable Law may otherwise require, in the interim between annual general meetings or
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extraordinary general meetings called for the election of Directors and/or the removal of one or more Directors and the filling of any vacancy in that connection, additional Directors and any vacancies in the board of Directors, including unfilled vacancies resulting from the removal of Directors for cause, may be filled by the vote of a majority of the remaining Directors then in office, although less than a quorum (as defined in the Articles), or by the sole remaining Director. All Directors shall hold office until the expiration of their respective terms of office and until their successors shall have been elected and qualified. A Director elected to fill a vacancy resulting from the death, resignation or removal of a Director shall serve for the remainder of the full term of the Director whose death, resignation or removal shall have created such vacancy and until his successor shall have been elected and qualified. |
28
|
Powers of Directors
|
28.1 |
Subject to the provisions of the Statute, the Memorandum and the Articles and to any directions given by Special Resolution, the business of the Company shall be managed by the Directors who may exercise all the powers of the Company. No alteration of the Memorandum or Articles and no such direction shall invalidate any prior act of the Directors which would have been valid if that alteration had not been made or that direction had not been given. A duly convened meeting of Directors at which a quorum is present may exercise all powers exercisable by the Directors.
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28.2 |
All cheques, promissory notes, drafts, bills of exchange and other negotiable or transferable instruments and all receipts for monies paid to the Company shall be signed, drawn, accepted, endorsed or otherwise executed as the case may be in such manner as the Directors shall determine by resolution.
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28.3 |
The Directors on behalf of the Company may pay a gratuity or pension or allowance on retirement to any Director who has held any other salaried office or place of profit with the Company or to his widow or dependants and may make contributions to any fund and pay premiums for the purchase or provision of any such gratuity, pension or allowance.
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28.4 |
The Directors may exercise all the powers of the Company to borrow money and to mortgage or charge its undertaking, property and assets (present and future) and uncalled capital or any part thereof and to issue debentures, debenture stock, mortgages, bonds and other such securities whether outright or as security for any debt, liability or obligation of the Company or of any third party.
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29
|
Appointment and Removal of Directors
|
29.1 |
Prior to the closing of a Business Combination, the Company may by Ordinary Resolution of the holders of the Class B Shares appoint any person to be a Director or may by Ordinary Resolution of the holders of the Class B Shares remove any Director. For the avoidance of doubt, prior to the closing of a Business Combination, holders of Class A Shares shall have no right to vote on the appointment or removal of any Director.
|
29.2 |
The Directors may appoint any person to be a Director, either to fill a vacancy or as an additional Director provided that the appointment does not cause the number of Directors to exceed any number fixed by or in accordance with the Articles as the maximum number of Directors.
|
29.3 |
After the closing of a Business Combination, the Company may by Ordinary Resolution appoint any person to be a Director or may by Ordinary Resolution remove any Director.
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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29.4 |
Prior to the closing a Business Combination, Article 29.1 may only be amended by a Special Resolution which shall include the affirmative vote of a simple majority of the Class B Shares
|
30
|
Vacation of Office of Director
|
(a) |
the Director gives notice in writing to the Company that he resigns the office of Director; or
|
(b) |
the Director absents himself (for the avoidance of doubt, without being represented by proxy) from three consecutive meetings of the board of Directors without special leave of absence from the Directors, and the Directors pass a resolution that he has by reason of such absence vacated office; or
|
(c) |
the Director dies, becomes bankrupt or makes any arrangement or composition with his creditors generally; or
|
(d) |
the Director is found to be or becomes of unsound mind; or
|
(e) |
all of the other Directors (being not less than two in number) determine that he should be removed as a Director, either by a resolution passed by all of the other Directors at a meeting of the Directors duly convened and held in accordance with the Articles or by a resolution in writing signed by all of the other Directors.
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31
|
Proceedings of Directors
|
31.1 |
The quorum for the transaction of the business of the Directors may be fixed by the Directors, and unless so fixed shall be a majority of the Directors then in office.
|
31.2 |
Subject to the provisions of the Articles, the Directors may regulate their proceedings as they think fit. Questions arising at any meeting shall be decided by a majority of votes. In the case of an equality of votes, the chairman shall have a second or casting vote.
|
31.3 |
A person may participate in a meeting of the Directors or any committee of Directors by conference telephone or other communications equipment by means of which all the persons participating in the meeting can communicate with each other at the same time. Participation by a person in a meeting in this manner is treated as presence in person at that meeting. Unless otherwise determined by the Directors, the meeting shall be deemed to be held at the place where the chairman is located at the start of the meeting.
|
31.4 |
A resolution in writing (in one or more counterparts) signed by all the Directors or all the members of a committee of the Directors or, in the case of a resolution in writing relating to the removal of any Director or the vacation of office by any Director, all of the Directors other than the Director who is the subject of such resolution shall be as valid and effectual as if it had been passed at a meeting of the Directors, or committee of Directors as the case may be, duly convened and held.
|
31.5 |
A Director may, or other Officer on the direction of a Director shall, call a meeting of the Directors by at least two days’ notice in writing to every Director which notice shall set forth the general nature of the business to be considered unless notice is waived by all the Directors either at, before or after the meeting is held. To any such notice of a meeting of the Directors all the provisions of the Articles relating to the giving of notices by the Company to the Members shall apply
mutatis mutandis.
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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31.6 |
The continuing Directors (or a sole continuing Director, as the case may be) may act notwithstanding any vacancy in their body, but if and so long as their number is reduced below the number fixed by or pursuant to the Articles as the necessary quorum of Directors the continuing Directors or Director may act for the purpose of increasing the number of Directors to be equal to such fixed number, or of summoning a general meeting of the Company, but for no other purpose.
|
31.7 |
The Directors may elect a chairman of their board and determine the period for which he is to hold office; but if no such chairman is elected, or if at any meeting the chairman is not present within five minutes after the time appointed for the meeting to commence, the Directors present may choose one of their number to be chairman of the meeting.
|
31.8 |
All acts done by any meeting of the Directors or of a committee of the Directors shall, notwithstanding that it is afterwards discovered that there was some defect in the appointment of any Director, and/or that they or any of them were disqualified, and/or had vacated their office and/or were not entitled to vote, be as valid as if every such person had been duly appointed and/or not disqualified to be a Director and/or had not vacated their office and/or had been entitled to vote, as the case may be.
|
31.9 |
A Director may be represented at any meetings of the board of Directors by a proxy appointed in writing by him. The proxy shall count towards the quorum and the vote of the proxy shall for all purposes be deemed to be that of the appointing Director.
|
32
|
Presumption of Assent
|
33
|
Directors’ Interests
|
33.1 |
A Director may hold any other office or place of profit under the Company (other than the office of Auditor) in conjunction with his office of Director for such period and on such terms as to remuneration and otherwise as the Directors may determine.
|
33.2 |
A Director may act by himself or by, through or on behalf of his firm in a professional capacity for the Company and he or his firm shall be entitled to remuneration for professional services as if he were not a Director.
|
33.3 |
A Director may be or become a director or other officer of or otherwise interested in any company promoted by the Company or in which the Company may be interested as a shareholder, a contracting party or otherwise, and no such Director shall be accountable to the Company for any remuneration or other benefits received by him as a director or officer of, or from his interest in, such other company.
|
33.4 |
No person shall be disqualified from the office of Director or prevented by such office from contracting with the Company, either as vendor, purchaser or otherwise, nor shall any such contract or any contract or transaction entered into by or on behalf of the Company in which any Director shall be in any way
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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interested be or be liable to be avoided, nor shall any Director so contracting or being so interested be liable to account to the Company for any profit realised by or arising in connection with any such contract or transaction by reason of such Director holding office or of the fiduciary relationship thereby established. A Director shall be at liberty to vote in respect of any contract or transaction in which he is interested provided that the nature of the interest of any Director in any such contract or transaction shall be disclosed by him at or prior to its consideration and any vote thereon. |
33.5 |
A general notice that a Director is a shareholder, director, officer or employee of any specified firm or company and is to be regarded as interested in any transaction with such firm or company shall be sufficient disclosure for the purposes of voting on a resolution in respect of a contract or transaction in which he has an interest, and after such general notice it shall not be necessary to give special notice relating to any particular transaction.
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34
|
Minutes
|
35
|
Delegation of Directors’ Powers
|
35.1 |
The Directors may delegate any of their powers, authorities and discretions, including the power to
sub-delegate,
to any committee consisting of one or more Directors (including, without limitation, the Audit Committee, the Compensation Committee and the Nominating Committee). Any such delegation may be made subject to any conditions the Directors may impose and either collaterally with or to the exclusion of their own powers and any such delegation may be revoked or altered by the Directors. Subject to any such conditions, the proceedings of a committee of Directors shall be governed by the Articles regulating the proceedings of Directors, so far as they are capable of applying.
|
35.2 |
The Directors may establish any committees, local boards or agencies or appoint any person to be a manager or agent for managing the affairs of the Company and may appoint any person to be a member of such committees, local boards or agencies. Any such appointment may be made subject to any conditions the Directors may impose, and either collaterally with or to the exclusion of their own powers and any such appointment may be revoked or altered by the Directors. Subject to any such conditions, the proceedings of any such committee, local board or agency shall be governed by the Articles regulating the proceedings of Directors, so far as they are capable of applying.
|
35.3 |
The Directors may adopt formal written charters for committees and, if so adopted, shall review and assess the adequacy of such formal written charters on an annual basis. Each of these committees shall be empowered to do all things necessary to exercise the rights of such committee set forth in the Articles and shall have such powers as the Directors may delegate pursuant to the Articles and as required by the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law. Each of the Audit Committee, the Compensation Committee and the Nominating Committee, if established, shall consist of such number of Directors as the Directors shall from time to time determine (or such minimum number as may
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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be required from time to time by the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law). For so long as any class of Shares is listed on the Designated Stock Exchange, the Audit Committee, the Compensation Committee and the Nominating Committee shall be made up of such number of Independent Directors as is required from time to time by the rules and regulations of the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law. |
35.4 |
The Directors may by power of attorney or otherwise appoint any person to be the agent of the Company on such conditions as the Directors may determine, provided that the delegation is not to the exclusion of their own powers and may be revoked by the Directors at any time.
|
35.5 |
The Directors may by power of attorney or otherwise appoint any company, firm, person or body of persons, whether nominated directly or indirectly by the Directors, to be the attorney or authorised signatory of the Company for such purpose and with such powers, authorities and discretions (not exceeding those vested in or exercisable by the Directors under the Articles) and for such period and subject to such conditions as they may think fit, and any such powers of attorney or other appointment may contain such provisions for the protection and convenience of persons dealing with any such attorneys or authorised signatories as the Directors may think fit and may also authorise any such attorney or authorised signatory to delegate all or any of the powers, authorities and discretions vested in him.
|
35.6 |
The Directors may appoint such Officers as they consider necessary on such terms, at such remuneration and to perform such duties, and subject to such provisions as to disqualification and removal as the Directors may think fit. Unless otherwise specified in the terms of his appointment an Officer may be removed by resolution of the Directors or Members. An Officer may vacate his office at any time if he gives notice in writing to the Company that he resigns his office.
|
36
|
No Minimum Shareholding
|
37
|
Remuneration of Directors
|
37.1 |
The remuneration to be paid to the Directors, if any, shall be such remuneration as the Directors shall determine, provided that no cash remuneration shall be paid to any Director by the Company prior to the consummation of a Business Combination. The Directors shall also, whether prior to or after the consummation of a Business Combination, be entitled to be paid all travelling, hotel and other expenses properly incurred by them in connection with their attendance at meetings of Directors or committees of Directors, or general meetings of the Company, or separate meetings of the holders of any class of Shares or debentures of the Company, or otherwise in connection with the business of the Company or the discharge of their duties as a Director, or to receive a fixed allowance in respect thereof as may be determined by the Directors, or a combination partly of one such method and partly the other.
|
37.2 |
The Directors may by resolution approve additional remuneration to any Director for any services which in the opinion of the Directors go beyond his ordinary routine work as a Director. Any fees paid to a Director who is also counsel, attorney or solicitor to the Company, or otherwise serves it in a professional capacity shall be in addition to his remuneration as a Director.
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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38
|
Seal
|
38.1 |
The Company may, if the Directors so determine, have a Seal. The Seal shall only be used by the authority of the Directors or of a committee of the Directors authorised by the Directors. Every instrument to which the Seal has been affixed shall be signed by at least one person who shall be either a Director or some Officer or other person appointed by the Directors for the purpose.
|
38.2 |
The Company may have for use in any place or places outside the Cayman Islands a duplicate Seal or Seals each of which shall be a facsimile of the common Seal of the Company and, if the Directors so determine, with the addition on its face of the name of every place where it is to be used.
|
38.3 |
A Director or Officer, representative or attorney of the Company may without further authority of the Directors affix the Seal over his signature alone to any document of the Company required to be authenticated by him under seal or to be filed with the Registrar of Companies in the Cayman Islands or elsewhere wheresoever.
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39
|
Dividends, Distributions and Reserve
|
39.1 |
Subject to the Statute and this Article and except as otherwise provided by the rights attached to any Shares, the Directors may resolve to pay Dividends and other distributions on Shares in issue and authorise payment of the Dividends or other distributions out of the funds of the Company lawfully available therefor. A Dividend shall be deemed to be an interim Dividend unless the terms of the resolution pursuant to which the Directors resolve to pay such Dividend specifically state that such Dividend shall be a final Dividend. No Dividend or other distribution shall be paid except out of the realised or unrealised profits of the Company, out of the share premium account or as otherwise permitted by law.
|
39.2 |
Except as otherwise provided by the rights attached to any Shares, all Dividends and other distributions shall be paid according to the par value of the Shares that a Member holds. If any Share is issued on terms providing that it shall rank for Dividend as from a particular date, that Share shall rank for Dividend accordingly.
|
39.3 |
The Directors may deduct from any Dividend or other distribution payable to any Member all sums of money (if any) then payable by him to the Company on account of calls or otherwise.
|
39.4 |
The Directors may resolve that any Dividend or other distribution be paid wholly or partly by the distribution of specific assets and in particular (but without limitation) by the distribution of shares, debentures, or securities of any other company or in any one or more of such ways and where any difficulty arises in regard to such distribution, the Directors may settle the same as they think expedient and in particular may issue fractional Shares and may fix the value for distribution of such specific assets or any part thereof and may determine that cash payments shall be made to any Members upon the basis of the value so fixed in order to adjust the rights of all Members and may vest any such specific assets in trustees in such manner as may seem expedient to the Directors.
|
39.5 |
Except as otherwise provided by the rights attached to any Shares, Dividends and other distributions may be paid in any currency. The Directors may determine the basis of conversion for any currency conversions that may be required and how any costs involved are to be met.
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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39.6 |
The Directors may, before resolving to pay any Dividend or other distribution, set aside such sums as they think proper as a reserve or reserves which shall, at the discretion of the Directors, be applicable for any purpose of the Company and pending such application may, at the discretion of the Directors, be employed in the business of the Company.
|
39.7 |
Any Dividend, other distribution, interest or other monies payable in cash in respect of Shares may be paid by wire transfer to the holder or by cheque or warrant sent through the post directed to the registered address of the holder or, in the case of joint holders, to the registered address of the holder who is first named on the Register of Members or to such person and to such address as such holder or joint holders may in writing direct. Every such cheque or warrant shall be made payable to the order of the person to whom it is sent. Any one of two or more joint holders may give effectual receipts for any Dividends, other distributions, bonuses, or other monies payable in respect of the Share held by them as joint holders.
|
39.8 |
No Dividend or other distribution shall bear interest against the Company.
|
39.9 |
Any Dividend or other distribution which cannot be paid to a Member and/or which remains unclaimed after six months from the date on which such Dividend or other distribution becomes payable may, in the discretion of the Directors, be paid into a separate account in the Company’s name, provided that the Company shall not be constituted as a trustee in respect of that account and the Dividend or other distribution shall remain as a debt due to the Member. Any Dividend or other distribution which remains unclaimed after a period of six years from the date on which such Dividend or other distribution becomes payable shall be forfeited and shall revert to the Company.
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40
|
Capitalisation
|
41
|
Books of Account
|
41.1 |
The Directors shall cause proper books of account (including, where applicable, material underlying documentation including contracts and invoices) to be kept with respect to all sums of money received and expended by the Company and the matters in respect of which the receipt or expenditure takes place, all sales and purchases of goods by the Company and the assets and liabilities of the Company. Such
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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books of account must be retained for a minimum period of five years from the date on which they are prepared. Proper books shall not be deemed to be kept if there are not kept such books of account as are necessary to give a true and fair view of the state of the Company’s affairs and to explain its transactions. |
41.2 |
The Directors shall determine whether and to what extent and at what times and places and under what conditions or regulations the accounts and books of the Company or any of them shall be open to the inspection of Members not being Directors and no Member (not being a Director) shall have any right of inspecting any account or book or document of the Company except as conferred by Statute or authorised by the Directors or by the Company in general meeting.
|
41.3 |
The Directors may cause to be prepared and to be laid before the Company in general meeting profit and loss accounts, balance sheets, group accounts (if any) and such other reports and accounts as may be required by law.
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42
|
Audit
|
42.1 |
The Directors may appoint an Auditor of the Company who shall hold office on such terms as the Directors determine.
|
42.2 |
Without prejudice to the freedom of the Directors to establish any other committee, if the Shares (or depositary receipts therefor) are listed or quoted on the Designated Stock Exchange, and if required by the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law, the Directors shall establish and maintain an Audit Committee as a committee of the Directors and shall adopt a formal written Audit Committee charter and review and assess the adequacy of the formal written charter on an annual basis. The composition and responsibilities of the Audit Committee shall comply with the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or otherwise under Applicable Law.
|
42.3 |
If the Shares (or depositary receipts therefor) are listed or quoted on the Designated Stock Exchange, the Company shall conduct an appropriate review of all related party transactions on an ongoing basis and shall utilise the Audit Committee for the review and approval of potential conflicts of interest.
|
42.4 |
The remuneration of the Auditor shall be fixed by the Audit Committee (if one exists).
|
42.5 |
If the office of Auditor becomes vacant by resignation or death of the Auditor, or by his becoming incapable of acting by reason of illness or other disability at a time when his services are required, the Directors shall fill the vacancy and determine the remuneration of such Auditor.
|
42.6 |
Every Auditor of the Company shall have a right of access at all times to the books and accounts and vouchers of the Company and shall be entitled to require from the Directors and Officers such information and explanation as may be necessary for the performance of the duties of the Auditor.
|
42.7 |
Auditors shall, if so required by the Directors, make a report on the accounts of the Company during their tenure of office at the next annual general meeting following their appointment in the case of a company which is registered with the Registrar of Companies as an ordinary company, and at the next extraordinary general meeting following their appointment in the case of a company which is registered with the Registrar of Companies as an exempted company, and at any other time during their term of office, upon request of the Directors or any general meeting of the Members.
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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43
|
Notices
|
43.1 |
Notices shall be in writing and may be given by the Company to any Member either personally or by sending it by courier, post, cable, telex, fax or
e-mail
to him or to his address as shown in the Register of Members (or where the notice is given by
e-mail
by sending it to the
e-mail
address provided by such Member). Notice may also be served by Electronic Communication in accordance with the rules and regulations of the Designated Stock Exchange, the Securities and Exchange Commission and/or any other competent regulatory authority or by placing it on the Company’s Website.
|
43.2 |
Where a notice is sent by:
|
(a) |
courier; service of the notice shall be deemed to be effected by delivery of the notice to a courier company, and shall be deemed to have been received on the third day (not including Saturdays or Sundays or public holidays) following the day on which the notice was delivered to the courier;
|
(b) |
post; service of the notice shall be deemed to be effected by properly addressing, pre paying and posting a letter containing the notice, and shall be deemed to have been received on the fifth day (not including Saturdays or Sundays or public holidays in the Cayman Islands) following the day on which the notice was posted;
|
(c) |
cable, telex or fax; service of the notice shall be deemed to be effected by properly addressing and sending such notice and shall be deemed to have been received on the same day that it was transmitted;
|
(d) |
e-mail
or other Electronic Communication; service of the notice shall be deemed to be effected by transmitting the
e-mail
to the
e-mail
address provided by the intended recipient and shall be deemed to have been received on the same day that it was sent, and it shall not be necessary for the receipt of the
e-mail
to be acknowledged by the recipient; and
|
(e) |
placing it on the Company’s Website; service of the notice shall be deemed to have been effected one hour after the notice or document was placed on the Company’s Website.
|
43.3 |
A notice may be given by the Company to the person or persons which the Company has been advised are entitled to a Share or Shares in consequence of the death or bankruptcy of a Member in the same manner as other notices which are required to be given under the Articles and shall be addressed to them by name, or by the title of representatives of the deceased, or trustee of the bankrupt, or by any like description at the address supplied for that purpose by the persons claiming to be so entitled, or at the option of the Company by giving the notice in any manner in which the same might have been given if the death or bankruptcy had not occurred.
|
43.4 |
Notice of every general meeting shall be given in any manner authorised by the Articles to every holder of Shares carrying an entitlement to receive such notice on the record date for such meeting except that in the case of joint holders the notice shall be sufficient if given to the joint holder first named in the Register of Members and every person upon whom the ownership of a Share devolves by reason of his being a legal personal representative or a trustee in bankruptcy of a Member where the Member but for his death or bankruptcy would be entitled to receive notice of the meeting, and no other person shall be entitled to receive notices of general meetings.
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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44
|
Winding Up
|
44.1 |
If the Company shall be wound up, the liquidator shall apply the assets of the Company in satisfaction of creditors’ claims in such manner and order as such liquidator thinks fit. Subject to the rights attaching to any Shares, in a winding up:
|
(a) |
if the assets available for distribution amongst the Members shall be insufficient to repay the whole of the Company’s issued share capital, such assets shall be distributed so that, as nearly as may be, the losses shall be borne by the Members in proportion to the par value of the Shares held by them; or
|
(b) |
if the assets available for distribution amongst the Members shall be more than sufficient to repay the whole of the Company’s issued share capital at the commencement of the winding up, the surplus shall be distributed amongst the Members in proportion to the par value of the Shares held by them at the commencement of the winding up subject to a deduction from those Shares in respect of which there are monies due, of all monies payable to the Company for unpaid calls or otherwise.
|
44.2 |
If the Company shall be wound up the liquidator may, subject to the rights attaching to any Shares and with the approval of a Special Resolution of the Company and any other approval required by the Statute, divide amongst the Members in kind the whole or any part of the assets of the Company (whether such assets shall consist of property of the same kind or not) and may for that purpose value any assets and determine how the division shall be carried out as between the Members or different classes of Members. The liquidator may, with the like approval, vest the whole or any part of such assets in trustees upon such trusts for the benefit of the Members as the liquidator, with the like approval, shall think fit, but so that no Member shall be compelled to accept any asset upon which there is a liability.
|
45
|
Indemnity and Insurance
|
45.1 |
Every Director and Officer (which for the avoidance of doubt, shall not include auditors of the Company), together with every former Director and former Officer (each an “
Indemnified Person
|
45.2 |
The Company shall advance to each Indemnified Person reasonable attorneys’ fees and other costs and expenses incurred in connection with the defence of any action, suit, proceeding or investigation involving such Indemnified Person for which indemnity will or could be sought. In connection with any advance of any expenses hereunder, the Indemnified Person shall execute an undertaking to repay the advanced amount to the Company if it shall be determined by final judgment or other final adjudication that such Indemnified Person was not entitled to indemnification pursuant to this Article. If it shall be
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Filed:
17-Nov-2020
Auth Code: J29695536021
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determined by a final judgment or other final adjudication that such Indemnified Person was not entitled to indemnification with respect to such judgment, costs or expenses, then such party shall not be indemnified with respect to such judgment, costs or expenses and any advancement shall be returned to the Company (without interest) by the Indemnified Person. |
45.3 |
The Directors, on behalf of the Company, may purchase and maintain insurance for the benefit of any Director or Officer against any liability which, by virtue of any rule of law, would otherwise attach to such person in respect of any negligence, default, breach of duty or breach of trust of which such person may be guilty in relation to the Company.
|
46
|
Financial Year
|
47
|
Transfer by Way of Continuation
|
47.1 |
If the Company is exempted as defined in the Statute, it shall, subject to the provisions of the Statute and with the approval of a Special Resolution, have the power to register by way of continuation as a body corporate under the laws of any jurisdiction outside the Cayman Islands and to be deregistered in the Cayman Islands. For the purposes of a Special Resolution to be passed pursuant to this Article, a holder of Class B Shares shall have ten votes for every Class B Share of which he is the holder and a holder of Class A Shares shall have one vote for every Class A Share of which he is the holder.
|
47.2 |
Prior to the closing a Business Combination, Article 47.1 may only be amended by a Special Resolution which shall include the affirmative vote of a simple majority of the Class B Shares.
|
48
|
Mergers and Consolidations
|
49
|
Business Combination
|
49.1 |
Notwithstanding any other provision of the Articles, this Article shall apply during the period commencing upon the adoption of the Articles and terminating upon the first to occur of the consummation of a Business Combination and the full distribution of the Trust Account pursuant to this Article. In the event of a conflict between this Article and any other Articles, the provisions of this Article shall prevail.
|
49.2 |
Prior to the consummation of a Business Combination, the Company shall either:
|
(a) |
submit such Business Combination to its Members for approval; or
|
(b) |
provide Members with the opportunity to have their Shares repurchased by means of a tender offer for a
per-Share
repurchase price payable in cash, equal to the aggregate amount then on deposit in the Trust Account, calculated as of two business days prior to the consummation of such Business Combination, including interest earned on the Trust Account ((net of taxes paid or payable, if
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Auth Code: J29695536021
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any), divided by the number of then issued Public Shares, provided that the Company shall not repurchase Public Shares in an amount that would cause the Company’s net tangible assets to be less than US$5,000,001 prior to or upon consummation of such Business Combination. Such obligation to repurchase Shares is subject to the completion of the proposed Business Combination to which it relates. |
49.3 |
If the Company initiates any tender offer in accordance with Rule
13e-4
and Regulation 14E of the Exchange Act in connection with a proposed Business Combination, it shall file tender offer documents with the Securities and Exchange Commission prior to completing such Business Combination which contain substantially the same financial and other information about such Business Combination and the redemption rights as is required under Regulation 14A of the Exchange Act. If, alternatively, the Company holds a general meeting to approve a proposed Business Combination, the Company will conduct any redemptions in conjunction with a proxy solicitation pursuant to Regulation 14A of the Exchange Act, and not pursuant to the tender offer rules, and file proxy materials with the Securities and Exchange Commission.
|
49.4 |
At a general meeting called for the purposes of approving a Business Combination pursuant to this Article, in the event that such Business Combination is approved by Ordinary Resolution, the Company shall be authorised to consummate such Business Combination, provided that the Company shall not consummate such Business Combination unless the Company has net tangible assets of at least US$5,000,001 immediately prior to, or upon such consummation of, or any greater net tangible asset or cash requirement that may be contained in the agreement relating to, such Business Combination.
|
49.5 |
Any Member holding Public Shares who is not the Sponsor, a Founder, Officer or Director may, at least two business days’ prior to any vote on a Business Combination, elect to have their Public Shares redeemed for cash, in accordance with any applicable requirements provided for in the related proxy materials (the “
IPO Redemption
per-Share
redemption price payable in cash, equal to the aggregate amount then on deposit in the Trust Account calculated as of two business days prior to the consummation of the Business Combination, including interest earned on the Trust Account (such interest shall be net of taxes payable) and not previously released to the Company to pay its taxes, divided by the number of then issued Public Shares (such redemption price being referred to herein as the “
Redemption Price
Redemption Limitation
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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49.6 |
A Member may not withdraw a Redemption Notice once submitted to the Company unless the Directors determine (in their sole discretion) to permit the withdrawal of such redemption request (which they may do in whole or in part).
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49.7 |
In the event that the Company does not consummate a Business Combination by 24 months from the consummation of the IPO (or up to 27 months from the consummation of the IPO if the Company has executed a letter of intent, agreement in principle or definitive agreement for a Business Combination within 24 months from the consummation of the IPO but has not completed a Business Combination within such 24 month period), or such later time as the Members may approve in accordance with the Articles, the Company shall:
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(a) |
cease all operations except for the purpose of winding up;
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(b) |
as promptly as reasonably possible but not more than ten business days thereafter, redeem the Public Shares, at a
per-Share
price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on the funds held in the Trust Account and not previously released to the Company (less taxes payable and up to US$100,000 of interest to pay dissolution expenses), divided by the number of then Public Shares in issue, which redemption will completely extinguish public Members’ rights as Members (including the right to receive further liquidation distributions, if any); and
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(c) |
as promptly as reasonably possible following such redemption, subject to the approval of the Company’s remaining Members and the Directors, liquidate and dissolve,
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49.8 |
In the event that any amendment is made to this Article:
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(a) |
to modify the substance or timing of the Company’s obligation to allow redemption in connection with a Business Combination or redeem 100 per cent of the Public Shares if the Company does not consummate a Business Combination within 24 months from the consummation of the IPO (or up to 27 months from the consummation of the IPO if the Company has executed a letter of intent, agreement in principle or definitive agreement for a Business Combination within 24 months from the consummation of the IPO but has not completed a Business Combination within such 24 month period); or
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(b) |
with respect to any other provision relating to Members’ rights or
pre-Business
Combination activity,
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49.9 |
A holder of Public Shares shall be entitled to receive distributions from the Trust Account only in the event of an IPO Redemption, a repurchase of Shares by means of a tender offer pursuant to this Article, or
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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a distribution of the Trust Account pursuant to this Article. In no other circumstance shall a holder of Public Shares have any right or interest of any kind in the Trust Account. |
49.10 |
After the issue of Public Shares, and prior to the consummation of a Business Combination, the Company shall not issue additional Shares or any other securities that would entitle the holders thereof to:
|
(a) |
receive funds from the Trust Account; or
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(b) |
vote as a class with Public Shares on a Business Combination.
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49.11 |
A Director may vote in respect of a Business Combination in which such Director has a conflict of interest with respect to the evaluation of such Business Combination. Such Director must disclose such interest or conflict to the other Directors.
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49.12 |
As long as the securities of the Company are listed on The Nasdaq Capital Market, the Company must complete one or more Business Combinations having an aggregate fair market value of at least 80 per cent of the assets held in the Trust Account (net of amounts previously disbursed to the Company’s management for taxes and excluding the amount of deferred underwriting discounts held in the Trust Account) at the time of the Company’s signing a definitive agreement in connection with a Business Combination. A Business Combination must not be effectuated with another blank cheque company or a similar company with nominal operations.
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49.13 |
The Company may enter into a Business Combination with a target business that is Affiliated with the Sponsor, a Director or an Officer. In the event the Company seeks to complete a Business Combination with a target that is Affiliated with the Sponsor, a Director or an Officer, the Company, or a committee of Independent Directors, if required by applicable law or based upon the decision of the board of Directors or a committee thereof, will obtain an opinion from an independent investment banking firm or an independent accounting firm that such a Business Combination is fair to the Company from a financial point of view.
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50
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Business Opportunities
|
50.1 |
To the fullest extent permitted by Applicable Law, no individual serving as a Director or an Officer (“
Management
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50.2 |
Except as provided elsewhere in this Article, the Company hereby renounces any interest or expectancy of the Company in, or in being offered an opportunity to participate in, any potential transaction or matter
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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which may be a corporate opportunity for both the Company and Management, about which a Director and/or Officer who is also a member of Management acquires knowledge. |
50.3 |
To the extent a court might hold that the conduct of any activity related to a corporate opportunity that is renounced in this Article to be a breach of duty to the Company or its Members, the Company hereby waives, to the fullest extent permitted by Applicable Law, any and all claims and causes of action that the Company may have for such activities. To the fullest extent permitted by Applicable Law, the provisions of this Article apply equally to activities conducted in the future and that have been conducted in the past.
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www.verify.gov.ky File#: 366479
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Filed:
17-Nov-2020
Auth Code: J29695536021
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Name of Investor: | State/Country of Formation or Domicile: | |||||||
By: |
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Name: |
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Title: |
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Name in which Shares are to be registered (if different): | Date: , 2021 | |||||||
Investor’s EIN: | ||||||||
Business Address-Street: | Mailing Address-Street (if different): | |||||||
City, State, Zip: | City, State, Zip: | |||||||
Attn: |
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Attn: |
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Telephone No.: | Telephone No.: | |||||||
Facsimile No.: | Facsimile No.: | |||||||
Number of Shares subscribed for: | ||||||||
Aggregate Subscription Amount: $ | Price Per Share: $10.00 |
DRAGONEER GROWTH OPPORTUNITIES CORP. II | ||
By: |
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Name: | Pat Robertson | |
Title: | President and Chief Operating Officer |
A. |
QUALIFIED INSTITUTIONAL BUYER STATUS
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B. |
INSTITUTIONAL ACCREDITED INVESTOR STATUS
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1. |
☐ We are an “accredited investor” (within the meaning of Rule 501(a) under the Securities Act or an entity in which all of the equity holders are accredited investors within the meaning of Rule 501(a) under the Securities Act), and have marked and initialed the appropriate box on the following page indicating the provision under which we qualify as an “accredited investor.”
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2. |
☐ We are not a natural person.
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1
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Language to be omitted for individual shareholders.
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2
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Language to be omitted for individual shareholders.
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3
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Language to be omitted for legal entity shareholders.
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4
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Language to be omitted for individual shareholders.
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5
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Language to be included for legal entity shareholders.
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6
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Language to be included for individual shareholders.
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7
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Language to be included for individual shareholders.
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8
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Language to be included for legal entity shareholders.
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c/o Dragoneer Growth Opportunities Corp. II | ||
1 Letterman Drive, Building D, Suite
M-500
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||
San Francisco, CA 94129 | ||
Attention: | Michael Dimitruk | |
Pat Robertson | ||
Email: | Michael@Dragoneer.com | |
Pat@Dragoneer.com |
Ropes & Gray LLP | ||
Three Embarcadero Center | ||
San Francisco, CA 94111 | ||
Attention: | Thomas Holden | |
E-mail:
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thomas.holden@ropesgray.com |
[ ] | ||
[ ] | ||
[ ] | ||
Attention: | [ ] | |
Facsimile: | [ ] | |
Email: | [ ] |
• |
Company Shareholders Agreement*
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DRAGONEER GROWTH OPPORTUNITIES HOLDINGS II
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By: |
/s/ Pat Robertson
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Name: Pat Robertson | ||
Title: Manager | ||
DRAGONEER GROWTH OPPORTUNITIES CORP. II
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By: |
/s/ Pat Robertson
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Name: Pat Robertson | ||
Title: President and Chief Operating Officer | ||
PAPAY TOPCO, INC.
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By: |
/s/ Rajeev K. Aggarwal
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Name: Rajeev K. Aggarwal | ||
Title: Chief Executive Officer |
CLASS B HOLDERS:
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/s/ Marc Stad
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Marc Stad | ||
/s/ Marc Stad
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Pat Robertson | ||
/s/ Sarah Friar
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Sarah J. Friar | ||
/s/ David Ossip
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David D. Ossip | ||
/s/ Gokul Rajaram
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Gokul Rajaram | ||
/s/ Jay Simons
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Jay Simons |
Solely with respect to Section 6:
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By: |
/s/ Marc Stad
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Name: Marc Stad | ||
By: |
/s/ Pat Robertson
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Name: Pat Robertson |
COMPANY:
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CVENT HOLDING CORP.
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By: |
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Name: | ||
Its: | ||
SPONSOR INVESTORS:
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[NAME]
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By: |
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Its: |
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EXECUTIVES:
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[NAME]
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DRAGONEER INVESTORS:
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[NAME]
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By: |
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Its: |
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OTHER INVESTORS:
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[NAME]
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By: |
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Its: |
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Signature of Stockholder | ||
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Print Name of Stockholder | ||
Address: |
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Agreed and Accepted as of | ||
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Cvent Holding Corp.
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By: |
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Its: |
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[ ] | ||
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By: |
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Name: |
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Title: |
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Vista:
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[ ] |
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DRAGONEER SPONSOR:
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[ ] |
1
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Note to Draft
|
1
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Note to Draft
|
1.
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Sale and Purchase.
|
(a) |
Forward Purchase Securities
.
|
(i) |
The Company shall issue and sell to the Purchaser, and the Purchaser shall purchase from the Company, up to the number of Forward Purchase Securities set forth on the Purchaser’s signature page to this Agreement next to the line item “
Maximum Number of Forward Purchase Securities
,” for an aggregate purchase price of $10.00 multiplied by the number of Forward Purchase Securities issued and sold hereunder (the “
FPS Purchase Price
”). The amounts actually sold pursuant to this Section 1(a)(i) shall be determined solely by the Company. For the avoidance of doubt, the Company is not obligated to issue or sell any Forward Purchase Securities.
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(ii) |
The Company shall require the Purchaser to purchase the Forward Purchase Securities pursuant to Section 1(a)(i) hereof by delivering notice (the “
Company Notice
”) to the Purchaser, at least five (5) Business Days before the funding of the FPS Purchase Price to an account specified by the Company, specifying the
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anticipated date of the Business Combination Closing, the number of Forward Purchase Securities being sold by the Company to the Purchaser and each Transferee (as defined in Section 4(d)) pursuant hereto (which will not exceed the number of Forward Purchase Securities that Purchaser has agreed to purchase pursuant to Section 1(a)(i)), the aggregate purchase price for the Forward Purchase Securities (the “
FPS Purchase Price
”) to be purchased by the Purchaser and instructions for wiring the FPS Purchase Price to an account designated by the Company. At least two (2) Business Days before the anticipated date of the Business Combination Closing specified in the Company Notice, the Purchaser shall deliver the FPS Purchase Price in cash via wire transfer to the account specified in such notice, to be held in escrow pending the Business Combination Closing. If the Business Combination Closing does not occur within thirty (30) days after the Purchaser delivers the FPS Purchase Price to such account, the Company shall return to the Purchaser the FPS Purchase Price, provided that the return of the FPS Purchase Price placed in escrow shall not terminate this Agreement or otherwise relieve either party of any of its obligations hereunder and the Company may provide a subsequent Company Notice pursuant to this Section 1(a)(ii). For the purposes of this Agreement, “
Business Day
” means any day, other than a Saturday or a Sunday, that is neither a legal holiday nor a day on which banking institutions are generally authorized or required by law or regulation to close in the City of New York, New York.
|
(iii) |
The closing of the sale of the Forward Purchase Securities (the “
FPS Closing
”) shall be held on the same date and immediately prior to the Business Combination Closing (such date being referred to as the “
Closing Date
”); provided, that at the Purchaser’s request, the FPS Closing may occur up to seven (7) days prior the Business Combination Closing. At the FPS Closing, the Company will issue to the Purchaser the number of Forward Purchase Securities each registered in the name of the respective Purchaser.
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(iv) |
Notwithstanding the foregoing, to the extent the Purchaser does not have sufficient capital to fulfill its commitments to purchase some or all of the Forward Purchase Securities pursuant to the terms of this Agreement, Dragoneer Global Fund II, L.P. (“
DGF II
”), Dragoneer Opportunities Fund V, L.P. (“
DOF V
”) or any of their affiliates shall be obligated to contribute such amounts to the Purchaser in order for the Purchaser to make such purchase. Provided further that Dragoneer Investment Group, LLC (the “
Investment Manager
”) may assign the commitments under this section to any other funds managed by the Investment Manager as it determines in its sole discretion.
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(b) |
Delivery of Forward Purchase Securities
.
|
(i) |
The Company shall register the Purchaser as the owner of the number of Forward Purchase Securities with the Company’s transfer agent by book entry on or promptly after (but in no event more than two (2) Business Days after) the FPS Closing Date.
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(ii) |
Each book entry for the Forward Purchase Securities shall contain a notation, and each certificate (if any) evidencing the Forward Purchase Securities shall be stamped or otherwise imprinted with a legend, in substantially the following form:
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“THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE OR OTHER
|
JURISDICTION, AND MAY NOT BE TRANSFERRED IN VIOLATION OF SUCH ACT AND LAWS.” |
(c) |
Legend Removal
. If the Forward Purchase Securities are eligible to be sold without restriction under, and without the Company being in compliance with the current public information requirements of, Rule 144 under the Securities Act of 1933, as amended (the “
Securities Act
”), or there is an effective registration statement covering the resale of the Forward Purchase Securities (and the Purchaser provides the Company with a written undertaking to sell its Forward Purchase Securities only in accordance with the plan of distribution contained in such registration statement and only if the Purchaser has not been informed that the prospectus in such registration statement is not current or the registration statement is no longer effective), then at the Purchaser’s request, the Company will cause the Company’s transfer agent to remove the legend set forth in Section 1(b)(ii). In connection therewith, if required by the Company’s transfer agent, the Company will promptly cause an opinion of counsel to be delivered to and maintained with its transfer agent, together with any other authorizations, certificates and directions required by the transfer agent that authorize and direct the transfer agent to transfer such Forward Purchase Securities without any such legend; provided that, notwithstanding the foregoing, the Company will not be required to deliver any such opinion, authorization, certificate or direction if it reasonably believes that removal of the legend could result in or facilitate transfers of Forward Purchase Securities in violation of applicable law.
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(d) |
Registration Rights
. The Purchaser shall have registration rights as set forth on
Exhibit A
Registration Rights
”).
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2.
|
Representations and Warranties of the Purchaser
|
(a) |
Restricted Securities
. The Purchaser understands that the offer and sale of the Forward Purchase Securities have not been registered under the Securities Act, by reason of a specific exemption from the registration provisions of the Securities Act that depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the Purchaser’s representations as expressed herein. The Purchaser understands that the Forward Purchase Securities are “restricted securities” under applicable U.S. federal and state securities laws and that, pursuant to these laws, the Purchaser must hold the Forward Purchase Securities indefinitely unless they are registered with the SEC and qualified by state authorities, or an exemption from such registration and qualification requirements is available. The Purchaser acknowledges that the Company has no obligation to register or qualify the Forward Purchase Securities, or any Class A Shares into which they may be converted into or exercised for, for resale, except pursuant to the Registration Rights. The Purchaser further acknowledges that if an exemption from registration or qualification is available, it may be conditioned on various requirements including, but not limited to, the time and manner of sale, the holding period for the Forward Purchase Securities, and on requirements relating to the Company that are outside of the Purchaser’s control, and which the Company is under no obligation and may not be able to satisfy. The Purchaser acknowledges that the Company filed the Registration Statement for its proposed IPO to the SEC for review. The Purchaser understands that the offering to the Purchaser of the Forward Purchase Securities is not, and is not intended to be, part of the IPO, and that the Purchaser will not be able to rely on the protection of Section 11 of the Securities Act with respect to such Forward Purchase Securities.
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(b) |
No General Solicitation
. Neither the Purchaser, nor any of its officers, directors, employees, agents, shareholders or partners, has either directly or indirectly, including, through a broker or finder (i) to its knowledge, engaged in any general solicitation, or (ii) published any advertisement in connection with the offer and sale of the Forward Purchase Securities.
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(c) |
No Other Representations and Warranties;
. Except for the specific representations and warranties contained in this Section 2 and in any certificate or agreement delivered pursuant hereto, none of the Purchaser nor any person acting on behalf of the Purchaser nor any of the Purchaser’s affiliates (the “
Non-Reliance
Purchaser Parties
”) has made, makes or shall be deemed to make any other express or implied representation or warranty with respect to the Purchaser and this offering, and the Purchaser Parties disclaim any such representation or warranty. Except for the specific representations and warranties expressly made by the Company in Section 3 of this Agreement and in any certificate or agreement delivered pursuant hereto, the Purchaser Parties specifically disclaim that they are relying upon any other representations or warranties that may have been made by the Company.
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3.
|
Representations and Warranties of the Company
|
(a) |
Incorporation and Corporate Powe
r. The Company is duly incorporated and validly existing and in good standing as an exempted company under the laws of the Cayman Islands and has all requisite corporate power and authority to carry on its business as presently conducted and as proposed to be conducted. The Company has no subsidiaries.
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(b) |
Capitalization
. As of the date of this Agreement, the authorized share capital of the Company consists of:
|
(i) |
200,000,000 Class A Shares, none of which are issued and outstanding.
|
(ii) |
20,000,000 Class B ordinary shares of the Company, par value $0.0001 per share (“
Class
B Share(s)
”), 5,750,000 of which are issued and outstanding (750,000 of which are subject to forfeiture to the extent that the underwriters’ over-allotment option in connection with the IPO is not exercised in full). All of the issued and outstanding Class B Shares have been duly authorized, are fully paid and nonassessable and were issued in compliance with all applicable federal and state securities laws.
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(iii) |
1,000,000 preference shares, none of which are issued and outstanding.
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(c) |
Authorization
. All corporate action required to be taken by the Company’s Board of Directors and shareholders in order to authorize the Company to enter into this Agreement, and to issue the Forward Purchase Securities at the FPS Closing, and the securities issuable upon conversion or exercise of the Forward Purchase Securities, has been taken or will be taken prior to the FPS Closing. All action on the part of the shareholders, directors and officers of the Company necessary for the execution and delivery of this Agreement, the performance of all obligations of the Company under this Agreement to be performed as of the FPS Closing and the issuance and delivery of the Forward Purchase Securities and the securities issuable upon conversion or exercise of the Forward Purchase Securities has been taken or will be taken prior to the FPS Closing. This Agreement, when executed and delivered by the Company, shall constitute the valid and legally binding obligation of the Company, enforceable against the Company in accordance with its terms except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, or other laws of general application relating to or affecting the enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies, or (iii) to the extent the indemnification provisions contained in the Registration Rights may be limited by applicable federal or state securities laws.
|
(d) |
Valid Issuance of Forward Purchase Securities
. The Forward Purchase Securities, when issued, sold and delivered in accordance with the terms and for the consideration set forth in this Agreement and the Company’s memorandum and articles of association (the “
Charter
”),
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and the securities issuable upon conversion or exercise of the Forward Purchase Securities, when issued in accordance with the terms of this Agreement, and registered in the register of members of the Company, will be validly issued, fully paid and nonassessable and free of all preemptive or similar rights, taxes, liens, encumbrances and charges with respect to the issue thereof and restrictions on transfer other than restrictions on transfer specified under this Agreement, applicable state and federal securities laws and liens or encumbrances created by or imposed by the Purchaser. Assuming the accuracy of the representations of the Purchaser in this Agreement and subject to the filings described in Section 3(e) below, the Forward Purchase Securities will be issued in compliance with all applicable federal and state securities laws. |
(e) |
Governmental Consents and Filings
. Assuming the accuracy of the representations and warranties made by the Purchaser in this Agreement, no consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing with, any federal, state or local governmental authority is required on the part of the Company in connection with the consummation of the transactions contemplated by this Agreement, except for applicable requirements of the Securities Act and applicable state securities laws.
|
(f)
|
Compliance with Other Instruments
. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated by this Agreement will not result in any violation or default (i) of any provisions of its Charter or other governing documents, (ii) of any instrument, judgment, order, writ or decree to which it is a party or by which it is bound, (iii) under any note, indenture or mortgage to which it is a party or by which it is bound, (iv) under any lease, agreement, contract or purchase order to which it is a party or by which it is bound or (v) of any provision of federal or state statute, rule or regulation applicable to the Company, in each case (other than clause (i)) which would have a material adverse effect on the Company or its ability to consummate the transactions contemplated by this Agreement.
|
(g) |
Operations
. As of the date hereof, the Company has not conducted, and prior to the IPO Closing the Company will not conduct, any operations other than organizational activities and activities in connection with offerings of its securities.
|
|
(h) |
Foreign Corrupt Practices
. Neither the Company, nor any director, officer, agent, employee or other Person acting on behalf of the Company has, in the course of its actions for, or on behalf of, the Company (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (iii) violated or is in violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977, as amended; or (iv) made any unlawful bribe, rebate, payoff, influence payment, kickback or other unlawful payment to any foreign or domestic government official or employee.
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(i)
|
Compliance with Anti-Money Laundering Laws
. The operations of the Company are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements and all other applicable
U.S. and
non-U.S.
Anti-Money Laundering Laws
”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company with respect to the Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
|
(j) |
Absence of Litigation
. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the Company, threatened against or affecting the Company or any of the Company’s officers or directors, whether of a civil or criminal nature or otherwise, in their capacities as such.
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(k) |
No General Solicitation
. Neither the Company, nor any of its officers, directors, employees, agents or shareholders has either directly or indirectly, including, through a broker or finder (i) engaged in any general solicitation, or (ii) published any advertisement in connection with the offer and sale of the Forward Purchase Securities.
|
(l) |
No Other Representations and Warranties;
. Except for the specific representations and warranties contained in this Section 3 and in any certificate or agreement delivered pursuant hereto, the Company has not made and does not make nor shall be deemed to make any other express or implied representation or warranty with respect to the Company, this offering, the proposed IPO or a potential Business Combination, and the Company disclaims any such representation or warranty. Except for the specific representations and warranties expressly made by the Purchaser in Section 2 of this Agreement and in any certificate or agreement delivered pursuant hereto, the Company specifically disclaims that it is relying upon any other representations or warranties that may have been made by the Purchaser Parties.
Non-Reliance
|
4.
|
Additional Agreements and Acknowledgements and Waivers of the Purchaser
|
(a) |
Trust Account
.
|
(i) |
The Purchaser hereby acknowledges that it is aware that the Company will establish a trust account (the “
Trust Account
”) for the benefit of its public shareholders upon the closing of the IPO. The Purchaser, for itself and its affiliates, hereby agrees that it has no right, title, interest or claim of any kind in or to any monies held in the Trust Account, or any other asset of the Company as a result of any liquidation of the Company, except for redemption and liquidation rights, if any, the Purchaser may have in respect of any Class A Shares held by it.
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(ii) |
The Purchaser hereby agrees that it shall have no right of
set-off
or any right, title, interest or claim of any kind (“
Claim
”) to, or to any monies in, the Trust Account, and hereby irrevocably waives any Claim to, or to any monies in, the Trust Account that it may have now or in the future, except for redemption and liquidation rights, if any, the Purchaser may have in respect of any Class A Shares held by it. In the event the Purchaser has any Claim against the Company under this Agreement, the Purchaser shall pursue such Claim solely against the Company and its assets outside the Trust Account and not against the property or any monies in the Trust Account, except for redemption and liquidation rights, if any, the Purchaser may have in respect of any Class A Shares held by it.
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(b) |
Redemption and Liquidation
. The Purchaser hereby waives, with respect to any Forward Purchase Securities held by it, any redemption rights it may have in connection with (i) the consummation of a Business Combination, including any such rights available in the context of a shareholder vote to approve such Business Combination and (ii) any shareholder vote to approve an amendment to the Charter (A) to modify the substance or timing of the Company’s obligation to redeem 100% of the Company’s Class A Shares if the Company does not complete its Business Combination within 24 months (or 27 months, as applicable) after the closing of the IPO or (B) with respect to any other provisions relating to the rights of the Company’s Class A Shares, it being understood that the Purchaser shall be entitled to redemption and liquidation rights with respect to any Class A Shares held by it.
|
(c) |
Voting
. The Purchaser hereby agrees that if the Company seeks shareholder approval of a proposed Business Combination, then in connection with such proposed Business Combination, the Purchaser shall vote any Class A Shares owned by it in favor of any proposed Business Combination. If the Purchaser fails to vote any Class A Shares it is required to vote hereunder in favor of a Proposed Business Combination, the Purchaser hereby grants to the Company and any representative designated by the Company without further action by the Purchaser a limited irrevocable power of attorney to effect such vote on behalf of the Purchaser, which power of attorney shall be deemed to be coupled with an interest.
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(d) |
Transfer
. This Agreement and all of the Purchaser’s rights and obligations hereunder (including the Purchaser’s obligation to purchase the Forward Purchase Securities) may be transferred or assigned, at any time and from time to time, in whole or in part, to one or more affiliates of Purchaser, but not to other third parties (each such transferee, a “
Transferee
”). Upon any such assignment:
|
(i) |
the applicable Transferee shall execute a signature page to this Agreement, substantially in the form of the Purchaser’s signature page hereto (the “
Joinder Agreement
”), which shall reflect the maximum number of Forward Purchase Securities to be purchased by such Transferee (the “
Transferee Securities
”), and, upon such execution, such Transferee shall have all the same rights and obligations of the Purchaser hereunder with respect to the Transferee Securities, and references herein to the “Purchaser” shall be deemed to refer to and include any such Transferee with respect to such Transferee and to its Transferee Securities; provided, that any representations, warranties, covenants and agreements of the Purchaser and any such Transferee shall be several and not joint and shall be made as to the Purchaser or any such Transferee, as applicable, as to itself only; and
|
(ii) |
upon a Transferee’s execution and delivery of a Joinder Agreement, the maximum number of Forward Purchase Securities to be purchased by the Purchaser hereunder shall be reduced by the maximum number of Forward Purchase Securities to be purchased by the applicable Transferee pursuant to the applicable Joinder Agreement, which reduction shall be evidenced by the Purchaser and the Company amending Schedule A to this Agreement to reflect each transfer and updating the “Maximum Number of Forward Purchase Securities” and “Aggregate Purchase Price for Forward Purchase Securities” on the Purchaser’s signature page hereto to reflect such reduced number of Forward Purchase Securities, and each of the Transferee’s and the Purchaser’s purchase obligations shall be subject to allocation pursuant to Section 1(a)(i) herein. For the avoidance of doubt, this Agreement need not be amended and restated in its entirety, but only Schedule A and the Purchaser’s signature page hereto need be so amended and updated and executed by each of the Purchaser and the Company upon the occurrence of any such transfer of Transferee Securities.
|
5.
|
Additional Agreement of the Company
|
(a) |
Nasdaq Listing
. The Company will use commercially reasonable efforts to effect the listing of the Class A Shares on The Nasdaq Capital Market (or another national securities exchange).
|
(b) |
QEF Election Information
. Until the Business Combination, Dragoneer Growth Opportunities Holdings II (the “
Sponsor
”) shall use commercially reasonable efforts to determine whether, in any year, the Company or any subsidiary of the Company is deemed to be a “passive foreign investment company” (a “
PFIC
”) within the meaning of U.S. Internal
|
Revenue Code of 1986, as amended, and the regulations promulgated thereunder (collectively, the “
Code
”). Until the Business Combination, if the Sponsor determines that the Company or any subsidiary of the Company is a PFIC in any year, for the year of determination and for each year thereafter during which the Purchaser holds an equity interest in the Company, the Company or its subsidiary shall use commercially reasonable efforts to (i) make available to the Purchaser the information that may be required to make or maintain a “qualified electing fund” election under the Code with respect to the Company and (ii) furnish the information required to be reported under Section 1298(f) of the Code and/or, upon request, necessary in order to make the election described in Section 1291(d)(2)(B) of the Code.
|
6.
|
FPS Closing Conditions
|
(a) |
The obligation of the Purchaser to purchase the Forward Purchase Securities at the FPS Closing under this Agreement shall be subject to the fulfillment, at or prior to the FPS Closing of each of the following conditions, any of which, to the extent permitted by applicable laws, may be waived by the Purchaser:
|
(i) |
the Business Combination shall be consummated substantially concurrently with, and immediately following, the purchase of Forward Purchase Securities;
|
(ii) |
The Company shall have delivered to the Purchaser a certificate evidencing the Company’s good standing as a Cayman Islands exempted limited company, as of a date within ten (10) Business Days of the FPS Closing;
|
(iii) |
the representations and warranties of the Company set forth in Section 3 of this Agreement shall have been true and correct as of the date hereof and shall be true and correct, in the case of the Company, as of the FPS Closing, as applicable, with the same effect as though such representations and warranties had been made on and as of such date (other than any such representation or warranty that is made by its terms as of a specified date, which shall be true and correct as of such specified date), except, in the case of the Company, where the failure to be so true and correct would not have a material adverse effect on the Company or its ability to consummate the transactions contemplated by this Agreement;
|
(iv) |
the Company shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company at or prior to the FPS Closing; and
|
(v) |
no order, writ, judgment, injunction, decree, determination, or award shall have been entered by or with any governmental, regulatory, or administrative authority or any court, tribunal, or judicial, or arbitral body, and no other legal restraint or prohibition shall be in effect, preventing the purchase by the Purchaser of the Forward Purchase Securities.
|
(b) |
The obligation of the Company to sell the Forward Purchase Securities at the FPS Closing under this Agreement shall be subject to the fulfillment, at or prior to the FPS Closing of each of the following conditions, any of which, to the extent permitted by applicable laws, may be waived by the Company:
|
(i) |
the Business Combination shall be consummated substantially concurrently with, and immediately following, the purchase of Forward Purchase Securities;
|
(ii) |
the representations and warranties of the Purchaser set forth in Section 2 of this Agreement shall have been true and correct as of the date hereof and shall be true
|
and correct as of the FPS Closing, as applicable, with the same effect as though such representations and warranties had been made on and as of such date (other than any such representation or warranty that is made by its terms as of a specified date, which shall be true and correct as of such specified date), except where the failure to be so true and correct would not have a material adverse effect on the Purchaser or its ability to consummate the transactions contemplated by this Agreement; |
(iii) |
the Purchaser shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Purchaser at or prior to the FPS Closing; and
|
(iv) |
no order, writ, judgment, injunction, decree, determination, or award shall have been entered by or with any governmental, regulatory, or administrative authority or any court, tribunal, or judicial, or arbitral body, and no other legal restraint or prohibition shall be in effect, preventing the purchase by the Purchaser of the Forward Purchase Securities.
|
7.
|
Termination
|
(a) |
by mutual written consent of the Company and the Purchaser;
|
(b) |
automatically
|
(i) |
if the IPO is not consummated on or prior to February 28, 2021;
|
(ii) |
if the Business Combination is not consummated within twenty-four (24) months from the closing of the IPO (or twenty-seven (27) months from the closing of the IPO if the Company has executed a letter of intent, agreement in principle or definitive agreement for the Business Combination within twenty-four (24) months from the closing of the IPO but has not completed the Business Combination within such twenty-four (24) month period), unless extended upon approval of the Company’s shareholders in accordance with the Charter; or
|
(iii) |
if the Company becomes subject to any voluntary or involuntary petition under the United States federal bankruptcy laws or any state insolvency law, in each case which is not withdrawn within sixty (60) days after being filed, or a receiver, fiscal agent or similar officer is appointed by a court for business or property of the Company, in each case which is not removed, withdrawn or terminated within sixty (60) days after such appointment;
|
In the event of any termination of this Agreement pursuant to this Section 7, the FPS Purchase Price (and interest thereon, if any), if previously paid, and the Purchaser’s funds paid in connection herewith shall be promptly returned to the Purchaser, and thereafter this Agreement shall forthwith become null and void and have no effect, without any liability on the part of the Purchaser or the Company and their respective directors, officers, employees, partners, managers, members, or shareholders and all rights and obligations of each party shall cease;
provided
,
however
, that nothing contained in this Section 7 shall relieve any party from liabilities or damages arising out of any fraud or willful breach by such party of any of its representations, warranties, covenants or agreements contained in this Agreement.
|
8.
|
General Provisions
|
(a) |
Notices
. All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed effectively given upon the earlier of actual receipt, and (a) personal delivery to the party to be notified, (b) when sent, if sent by electronic mail
|
or facsimile (if any) during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient’s next Business Day, (c) five (5) Business Days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) Business Day after deposit with a nationally recognized overnight courier, freight prepaid, specifying next Business Day delivery, with written verification of receipt. All communications sent to the Company shall be sent to: Dragoneer Growth Opportunities Corp. II, c/o Dragoneer Investment Group, LLC, One Letterman Drive, Building D, Suite M500, San Francisco, California 94129, Attn: Michael Dimitruk, email: michael@dragoneer.com, with a copy to the Company’s counsel at: Ropes & Gray LLP, 1211 Avenue of the Americas, New York, NY 10036-8704, Attn: Paul Tropp, Esq., email: paul.tropp@ropesgray.com. |
All communications to the Purchaser shall be sent to the Purchaser’s address as set forth on the signature page hereof, or to such
e-mail
address, facsimile number (if any) or address as subsequently modified by written notice given in accordance with this Section 8(a).
|
(b) |
No Finder’s Fees
. Each of the parties represents that it neither is nor will be obligated for any finder’s fee or commission in connection with this transaction. The Purchaser agrees to indemnify and to hold harmless the Company from any liability for any commission or compensation in the nature of a finder’s or broker’s fee arising out of this transaction (and the costs and expenses of defending against such liability or asserted liability) for which the Purchaser or its respective officers, employees or representatives is responsible. The Company agrees to indemnify and hold harmless the Purchaser from any liability for any commission or compensation in the nature of a finder’s or broker’s fee arising out of this transaction (and the costs and expenses of defending against such liability or asserted liability) for which the Company or any of its officers, employees or representatives is responsible.
|
(c) |
Survival of Representations and Warranties
. All of the representations and warranties contained herein shall survive the FPS Closing.
|
(d) |
Entire Agreement
. This Agreement, together with any documents, instruments and writings that are delivered pursuant hereto or referenced herein, constitutes the entire agreement and understanding of the parties hereto in respect of its subject matter and supersedes all prior understandings, agreements, or representations by or among the parties hereto, written or oral, to the extent they relate in any way to the subject matter hereof or the transactions contemplated hereby.
|
(e) |
Successors
. All of the terms, agreements, covenants, representations, warranties, and conditions of this Agreement are binding upon, and inure to the benefit of and are enforceable by, the parties hereto and their respective successors. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement
.
|
(f) |
Assignments
. Except as otherwise specifically provided herein, no party hereto may assign either this Agreement or any of its rights, interests, or obligations hereunder without the prior written approval of the other parties.
|
(g) |
Counterparts
. This Agreement may be executed in two or more counterparts, each of which will be deemed an original but all of which together will constitute one and the same instrument.
|
(h) |
Headings
. The section headings contained in this Agreement are inserted for convenience only and will not affect in any way the meaning or interpretation of this Agreement.
|
(i) |
Governing Law
. This Agreement, the entire relationship of the parties hereto, and any dispute between the parties (whether grounded in contract, tort, statute, law or equity) shall be governed by, construed in accordance with, and interpreted pursuant to the laws of the State of New York, without giving effect to its choice of laws principles.
|
(j) |
Jurisdiction
. The parties hereto (i) hereby irrevocably and unconditionally submit to the jurisdiction of the state courts of New York and to the jurisdiction of the United States District Court for the Southern District of New York for the purpose of any suit, action or other proceeding arising out of or based upon this Agreement, (b) agree not to commence any suit, action or other proceeding arising out of or based upon this Agreement except in state courts of New York or the United States District Court for the Southern District of New York, and (c) hereby waive, and agree not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court.
|
(k) |
WAIVER OF JURY TRIAL
. THE PARTIES HERETO HEREBY WAIVE ANY RIGHT TO A JURY TRIAL IN CONNECTION WITH ANY LITIGATION PURSUANT TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY.
|
(l) |
Amendments
. This Agreement may not be amended, modified or waived as to any particular provision, except with the written consent of the Company and the Purchaser.
|
(m) |
Severability
. The provisions of this Agreement will be deemed severable and the invalidity or unenforceability of any provision will not affect the validity or enforceability of the other provisions hereof; provided that if any provision of this Agreement, as applied to any party hereto or to any circumstance, is adjudged by a governmental authority, arbitrator, or mediator not to be enforceable in accordance with its terms, the parties hereto agree that the governmental authority, arbitrator, or mediator making such determination will have the power to modify the provision in a manner consistent with its objectives such that it is enforceable, and/or to delete specific words or phrases, and in its reduced form, such provision will then be enforceable and will be enforced.
|
(n) |
Expenses
. Each of the Company and the Purchaser will bear its own costs and expenses incurred in connection with the preparation, execution and performance of this Agreement and the consummation of the transactions contemplated hereby, including all fees and expenses of agents, representatives, financial advisors, legal counsel and accountants. The Company shall be responsible for the fees of its transfer agent; stamp taxes and all The Depository Trust Company fees associated with the issuance of the Securities and the securities issuable upon conversion or exercise of the Forward Purchase Securities.
|
(o) |
Construction
. The parties hereto have participated jointly in the negotiation and drafting of this Agreement. If an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the parties hereto and no presumption or burden of proof will arise favoring or disfavoring any party hereto because of the authorship of any provision of this Agreement. Any reference to any federal, state, local, or foreign law will be deemed also to refer to law as amended and all rules and regulations promulgated thereunder, unless the context requires otherwise. The words “include,” “includes,” and “including” will be deemed to be followed by “without limitation.” Pronouns in masculine, feminine, and neuter genders will be construed to include any other gender, and words in the singular form will be construed to include the plural and vice versa, unless the context otherwise requires. The words “this Agreement,” “herein,” “hereof,” “hereby,” “hereunder,” and words of
|
similar import refer to this Agreement as a whole and not to any particular subdivision unless expressly so limited. The parties hereto intend that each representation, warranty, and covenant contained herein will have independent significance. If any party hereto has breached any representation, warranty, or covenant contained herein in any respect, the fact that there exists another representation, warranty or covenant relating to the same subject matter (regardless of the relative levels of specificity) which such party hereto has not breached will not detract from or mitigate the fact that such party hereto is in breach of the first representation, warranty, or covenant. |
(p) |
Waiver
. No waiver by any party hereto of any default, misrepresentation, or breach of warranty or covenant hereunder, whether intentional or not, may be deemed to extend to any prior or subsequent default, misrepresentation, or breach of warranty or covenant hereunder or affect in any way any rights arising because of any prior or subsequent occurrence.
|
(q) |
Confidentiality
. Except as may be required by law, regulation or applicable stock exchange listing requirements, unless and until the transactions contemplated hereby and the terms hereof are publicly announced or otherwise publicly disclosed by the Company, the parties hereto shall keep confidential and shall not publicly disclose the existence or terms of this Agreement.
|
COMPANY:
|
||||||||
DRAGONEER GROWTH OPPORTUNITIES CORP. II | Dragoneer Investment Group, LLC, One Letterman Drive, Building D, Suite M500, San Francisco, California 94129, Attn: Michael Dimitruk | |||||||
By: |
/s/ Pat Robertson
|
|||||||
Name: | Pat Robertson | |||||||
Title: | President and Chief Operating Officer |
Maximum Number of Forward Purchase Securities:
|
5,000,000 | |||
Aggregate Purchase Price for Maximum Number of Forward Purchase Securities:
|
$ | 50,000,000 |
1. |
The Company shall use its reasonable best efforts to (i) within thirty (30) days after the Business Combination Closing, file a registration statement for a secondary offering (including any successor registration statement covering the resale of the Registrable Securities, a “
Resale Shelf
”) of (x) the Class A Shares comprising the Forward Purchase Securities, (y) any other Class A Shares that may be acquired by the Purchaser after the date of this Agreement, including any time after the Business Combination Closing and (z) any other equity security of the Company issued or issuable with respect to the securities referred to in clauses (x) and (y) by way of a share capitalization or share split or in connection with a combination of shares, recapitalization, merger, consolidation or reorganization (collectively, the “
Registrable Securities
”) for an offering to be made on a continuous basis pursuant to Rule 415 of the Securities Act registering the resale of the Registrable Securities from time to time;
provided
, that if Form
S-3
is unavailable for such a registration, the Company shall register the resale of the Registrable Securities on another appropriate form and undertake to register the Registrable Securities on Form
S-3
as soon as such form is available, (ii) cause the Resale Shelf to be declared effective under the Securities Act promptly thereafter, but in no event later than ninety (90) days after the closing of the Business Combination and (iii) maintain the effectiveness of such Resale Shelf with respect to the Purchaser’s Registrable Securities and to ensure the Resale Shelf does not contain a material omission or misstatement, including by way of amendment or other update, as required, until the earlier of (A) the date on which the Purchaser ceases to hold Registrable Securities covered by such Resale Shelf and (B) the date all of the Purchaser’s Registrable Securities covered by the Resale Shelf can be sold publicly without restriction or limitation under Rule 144 under the Securities Act and without the requirement to be in compliance with Rule 144(c)(1) under the Securities Act; and
provided
,
further
, with respect to Registrable Securities acquired after the Business Combination Closing, the Company shall only be obligated to amend the Resale Shelf or file a new registration statement that will constitute a Resale Shelf to include such Registrable Securities on two (2) occasions, each upon the written request of the Purchaser with respect to at least 100,000 Registrable Securities.
|
2. |
In the event the Company is prohibited by applicable rule, regulation or interpretation by the staff (“
Staff
”) of the Securities and Exchange Commission (“
SEC
”) from registering all of the Registrable Securities on the Resale Shelf or the Staff requires that the Purchaser be specifically identified as an “underwriter” in order to permit such registration statement to become effective, and the Purchaser does not consent in writing to being so named as an underwriter in such registration statement, the Company agrees to promptly (i) inform each of the holders thereof and use its reasonable best efforts to file amendments to the Resale Shelf as required by the SEC and/or (ii) withdraw the Resale Shelf and file a new registration statement (a “
New Registration Statement
”), on Form
S-3,
or if Form
S-3
is not then available to the Company for such registration statement, on such other form available to register for resale the Registrable Securities as a secondary offering; the number of Registrable Securities to be registered on the Resale Shelf will be reduced on a pro rata basis among all the holders of Registrable Securities to be so included, unless otherwise required by the Staff, so that the number of Registrable Securities to be registered is permitted by Staff and the Purchaser is not required to be named as an “underwriter”;
provided
, that any Registrable Securities not registered due to this paragraph 2 shall thereafter as soon as allowed by the SEC guidance be registered to the extent the prohibition no longer is applicable.
|
3. |
If at any time the Company proposes to file a registration statement (a “
Registration Statement
”) on its own behalf, or on behalf of any other Persons who have registration rights (“
Other Holders
”), relating to an underwritten offering of ordinary shares, or engage in an Underwritten Shelf Takedown (as defined below) off an existing registration statement (a “
Company Offering
”), then the Company will provide the Purchaser with notice in writing (an “
Offer Notice
”) at least five (5) Business Days prior to such filing, which Offer Notice will offer to include in the Registration Statement, the Purchaser’s Registrable Securities. Within five (5) Business Days (or, in the case of an Offer Notice delivered to
|
the Purchaser in connection with an Underwritten Shelf Takedown, within three (3) Business Days) after receiving the Offer Notice, a Purchaser may make a written request to the Company to include some or all of the Purchaser’s Registrable Securities in the Registration Statement. If the underwriter(s) for any Company Offering advise the Company that marketing factors require a limitation on the number of securities that may be included in the Company Offering, the number of securities to be so included shall be allocated as follows: (i) first, to the Company and the Other Holders, if any; and (ii) second, to the requesting Purchaser. |
4. |
At any time during which the Company has an effective Resale Shelf with respect to the Purchaser’s Registrable Securities, the Purchaser may make a written request (which request shall specify the intended method of disposition thereof) (a “
Shelf Takedown Request
”) to the Company to effect a sale, of all or a portion of the Purchaser’s Registrable Securities that are covered by the Resale Shelf, and the Company shall use commercially reasonable efforts to file, to the extent required by applicable law or regulation, a prospectus supplement (a “
Shelf Takedown Prospectus Supplement
”) for such purpose as soon as reasonably practicable following receipt of a Shelf Takedown Request. The Purchaser may request that any such sale be conducted as an underwritten public offering (an “
Underwritten Shelf Takedown
”).
|
5. |
The determination of whether any offering of Registrable Securities pursuant to the Resale Shelf or a Shelf Takedown Prospectus Supplement will be an Underwritten Shelf Takedown shall be made in the sole discretion of the Purchaser(s), after consultation with the Company, and the Purchaser(s) shall have the right, after consultation with the Company, to determine the plan of distribution, including the price at which the Registrable Securities are to be sold and the underwriting commissions, discounts and fees. The Purchaser(s) shall select the investment banker or bankers and managers to administer the offering, including the lead managing underwriter (provided that such investment banker or bankers and managers shall be reasonably satisfactory to the Company).
|
6. |
In connection with any Underwritten Shelf Takedown, the Company shall enter into such customary agreements and take all such other actions in connection therewith (including those requested by the Purchaser) in order to facilitate the disposition of such Registrable Securities as are reasonably necessary or required, and in such connection enter into a customary underwriting agreement that provides for customary opinions, comfort letters and officer’s certificates and other customary deliverables.
|
7. |
The Company shall pay all fees and expenses incident to the performance of or compliance with its obligation to prepare, file and maintain the Resale Shelf (including the fees of its counsel and accountants). The Company shall also pay all Registration Expenses. For purposes of this paragraph 7, “
Registration Expenses
” shall mean the
out-of-pocket
provided
|
8. |
The Company may suspend the use of a prospectus included in the Resale Shelf by furnishing to the Purchaser a written notice (“
Suspension Notice
”) stating that in the good faith judgment of the Company, it would be either (i) prohibited by the Company’s insider trading policy (as if the Purchaser were covered by such policy) or (ii) materially detrimental to the Company and its shareholders for such prospectus to be used at such time. The Company’s right to suspend the use of such prospectus under clause (ii) of the preceding sentence may be exercised for a period of not more than sixty (60) days after the date of such notice to the Purchaser; provided such period may be extended for an additional thirty (30) days with the consent of a
majority-in-interest
End of Suspension Notice
”) from the Company to the holders. The Company shall act in good faith to permit any suspension period contemplated by this paragraph to be concluded as promptly as reasonably practicable.
|
9. |
The Purchaser agrees that, except as required by applicable law, the Purchaser shall treat as confidential the receipt of any Suspension Notice (provided that in no event shall such notice contain any material nonpublic information of the Company) hereunder and shall not disclose or use the information contained in such Suspension Notice without the prior written consent of the Company until such time as the information contained therein is or becomes public, other than as a result of disclosure by a holder of Registrable Securities in breach of the terms of this Agreement.
|
10. |
The Company shall indemnify and hold harmless the Purchaser, its directors and officers, partners, members, managers, affiliates, employees, agents, and representatives of the Purchaser and each person, if any, who controls the Purchaser within the meaning of the Securities Act and the Securities Exchange Act of 1934, as amended (the “
Exchange Act
”), and the officers, directors, partners, members, managers, agents, affiliates, employees and investment advisers of each such controlling person (collectively, “
Indemnified Persons
”), to the fullest extent permitted by applicable law, from and against any losses, claims, damages, liabilities, joint or several, costs (including reasonable costs of preparation and reasonable attorneys’ fees) and expenses, judgments, fines, penalties, interest, settlements or other amounts arising from any and all claims, demands, actions, suits or proceedings, whether civil, criminal, administrative or investigative, in which any Indemnified Person may be involved, or is threatened to be involved, as a party or otherwise, under the Securities Act or otherwise (collectively, “
Losses
”), promptly as incurred, arising out of, based upon or resulting from any untrue statement or alleged untrue statement of any material fact contained in the Resale Shelf (or any amendment or supplement thereto), the related prospectus, or any amendment or supplement thereto, or arise out of, are based upon or resulting from the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading; provided, however, that the Company shall not be liable in any such case or to any Indemnified Person to the extent, but only to the extent, that any such Loss arises out of, is based upon or results from an untrue statement or alleged untrue statement or omission or alleged omission or so made in reliance upon or in conformity with information furnished by or on behalf of such Indemnified Person in writing specifically for use in the preparation of the Resale Shelf, the related prospectus, or any amendment or supplement thereto. Such indemnity shall remain in full force and effect regardless of any investigation made by or on behalf of such Indemnified Person, and shall survive the transfer of such securities by the Purchaser or any termination of this Agreement.
|
11. |
The Company’s obligation under paragraph (1) of this Exhibit A is subject to the Purchaser furnishing to the Company in writing such information as the Company reasonably requests for use in connection with the Resale Shelf, the related prospectus, or any amendment or supplement thereto. The Purchaser shall severally, and not jointly with any other selling stockholder named in the Resale Shelf, indemnify
|
the Company, its officers, directors, managers, employees, agents and representatives, and each person who controls the Company (within the meaning of the Securities Act) against any losses, claims, damages, liabilities and expenses resulting from any untrue statement or alleged untrue statement of material fact contained in the Resale Shelf, the related prospectus, or any amendment or supplement thereto or any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, but only to the extent that such untrue statement or omission is contained in any information so furnished in writing by the Purchaser expressly for inclusion in such document; provided that the obligation to indemnify shall be individual, not joint and several, for the Purchaser and shall be limited to the net amount of proceeds received by the Purchaser from the sale of Registrable Securities pursuant to the Resale Shelf. |
12. |
The Company shall cooperate with the Purchaser, to the extent the Registrable Securities become freely tradable, to facilitate the timely preparation and delivery of certificates (not bearing any restrictive legend) representing the Registrable Securities to be offered pursuant to a Resale Shelf and enable such certificates to be in such denominations or amounts, as the case may be, as the Purchaser may reasonably request and registered in such names as the Purchaser may request.
|
13. |
If requested by the Purchaser, the Company shall as soon as practicable, subject to any Suspension Notice, (i) incorporate in a prospectus supplement or post-effective amendment such information as the Purchaser reasonably requests to be included therein relating to the sale and distribution of Registrable Securities, including, without limitation, information with respect to the number of Registrable Securities being offered or sold, the purchase price being paid therefor and any other terms of the offering of the Registrable Securities to be sold in such offering; (ii) make all required filings of such prospectus supplement or post-effective amendment after being notified of the matters to be incorporated in such prospectus supplement or post-effective amendment; and (iii) supplement or make amendments to any Registration Statement if reasonably requested by the Purchaser holding any Registrable Securities.
|
14. |
As long as the Purchaser shall own Registrable Securities, the Company, at all times while it shall be reporting under the Exchange Act shall file timely (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by the Company after the date hereof pursuant to Sections 13(a) or 15(d) of the Exchange Act and shall promptly furnish the Purchaser with true and complete copies of all such filings, unless filed through the SEC’s EDGAR system. The Company further covenants that it shall take such further action as the Purchaser may reasonably request, all to the extent required from time to time, to enable the Purchaser to sell the Class A Shares held by the Purchaser without registration under the Securities Act within the limitation of the exemptions provided by Rule 144 promulgated under the Securities Act, including providing any legal opinions. Upon the request of the Purchaser, the Company shall deliver to the Purchaser a written certification of a duly authorized officer as to whether it has complied with such requirements.
|
15. |
The rights, duties and obligations of the Purchaser under this Exhibit A may be assigned or delegated by the Purchaser in conjunction with and to the extent of any transfer or assignment of Registrable Securities by the Purchaser to any transferee or assignee.
|
16. |
Without limitation of the foregoing, in the event that the Company enters into a registration rights agreement with the Purchaser at or prior to the consummation of the Business Combination, the Purchaser will be entitled to the registration rights agreed to at the time of the Business Combination, which may replace the terms set forth on this Exhibit A.
|
Exhibit
Number |
Description
|
|
2.1†† | Business Combination Agreement, dated as of July 23, 2021, by and among Dragoneer Growth Opportunities Corp. II, Redwood Opportunity Merger Sub, Inc., Redwood Merger Sub LLC and Papay Topco, Inc. (included as Annex A to the proxy statement/prospectus/consent solicitation). | |
3.1 | Amended and Restated Memorandum and Articles of Association of Dragoneer (included as Annex B to the proxy statement/prospectus/consent solicitation). | |
3.2 | Form of Certificate of Incorporation of New Cvent, to become effective upon Domestication (included as Annex C to the proxy statement/prospectus/consent solicitation). | |
3.3 | Form of Bylaws of New Cvent, to become effective upon Domestication (included as Annex D to the proxy statement/prospectus/consent solicitation). | |
4.1 | Specimen Class A Ordinary Share Certificate (incorporated by reference to Exhibit 4.1 to the Registration Statement on Form S-1 filed by the Registrant on November 6, 2020). | |
4.2** | Form of Certificate of Corporate Domestication of Dragoneer, to be filed with the Secretary of the State of Delaware. | |
5.1** | Opinion of Ropes & Gray LLP. | |
10.1 | Form of Subscription Agreement (included as Annex E to the proxy statement/prospectus/consent solicitation). | |
10.2 | Form of Cvent Shareholder Transaction Support Agreement (included as Annex F to the proxy statement/prospectus/consent solicitation). |
Exhibit
Number |
Description
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10.23+** | Form of RSU Award Agreement (Director). | |
10.24+** | Form of RSU Award Agreement (Employee). | |
10.25+** | Form of Option Award Agreement. | |
21.1 | List of subsidiaries of Dragoneer. | |
23.1 | Consent of WithumSmith+Brown, PC, independent registered accounting firm for Dragoneer. | |
23.2 | Consent of PricewaterhouseCoopers LLP, independent registered accounting firm for Cvent. | |
23.3** | Consent of Ropes & Gray LLP (included as part of Exhibit 5.1). | |
23.4 | Consent of Frost & Sullivan. | |
23.5 | Consent of Forrester. | |
24.1 | Power of Attorney. | |
99.1 | Consent of Rajeev Aggarwal to be named as a director | |
99.2 | Consent of Betty Hung to be named as a director | |
99.3 | Consent of Maneet Saroya to be named as a director | |
99.4** | Form of Proxy for Extraordinary General Meeting. | |
99.5** | Form of Written Consent of the Stockholders of Papay Topco, Inc. | |
101.INS | XBRL Instance Document | |
101.SCH | XBRL Taxonomy Extension Schema Document | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document |
** |
To be filed by amendment.
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† |
Certain confidential portions (indicated by brackets and asterisks) have been omitted from this exhibit.
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†† |
Schedules and exhibits to this Exhibit omitted pursuant to Regulation S-K Item 601(b)(2). The Registrant agrees to furnish supplementally a copy of any omitted schedule or exhibit to the SEC upon request.
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+ |
Indicates a management contract or compensatory plan or arrangement.
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§ |
Exhibits and schedules have been omitted pursuant to Item 601(a)(5) of Regulation S-K and will be provided on a supplemental basis to the Securities and Exchange Commission upon request.
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11. |
The undersigned Registrant hereby undertakes:
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(a) |
To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement:
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(i) |
To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;
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(ii) |
To reflect in the prospectus any facts or events arising after the effective date of this Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in this Registration Statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered)
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and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and |
(iii) |
To include any material information with respect to the plan of distribution not previously disclosed in this Registration Statement or any material change to such information in this Registration Statement.
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(b) |
That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
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(c) |
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
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(d) |
That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
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(e) |
That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications,
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(i) |
Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
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(ii) |
Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
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(iii) |
The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
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(iv) |
Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
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12. |
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by them is against public policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue.
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13. |
The undersigned registrant hereby undertakes as follows: that prior to any public reoffering of the securities registered hereunder through use of a prospectus which is a part of this registration statement, by any person or party who is deemed to be an underwriter within the meaning of Rule 145(c), the issuer undertakes that such reoffering prospectus will contain the information called for by the applicable registration form with respect to reofferings by persons who may be deemed underwriters, in addition to the information called for by the other items of the applicable form.
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14. |
The registrant undertakes that every prospectus: (1) that is filed pursuant to the immediately preceding paragraph, or (2) that purports to meet the requirements of Section 10(a)(3) of the Act and is used in connection with an offering of securities subject to Rule 415, will be filed as a part of an amendment to the registration statement and will not be used until such amendment is effective, and that, for purposes of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
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15. |
The undersigned Registrant hereby undertakes to respond to requests for information that is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this Form S-4, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the Registration Statement through the date of responding to the request.
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16. |
The undersigned Registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the Registration Statement when it became effective.
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DRAGONEER GROWTH OPPORTUNITIES CORP. II
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By: |
/s/ Marc Stad
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Name: Marc Stad | ||
Title: Chief Executive Officer and Chairman of the Board of Directors |
NAME
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POSITION
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DATE
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||
/s/ Marc Stad
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Chief Executive Officer and Chairman of the Board of Directors
(
Principal Executive Officer
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September 29, 2021 | ||
Marc Stad
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||||
/s/ Pat Robertson
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President, Chief Operating Officer and Director (
Principal Financial Officer and Principal Accounting Officer
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September 29, 2021 | ||
Pat Robertson
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||||
/s/ Sarah J. Friar
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Director | September 29, 2021 | ||
Sarah J. Friar
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||||
/s/ David D. Ossip
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Director | September 29, 2021 | ||
David D. Ossip
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||||
/s/ Gokul Rajaram
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Director | September 29, 2021 | ||
Gokul Rajaram
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||||
/s/ Jay Simons
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Director | September 29, 2021 | ||
Jay Simons
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Exhibit 10.8
INDEMNIFICATION AGREEMENT
THIS INDEMNIFICATION AGREEMENT (this Agreement) is made and entered into as of [], 2021 between Cvent Holding Corp., a Delaware corporation (the Company), and [ ] (Indemnitee).
WHEREAS, highly competent persons have become more reluctant to serve corporations as directors or officers or in other capacities unless they are provided with adequate protection through insurance or adequate indemnification against inordinate risks of claims and actions against them arising out of their service to and activities on behalf of the corporation;
WHEREAS, the Board of Directors of the Company (the Board) has determined that, in order to attract and retain qualified individuals, the Company will attempt to maintain on an ongoing basis, at its sole expense, liability insurance to protect persons serving the Company and its subsidiaries from certain liabilities. Although the furnishing of such insurance has been a customary and widespread practice among United States-based corporations and other business enterprises, the Company believes that, given current market conditions and trends, such insurance may be available to it in the future only at higher premiums and with more exclusions. At the same time, directors, officers and other persons in service to corporations or business enterprises are being increasingly subjected to expensive and time-consuming litigation relating to, among other things, matters that traditionally would have been brought only against the corporation or business enterprise itself. The Bylaws of the Company (as amended or restated, the Bylaws) require indemnification of the officers and directors of the Company. Indemnitee may also be entitled to indemnification pursuant to the General Corporation Law of the State of Delaware (DGCL). The Bylaws and the DGCL expressly provide that the indemnification provisions set forth therein are not exclusive, and thereby contemplate that contracts may be entered into between the Company and members of the Board, officers of the Company and other persons with respect to indemnification;
WHEREAS, the uncertainties relating to such insurance and to indemnification have increased the difficulty of attracting and retaining such persons;
WHEREAS, the Board has determined that the increased difficulty in attracting and retaining such persons is detrimental to the best interests of the Company and its stockholders and that the Company should act to assure such persons that there will be increased certainty of such protection in the future;
WHEREAS, it is reasonable, prudent and necessary for the Company contractually to obligate itself to indemnify, and to advance expenses on behalf of, such persons to the fullest extent permitted by applicable law so that they will serve or continue to serve the Company free from undue concern that they will not be so indemnified;
WHEREAS, this Agreement is a supplement to and in furtherance of the Bylaws and any resolutions adopted pursuant thereto, and shall not be deemed a substitute therefor, nor to diminish or abrogate any rights of Indemnitee thereunder; [and]
WHEREAS, Indemnitee may not be willing to serve or continue to serve as an officer or director without adequate protection, and the Company desires Indemnitee to serve or continue to serve in such capacity; Indemnitee is willing to serve, continue to serve and take on additional service for or on behalf of the Company on the condition that he be so indemnified[; and]
[WHEREAS, Indemnitee has certain rights to indemnification and/or insurance provided by Vista Equity Partners (Vista) or affiliates of Vista which Indemnitee and Vista intend to be secondary to the primary obligation of the Company to indemnify Indemnitee as provided herein, with the Companys acknowledgment of and agreement to the foregoing being a material condition to Indemnitees willingness to serve on the Board.]1
NOW, THEREFORE, in consideration of Indemnitees agreement to serve as a director or officer from and after the date hereof, the parties hereto agree as follows:
1. Indemnity of Indemnitee. Subject to the provisions of Section 9, the Company hereby agrees to hold harmless and indemnify Indemnitee to the fullest extent permitted by law, as such may be amended from time to time, if Indemnitee was or is, or is threatened to be made, a party to, or otherwise becomes involved in, any Proceeding (as hereinafter defined) by reason of Indemnitees Corporate Status (as hereinafter defined). In furtherance of the foregoing indemnification, and without limiting the generality thereof:
(a) Proceedings other than Proceedings by or in the Right of the Company. Indemnitee shall be entitled to the rights of indemnification provided in this Section l(a) if, by reason of his Corporate Status, Indemnitee is, or is threatened to be made, a party to or participant, or otherwise becomes involved in, in any Proceeding (as hereinafter defined) other than a Proceeding by or in the right of the Company. Pursuant to this Section 1(a), Indemnitee shall be indemnified against all Expenses, judgments, penalties, fines and amounts paid in settlement actually and reasonably incurred by him, or on his behalf, in connection with such Proceeding or any claim, issue or matter therein, if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company, and with respect to any criminal Proceeding, had no reasonable cause to believe Indemnitees conduct was unlawful.
(b) Proceedings by or in the Right of the Company. Indemnitee shall be entitled to the rights of indemnification provided in this Section 1(b) if, by reason of his Corporate Status, Indemnitee is, or is threatened to be made, a party to or participant in any Proceeding brought by or in the right of the Company. Pursuant to this Section 1(b), Indemnitee shall be indemnified against all Expenses actually and reasonably incurred by Indemnitee, or on Indemnitees behalf, in connection with such Proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company; provided, however, if applicable law so provides, no indemnification against such Expenses shall be made in respect of any claim, issue or matter in such Proceeding as to which Indemnitee shall have been finally adjudged by a court to be liable to the Company unless and only to the extent that the court in which the Proceeding was brought shall determine that Indemnitee is fairly and reasonably entitled to indemnification.
1 |
NTD: Bracketed language to be included in form for Vista directors. |
2
(c) Indemnification for Expenses of a Party Who is Wholly or Partly Successful. Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of his Corporate Status, a party to or participant in and is successful, on the merits or otherwise, in any Proceeding or in defense of any claim, issue or matter therein, in whole or in part, he shall be indemnified to the maximum extent permitted by law, as such may be amended from time to time, against all Expenses actually and reasonably incurred by him or on his behalf in connection therewith. If Indemnitee is not wholly successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues or matters in such Proceeding, the Company shall indemnify Indemnitee against all Expenses actually and reasonably incurred by him or on his behalf in connection with each successfully resolved claim, issue or matter. For purposes of this Section 1(c) and without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter.
2. Additional Indemnity. In addition to, and without regard to any limitations on the indemnification provided for in Section 1 of this Agreement, the Company shall and hereby does, to the fullest extent permitted by applicable law, indemnify and hold harmless Indemnitee against all Expenses, judgments, penalties, fines and amounts paid in settlement actually and reasonably incurred by him or on his behalf if, by reason of his Corporate Status, he is, or is threatened to be made, a party to or participant in any Proceeding (including a Proceeding by or in the right of the Company). The only limitation that shall exist upon the Companys obligations pursuant to this Agreement, other than those set forth in Section 9 hereof, shall be that the Company shall not be obligated to make any payment to Indemnitee that is finally determined (under the procedures, and subject to the presumptions, set forth in Sections 6 and 7 hereof) to be unlawful.
3. Contribution.
(a) Whether or not the indemnification provided in Sections 1 and 2 hereof is available, in respect of any threatened, pending or completed action, suit or proceeding in which the Company is jointly liable with Indemnitee (or would be if joined in such action, suit or proceeding), to the fullest extent permitted by applicable law, the Company shall pay, in the first instance, the entire amount of any judgment or settlement of such action, suit or proceeding without requiring Indemnitee to contribute to such payment and the Company hereby waives and relinquishes any right of contribution it may have against Indemnitee. The Company shall not, without the Indemnitees prior written consent, enter into any such settlement of any action, suit or proceeding (in whole or in part) unless such settlement (i) provides for a full and final release of all claims asserted against Indemnitee and (ii) does not impose any Expense, judgment, fine, penalty or limitation on Indemnitee.
(b) Without diminishing or impairing the obligations of the Company set forth in the preceding subparagraph, if, for any reason, Indemnitee shall elect or be required to pay all or any portion of any judgment or settlement in any threatened, pending or completed action, suit or proceeding in which the Company is jointly liable with Indemnitee (or would be if joined in such action, suit or proceeding), to the fullest extent permitted by applicable law, the Company shall contribute to the amount of Expenses, judgments, fines and amounts paid in settlement actually and reasonably incurred and paid or payable by Indemnitee in proportion to the
3
relative benefits received by the Company and all officers, directors or employees of the Company, other than Indemnitee, who are jointly liable with Indemnitee (or would be if joined in such action, suit or proceeding), on the one hand, and Indemnitee, on the other hand, from the transaction from which such action, suit or proceeding arose; provided, however, that the proportion determined on the basis of relative benefit may, to the extent necessary to conform to law, be further adjusted by reference to the relative fault of the Company and all officers, directors or employees of the Company, other than Indemnitee, who are jointly liable with Indemnitee (or would be if joined in such action, suit or proceeding), on the one hand, and Indemnitee, on the other hand, in connection with the events that resulted in such expenses, judgments, fines or settlement amounts, as well as any other equitable considerations which the law may require to be considered. The relative fault of the Company and all officers, directors or employees of the Company, other than Indemnitee, who are jointly liable with Indemnitee (or would be if joined in such action, suit or proceeding), on the one hand, and Indemnitee, on the other hand, shall be determined by reference to, among other things, the degree to which their actions were motivated by intent to gain personal profit or advantage, the degree to which their liability is primary or secondary and the degree to which their conduct is active or passive.
(c) To the fullest extent permitted by applicable law, the Company hereby agrees to fully indemnify and hold Indemnitee harmless from any claims of contribution which may be brought by officers, directors or employees of the Company, other than Indemnitee, who may be jointly liable with Indemnitee.
(d) To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, shall contribute to the amount incurred by Indemnitee, whether for judgments, fines, penalties, excise taxes, amounts paid or to be paid in settlement and/or for Expenses, in connection with any claim relating to an indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits received by the Company and Indemnitee as a result of the event(s) and/or transaction(s) giving cause to such Proceeding, and/or (ii) the relative fault of the Company (and its directors, officers, employees and agents) and Indemnitee in connection with such event(s) and/or transaction(s).
4. Indemnification for Expenses of a Witness. Notwithstanding any other provision of this Agreement, to the fullest extent permitted by applicable law and to the extent that Indemnitee is, by reason of his Corporate Status, a witness, is made (or asked) to respond to discovery requests, or is otherwise asked to participate, in any Proceeding to which Indemnitee is not a party, he shall be indemnified against all Expenses actually and reasonably incurred by him or on his behalf in connection therewith.
5. Advancement of Expenses. Notwithstanding any other provision of this Agreement (other than Section 7(e) and Section 9), the Company shall advance, to the extent not prohibited by law, all Expenses incurred by or on behalf of Indemnitee in connection with any Proceeding (or part of any Proceeding) not initiated by Indemnitee or any Proceeding initiated by Indemnitee with the prior approval of the Board as provided in Section 9(d), within thirty (30) days after the receipt by the Company of a statement or statements from Indemnitee requesting such advance or advances from time to time, whether prior to or after final disposition of such
4
Proceeding. Such statement or statements shall reasonably evidence the Expenses incurred by Indemnitee. Any advances pursuant to this Section 5 shall be unsecured and interest free. In accordance with Sections 7(d) and 7(e) of this Agreement, advances shall include any and all reasonable Expenses incurred pursuing an action to enforce this right of advancement, including Expenses incurred preparing and forwarding statements to the Company to support the advances claimed. This Section 5 shall not apply to claim by Indemnitee for expenses in a matter for which indemnity and advancement of expenses is excluded pursuant to Section 9.
6. Procedures and Presumptions for Determination of Entitlement to Indemnification. It is the intent of this Agreement to secure for Indemnitee rights of indemnity that are as favorable as may be permitted under the DGCL and public policy of the State of Delaware. Accordingly, the parties agree that the following procedures and presumptions shall apply in the event of any question as to whether Indemnitee is entitled to indemnification under this Agreement:
(a) To obtain indemnification under this Agreement, Indemnitee shall submit to the Company a written request, including therein or therewith such documentation and information as is reasonably available to Indemnitee and is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification. The Secretary of the Company shall, promptly upon receipt of such a request for indemnification, advise the Board in writing that Indemnitee has requested indemnification. Notwithstanding the foregoing, any failure of Indemnitee to provide such a request to the Company, or to provide such a request in a timely fashion, shall not relieve the Company of any liability that it may have to Indemnitee unless, and to the extent that, such failure actually and materially prejudices the interests of the Company.
(b) Upon written request by Indemnitee for indemnification pursuant to the first sentence of Section 6(a) hereof, a determination with respect to Indemnitees entitlement thereto shall be made in the specific case by one of the following four methods, which shall be at the election of the Board: (1) by a majority vote of the Disinterested Directors (as hereinafter defined), even though less than a quorum; (2) by a committee of Disinterested Directors designated by a majority vote of the Disinterested Directors, even though less than a quorum; (3) if there are no Disinterested Directors, or if the Disinterested Directors so direct, by Independent Counsel in a written opinion to the Board, a copy of which shall be delivered to Indemnitee; or (4) if so directed by the Board, by the stockholders of the Company; provided, however, that if a Change in Control has occurred, the determination with respect to Indemnitees entitlement to indemnification shall be made by Independent Counsel. For purposes hereof, Disinterested Directors are those members of the Board who are not parties to the action, suit or proceeding in respect of which indemnification is sought by Indemnitee.
(c) In the event the determination of entitlement to indemnification is to be made by Independent Counsel, the Independent Counsel shall be selected as provided in this Section 6(c). If a Change in Control has not occurred, the Independent Counsel shall be selected by the Board, and the Company shall give written notice to the Indemnitee advising him of the identity of the Independent Counsel so selected. Indemnitee may, within 10 days after such written notice of selection shall have been given, deliver to the Company a written objection to such selection; provided, however, that such objection may be asserted only on the ground that the Independent Counsel so selected does not meet the requirements of Independent Counsel as
5
defined in Section 12 of this Agreement, and the objection shall set forth with particularity the factual basis of such assertion. Absent a proper and timely objection, the Person so selected shall act as Independent Counsel. If a written objection is made and substantiated, the Independent Counsel selected may not serve as Independent Counsel unless and until such objection is withdrawn or a court has determined that such objection is without merit. If a Change in Control has occurred, the Independent Counsel shall be selected by the Indemnitee (unless the Indemnitee shall request that such selection be made by the Board, in which event the preceding sentence shall apply), and approved by the Board within 20 days after notification by Indemnitee. If (i) an Independent Counsel is to make the determination of entitlement pursuant to this Section 6, and (ii) within 20 days after submission by Indemnitee of a written request for indemnification pursuant to Section 6(a) hereof, no Independent Counsel shall have been selected (including as a result of an objection to the selected Independent Counsel), either the Company or Indemnitee may petition the Court of Chancery of the State of Delaware or other court of competent jurisdiction for resolution of any objection which shall have been made by Indemnitee to the Companys selection of Independent Counsel and/or for the appointment as Independent Counsel of a Person selected by the court or by such other Person as the court shall designate, and the Person with respect to whom all objections are so resolved or the Person so appointed shall act as Independent Counsel under Section 6(b) hereof. The Company shall pay any and all reasonable fees and expenses of Independent Counsel incurred by such Independent Counsel in connection with acting pursuant to Section 6(b) hereof, and the Company shall pay all reasonable fees and expenses incident to the procedures of this Section 6(c), regardless of the manner in which such Independent Counsel was selected or appointed.
(d) In making a determination with respect to entitlement to indemnification hereunder, the Person making such determination shall to the fullest extent permitted by law presume that Indemnitee is entitled to indemnification under this Agreement. Anyone seeking to overcome this presumption shall have the burden of proof to overcome such presumption. Neither the failure of the Company (including by its directors or independent legal counsel) to have made a determination prior to the commencement of any action pursuant to this Agreement that indemnification is proper in the circumstances because Indemnitee has met the applicable standard of conduct, nor an actual determination by the Company (including by its directors or Independent Counsel) that Indemnitee has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that Indemnitee has not met the applicable standard of conduct.
(e) Indemnitee shall be deemed to have acted in good faith if Indemnitees action is based on the records or books of account of the Enterprise (as hereinafter defined), including financial statements, or on information supplied to Indemnitee by the officers of the Enterprise in the course of their duties, or on the advice of legal counsel for the Enterprise or on information or records given or reports made to the Enterprise by an independent certified public accountant or by an appraiser or other expert selected with reasonable care by the Enterprise. In addition, the knowledge and/or actions, or failure to act, of any director, officer, agent or employee of the Enterprise shall not be imputed to Indemnitee for purposes of determining the right to indemnification under this Agreement. Whether or not the foregoing provisions of this Section 6(e) are satisfied, it shall in any event be presumed that Indemnitee has at all times acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Company. Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion by clear and convincing evidence.
6
(f) If the Person empowered or selected under this Section 6 to determine whether Indemnitee is entitled to indemnification shall not have made a determination within sixty (60) days after receipt by the Company of the request therefor, the requisite determination of entitlement to indemnification shall to the fullest extent permitted by law be deemed to have been made and Indemnitee shall be entitled to such indemnification absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitees statement not materially misleading, in connection with the request for indemnification, or (ii) a prohibition of such indemnification under applicable law; provided, however, that such 60-day period may be extended for a reasonable time, not to exceed an additional thirty (30) days, if the Person making such determination with respect to entitlement to indemnification in good faith requires such additional time to obtain or evaluate documentation and/or information relating thereto; and provided, further, that the foregoing provisions of this Section 6(f) shall not apply if the determination of entitlement to indemnification is to be made by the stockholders pursuant to Section 6(b) of this Agreement and if (A) within fifteen (15) days after receipt by the Company of the request for such determination, the Board or the Disinterested Directors, if appropriate, resolve to submit such determination to the stockholders for their consideration at an annual meeting thereof to be held within seventy-five (75) days after such receipt and such determination is made thereat, or (B) a special meeting of stockholders is called within fifteen (15) days after such receipt for the purpose of making such determination, such meeting is held for such purpose within sixty (60) days after having been so called and such determination is made thereat.
(g) Indemnitee shall cooperate with the Person making such determination with respect to Indemnitees entitlement to indemnification, including providing to such Person upon reasonable advance request any documentation or information which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee and reasonably necessary to such determination. Any costs or expenses (including reasonable attorneys fees and disbursements) incurred by Indemnitee in so cooperating with the Person making such determination shall be borne by the Company (irrespective of the determination as to Indemnitees entitlement to indemnification) and the Company hereby indemnifies and agrees to hold Indemnitee harmless therefrom.
(h) The Company acknowledges that a settlement or other disposition short of final judgment may be successful if it permits a party to avoid expense, delay, distraction, disruption and uncertainty. In the event that any action, claim or proceeding to which Indemnitee is a party is resolved in any manner other than by adverse judgment against Indemnitee (including, without limitation, settlement of such action, claim or proceeding with or without payment of money or other consideration) it shall to the fullest extent permitted by law be presumed that Indemnitee has been successful on the merits or otherwise in such action, suit or proceeding. Anyone seeking to overcome this presumption shall have the burden of proof and the burden of persuasion by clear and convincing evidence.
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(i) The termination of any Proceeding or of any claim, issue or matter therein, by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not (except as otherwise expressly provided in this Agreement) of itself adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the Company or, with respect to any criminal Proceeding, that Indemnitee had reasonable cause to believe that his conduct was unlawful.
7. Remedies of Indemnitee.
(a) In the event that (i) a determination is made pursuant to Section 6 of this Agreement that Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 5 of this Agreement, (iii) no determination of entitlement to indemnification is made pursuant to Section 6(b) of this Agreement within ninety (90) days after receipt by the Company of the request for indemnification or (iv) payment of indemnification is not made within ten (10) days after a determination has been made that Indemnitee is entitled to indemnification or such determination is deemed to have been made pursuant to Section 6 of this Agreement, Indemnitee shall be entitled to an adjudication in an appropriate court of the State of Delaware, or in any other court of competent jurisdiction, of Indemnitees entitlement to such indemnification, contribution or advancement of Expenses. Alternatively, Indemnitee, at his option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association. The Company shall not oppose Indemnitees right to seek any such adjudication or award in arbitration.
(b) In the event that a determination shall have been made pursuant to Section 6(b) of this Agreement that Indemnitee is not entitled to indemnification, any judicial proceeding or arbitration commenced pursuant to this Section 7 shall be conducted in all respects as a de novo trial, or arbitration, on the merits, and Indemnitee shall not be prejudiced by reason of the adverse determination under Section 6(b). In any judicial proceeding or arbitration commenced pursuant to this Section 7, Indemnitee shall be presumed to be entitled to indemnification under this Agreement and the Company shall have the burden of proving Indemnitee is not entitled to indemnification or advancement of Expenses, as the case may be, and the Company may not refer to or introduce into evidence any determination pursuant to Section 6(b) of this Agreement adverse to Indemnitee for any purpose other than to establish its compliance with the terms of this Agreement. If Indemnitee commences a judicial proceeding or arbitration pursuant to this Section 7, Indemnitee shall not be required to reimburse the Company for any advances pursuant to Section 5 until a final determination is made with respect to Indemnitees entitlement to indemnification (as to which all rights of appeal have been exhausted or lapsed).
(c) If a determination shall have been made pursuant to Section 6(b) of this Agreement that Indemnitee is entitled to indemnification, the Company shall be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this Section 7, absent (i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary to make Indemnitees misstatement not materially misleading, in connection with the application for indemnification, or (ii) a prohibition of such indemnification under applicable law.
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(d) In the event that Indemnitee, pursuant to this Section 7, incurs costs, in a judicial or arbitration proceeding or otherwise, attempting to enforce his rights under, or to recover damages for breach of, this Agreement, or to recover under any directors and officers liability insurance policies maintained by the Company, the Company shall pay on his behalf, in advance, any and all expenses (of the types described in the definition of Expenses in Section 12 of this Agreement) actually and reasonably incurred by him in such efforts, regardless of whether Indemnitee ultimately is determined to be entitled to such indemnification, advancement of expenses or insurance recovery, to the fullest extent permitted by applicable law. It is the intent of the Company that, to the fullest extent permitted by applicable law, Indemnitee not be required to incur legal fees or other Expenses associated with the interpretation, enforcement or defense of Indemnitees rights under this Agreement by litigation or otherwise because the cost and expense thereof would substantially detract from the benefits intended to be extended to Indemnitee hereunder.
(e) The Company shall, to the fullest extent not prohibited by law, be precluded from asserting in any judicial proceeding or arbitration commenced pursuant to this Section 7 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court or before any such arbitrator that the Company is bound by all the provisions of this Agreement.
(f) Notwithstanding anything in this Agreement to the contrary, no determination as to entitlement to indemnification under this Agreement shall be required to be made prior to the final disposition of the Proceeding.
8. Non-Exclusivity; Survival of Rights; [Primacy of Indemnification;] Insurance; Subrogation.
(a) The rights of indemnification and to receive advancement of Expenses as provided by this Agreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the Certificate of Incorporation of the Company (as amended or restated, the Charter), the Bylaws, any agreement, a vote of stockholders, a resolution of directors or otherwise, of the Company. No amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee in his Corporate Status prior to such amendment, alteration or repeal. To the extent that a change in the DGCL, whether by statute or judicial decision, permits greater indemnification than would be afforded currently under the Charter, Bylaws and this Agreement, it is the intent of the parties hereto that Indemnitee shall enjoy by this Agreement the greater benefits so afforded by such change. No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy shall be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other right or remedy.
(b) The Company shall, if commercially reasonable, obtain and maintain in effect during the entire period for which the Company is obligated to indemnify Indemnitee under this Agreement, one or more policies of insurance with reputable insurance companies to provide the directors and officers of the Company with coverage for losses from wrongful acts and omissions and to ensure the Companys performance of its indemnification
9
obligations under this Agreement. Indemnitee shall be covered by such policy or policies in accordance with its or their terms to the maximum extent of the coverage available for any such officer or director under such policy or policies. In all such insurance policies, Indemnitee shall be named as an insured in such a manner as to provide Indemnitee with the same rights and benefits as are accorded to the most favorably insured of the Companys directors and officers. At the time of the receipt of a notice of a claim pursuant to the terms hereof, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies.
(c) [The Company hereby acknowledges that Indemnitee has certain rights to indemnification, advancement of expenses and/or insurance provided by Vista and certain affiliates that, directly or indirectly, (i) are controlled by, (ii) control or (iii) are under common control with, Vista (collectively, the Fund Indemnitor). With respect to any amounts that are subject to indemnity under this Agreement and also subject to an indemnity obligation owed by Fund Indemnitor, the Company hereby agrees (i) that, as compared the Fund Indemnitor, it is the indemnitor of first resort with respect to any rights to indemnification provided to Indemnitee herein (i.e., its obligations to Indemnitee are primary and any obligation of the Fund Indemnitor to advance expenses or to provide indemnification for the same expenses or liabilities incurred by Indemnitee is secondary), (ii) that it shall be required to advance the full amount of expenses incurred by Indemnitee and shall be liable for the full amount of all Expenses, judgments, penalties, fines and amounts paid in settlement to the extent legally permitted and as required by the terms of this Agreement and the Charter or Bylaws of the Company (or any other agreement between the Company and Indemnitee), without regard to any rights Indemnitee may have against the Fund Indemnitor, and (iii) that it irrevocably waives, relinquishes and releases the Fund Indemnitor from any and all claims against the Fund Indemnitor for contribution, subrogation or any other recovery of any kind in respect thereof. The Company further agrees that no advancement or payment by the Fund Indemnitor on behalf of Indemnitee with respect to any claim for which Indemnitee has sought indemnification from the Company shall affect the foregoing and the Fund Indemnitor shall have a right of contribution and/or be subrogated to the extent of such advancement or payment to all of the rights of recovery of Indemnitee against the Company. The Company and Indemnitee agree that the Fund Indemnitor are express third party beneficiaries of the terms of this Section 8(c).]
(d) [Except as provided in Section 8(c) above,] in the event of any payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee [(other than against the Fund Indemnitor)], who shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights.
(e) [Except as provided in Section 8(c) above,] the Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable (or for which advancement of Expenses is provided) hereunder if and to the extent that Indemnitee has otherwise actually received such payment under any insurance policy, contract, agreement or otherwise.
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(f) [Except as provided in Section 8(c) above,] the Companys obligation to indemnify or advance Expenses hereunder to Indemnitee who is or was serving at the request of the Company as a director, officer, employee or agent of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise shall be reduced by any amount Indemnitee has actually received as indemnification or advancement of expenses from such other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise.
9. Exception to Right of Indemnification. Notwithstanding any provision in this Agreement, the Company shall not be obligated under this Agreement to make any indemnity or advancement of expenses in connection with any claim made against Indemnitee:
(a) for which payment has actually been made to or on behalf of Indemnitee under any insurance policy or other indemnity provision, except with respect to any excess beyond the amount paid under any insurance policy or other indemnity provision; [provided, that the foregoing shall not affect the rights of Indemnitee or the Fund Indemnitor set forth in Section 8(c) above;] or
(b) for an accounting of profits made from the purchase and sale (or sale and purchase) by Indemnitee of securities of the Company within the meaning of Section 16(b) of the Exchange Act (as hereinafter defined), or similar provisions of state statutory law or common law; or
(c) for reimbursement to the Company of any bonus or other incentive-based or equity-based compensation or of any profits realized by Indemnitee from the sale of securities of the Company in each case as required under the Exchange Act (including any such reimbursements that arise from an accounting restatement of the Company pursuant to Section 304 of the Sarbanes-Oxley Act of 2002 (the Sarbanes-Oxley Act) or Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act in connection with an accounting restatement of the Company or the payment to the Company of profits arising from the purchase and sale by Indemnitee of securities in violation of Section 306 of the Sarbanes-Oxley Act);
(d) in connection with any Proceeding (or any part of any Proceeding) initiated by Indemnitee, including any Proceeding (or any part of any Proceeding) initiated by Indemnitee against the Company or its directors, officers, employees or other indemnitees, unless (i) the Company has joined in or the Board authorized the Proceeding (or any part of any Proceeding) prior to its initiation, (ii) the Company provides the indemnification, in its sole discretion, pursuant to the powers vested in the Company under applicable law, or (iii) the Proceeding is one to enforce Indemnitees rights under this Agreement or;
(e) any reimbursement of the Company by Indemnitee of any compensation pursuant to any compensation recoupment or clawback policy adopted by the Board or the compensation committee of the Board, including but not limited to any such policy adopted to comply with stock exchange listing requirements implementing Section 10D of the Exchange Act.
10. Non-Disclosure of Payments. Except as expressly required by the securities laws of the United States of America, neither party shall disclose any payments under this Agreement unless prior approval of the other party is obtained. If any payment information must be disclosed, the Company shall afford the Indemnitee an opportunity to review all such disclosures and, if requested, to explain in such statement any mitigating circumstances regarding the events to be reported.
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11. Duration of Agreement. All agreements and obligations of the Company contained herein shall continue until and terminate upon the later of (i) twenty (20) years after the date that Indemnitee shall have ceased to serve as a director or officer of the Company or a director, officer, trustee, partner, managing member, fiduciary, employee or agent of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise which Indemnitee served at the request of the Company, and (ii) one (1) year after the final termination of any Proceeding (including any rights of appeal thereto) in respect of which Indemnitee is granted rights of indemnification or advancement of Expenses hereunder and of any Proceeding commenced by Indemnitee pursuant to Section 7 of this Agreement relating thereto (including any rights of appeal of any Section 7 Proceeding). Termination of this Agreement shall not adversely affect any right or protection hereunder of any Indemnitee in respect of any Proceeding (regardless of when such Proceeding is first threatened, commenced or completed) arising out of, or related to, any act or omission occurring prior to the time of such termination. This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business or assets of the Company), assigns, spouses, heirs, executors and personal and legal representatives.
12. Definitions. For purposes of this Agreement:
(a) Beneficial Owner shall have the meaning given to such term in Rule 13d-3 under the Exchange Act; provided, however, that Beneficial Owner shall exclude any Person otherwise becoming a Beneficial Owner by reason of the stockholders of the Company approving a merger of the Company with another entity.
(b) Change in Control shall be deemed to occur upon the earliest to occur after the date of this Agreement of any of the following events:
(i) Acquisition of Stock by Third Party. Any Person (as defined below), other than Vista and its respective affiliates and other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company or a corporation owned directly or indirectly by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company, is or becomes the Beneficial Owner (as defined above), directly or indirectly, of securities of the Company representing more than 50% of the combined voting power of the Companys then outstanding securities, unless the change in relative Beneficial Ownership of the Companys securities by any Person results solely from a reduction in the aggregate number of outstanding securities entitled to vote generally in the election of directors;
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(ii) Change in Board of Directors. During any period of two (2) consecutive years (not including any period prior to the execution of this Agreement), individuals who at the beginning of such period constitute the Board, and any new director (other than a director designated by a Person who has entered into an agreement with the Company to effect a transaction described in Section 12(b)(i), 12(b)(iii) or 12(b)(iv)) whose election by the Board or nomination for election by the Companys stockholders was approved by a vote of at least two-thirds of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute at least a majority of the members of the Board;
(iii) Corporate Transactions. The effective date of a merger or consolidation of the Company with any other entity, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than 50% of the combined voting power of the voting securities of the surviving entity outstanding immediately after such merger or consolidation and with the power to elect at least a majority of the Board or other governing body of such surviving entity; and
(iv) Liquidation. The approval by the stockholders of the Company of a complete liquidation of the Company or an agreement or series of agreements for the sale or disposition by the Company of all or substantially all of the Companys assets, or, if such approval is not required, the decision by the Board to proceed with such a liquidation, sale, or disposition in one transaction or a series of related transactions.
(c) Corporate Status describes the status of a person who is or was a director, officer, employee, agent or fiduciary of the Company, any direct or indirect subsidiary of the Company, or of any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise that such person is or was serving at the express written request of the Company.
(d) Disinterested Director means a director of the Company who is not and was not a party to the Proceeding in respect of which indemnification is sought by Indemnitee.
(e) Enterprise shall mean the Company and any other corporation, partnership, joint venture, trust, employee benefit plan or other enterprise that Indemnitee is or was serving at the request of the Company as a director, officer, trustee, partner, managing member, employee, agent or fiduciary.
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(f) Exchange Act shall mean the Securities Exchange Act of 1934, as amended.
(g) Expenses shall include all reasonable attorneys fees, retainers, court costs, transcript costs, fees of experts and other professionals, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, ERISA excise taxes and penalties, and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, participating, or being or preparing to be a witness in a Proceeding, or responding to, or objecting to, a request to provide discovery in any Proceeding. Expenses also shall include Expenses incurred in connection with any appeal resulting from any Proceeding and any federal, state, local or foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt of any payments under this Agreement, including without limitation the premium, security for, and other costs relating to any cost bond, supersedeas bond, or other appeal bond or its equivalent. Expenses, however, shall not include amounts paid in settlement by Indemnitee or the amount of judgments or fines against Indemnitee.
(h) Independent Counsel means a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither presently is, nor in the past five (5) years has been, retained to represent: (i) the Company or Indemnitee in any matter material to either such party (other than with respect to matters concerning Indemnitee under this Agreement, or of other indemnitees under similar indemnification agreements), or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term Independent Counsel shall not include any Person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitees rights under this Agreement. The Company agrees to pay the reasonable fees and disbursements of the Independent Counsel referred to above and to fully indemnify such counsel against any and all Expenses, claims, liabilities and damages arising out of or relating to this Agreement or its engagement pursuant hereto.
(i) Person shall have the meaning as set forth in Sections 13(d) and 14(d) of the Exchange Act; provided, however, that Person shall exclude (i) the Company, (ii) any trustee or other fiduciary holding securities under an employee benefit plan of the Company, and (iii) any corporation owned, directly or indirectly, by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company.
(j) Proceeding includes any threatened, pending or completed action, suit, claim, counterclaim, cross claim, arbitration, mediation, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other actual, threatened or completed proceeding, whether brought by or in the right of the Company or otherwise and whether civil, criminal, administrative or investigative, in which Indemnitee was, is or will be involved as a party or otherwise, by reason of the fact that Indemnitee is or was an officer or director of the Company, by reason of any action taken by him or of any inaction on his part while acting as an officer or director of the Company, or by reason of the fact that he is or was serving at the request of the Company as a director, officer, employee, agent or fiduciary of another corporation, partnership, joint venture, trust or other enterprise; in each case whether or not he is acting or serving in any such capacity at the time any liability or expense is incurred for which indemnification can be provided under this Agreement; including one pending on or before the date of this Agreement, but excluding one initiated by an Indemnitee pursuant to Section 7 of this Agreement to enforce his rights under this Agreement.
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13. Severability. If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever: (i) the validity, legality, and enforceability of the remaining provisions of this Agreement (including, without limitation, each portion of any Section, paragraph or sentence of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law; (ii) such provision or provisions shall be deemed reformed to the fullest extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto; and (iii) to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of any Section, paragraph or sentence of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby. Without limiting the generality of the foregoing, this Agreement is intended to confer upon Indemnitee indemnification rights to the fullest extent permitted by applicable laws.
14. Enforcement and Binding Effect.
(a) The Company expressly confirms and agrees that it has entered into this Agreement and assumed the obligations imposed on it hereby in order to induce Indemnitee to serve as a director or officer of the Company, and the Company acknowledges that Indemnitee is relying upon this Agreement in serving or continuing to serve as a director or officer of the Company.
(b) Without limiting any of the rights of Indemnitee under the Charter or Bylaws of the Company as they may be amended from time to time, this Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties hereto with respect to the subject matter hereof.
(c) The indemnification and advancement of expenses provided by, or granted pursuant to, this Agreement shall be binding upon and be enforceable by the parties hereto and their respective successors and assigns (including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business or assets of the Company), shall continue as to an Indemnitee who has ceased to be a director, officer, employee or agent of the Company or of any other Enterprise at the Companys request, and shall inure to the benefit of Indemnitee and his spouse, assigns, heirs, devisees, executors and administrators and other legal representatives.
(d) The Company shall require and cause any successor (whether direct or indirect by purchase, merger, consolidation or otherwise) to all or substantially all of the business and/or assets of the Company to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.
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(e) The Company and Indemnitee agree herein that a monetary remedy for breach of this Agreement, at some later date, may be inadequate, impracticable and difficult of proof, and further agree that such breach may cause Indemnitee irreparable harm. Accordingly, the parties hereto agree that Indemnitee may enforce this Agreement by seeking injunctive relief and/or specific performance hereof, without any necessity of showing actual damage or irreparable harm and that by seeking injunctive relief and/or specific performance, Indemnitee shall not be precluded from seeking or obtaining any other relief to which he may be entitled. The Company and Indemnitee further agree that Indemnitee shall be entitled to such specific performance and injunctive relief, including temporary restraining orders, preliminary injunctions and permanent injunctions, without the necessity of posting bonds or other undertaking in connection therewith. The Company acknowledges that in the absence of a waiver, a bond or undertaking may be required of Indemnitee by the court, and the Company hereby waives any such requirement of such a bond or undertaking.
15. Modification and Waiver. No supplement, modification, termination or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.
16. Notice By Indemnitee. Indemnitee agrees promptly to notify the Company in writing upon being served with or otherwise receiving any summons, citation, subpoena, complaint, indictment, information or other document relating to any Proceeding or matter which may be subject to indemnification or advancement of Expenses covered hereunder. The failure to so notify the Company shall not relieve the Company of any obligation which it may have to Indemnitee under this Agreement or otherwise unless and only to the extent that such failure or delay materially prejudices the Company.
17. Notices. All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed effectively given: (i) upon personal delivery to the party to be notified, (ii) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient, and if not so confirmed, then on the next business day, (iii) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (iv) one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt. All communications shall be sent:
(a) To Indemnitee at the address set forth below Indemnitees signature hereto.
(b) To the Company at:
Cvent Holding Corp.
1765 Greensboro Station Place, 7th Floor
Tysons, VA 22102
Attention: General Counsel
E-mail: [***]
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or to such other address as may have been furnished to Indemnitee by the Company or to the Company by Indemnitee, as the case may be.
18. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same Agreement. This Agreement may also be executed and delivered by facsimile signature and in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
19. Headings. The headings of the paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction thereof.
20. Usage of Pronouns. Use of the masculine pronoun shall be deemed to include usage of the feminine pronoun where appropriate.
21. Governing Law and Consent to Jurisdiction. This Agreement and the legal relations among the parties shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without regard to its conflict-of-laws rules. Except with respect to any arbitration commenced by Indemnitee pursuant to Section 7 of this Agreement, the Company and Indemnitee hereby irrevocably and unconditionally (i) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the Chancery Court of the State of Delaware (the Delaware Court), and not in any other state or federal court in the United States of America or any court in any other country, (ii) consent to submit to the exclusive jurisdiction of the Delaware Court for purposes of any action or proceeding arising out of or in connection with this Agreement.
[The Remainder of This Page Is Intentionally Left Blank.]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and as of the day and year first written above.
CVENT HOLDING CORP. |
By: |
Name: |
Title: |
INDEMNITEE |
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Name: |
Address: |
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[Signature Page to Indemnification Agreement]
Exhibit 10.10
EXECUTION VERSION
AMENDED AND RESTATED CREDIT AGREEMENT
dated as of November 30, 2017,
among
CVENT, INC.,
as Borrower,
PAP AY HOLDCO, LLC,
as Holdings,
THE OTHER GUARANTORS FROM TIME TO TIME PARTY HERETO,
THE LENDERS FROM TIME TO TIME PARTY HERETO,
GOLDMAN SACHS BANK USA,
as Administrative Agent and Collateral Agent
and as a Joint Lead Arranger and Joint Bookrunner,
and
ANTARES CAPITAL LP,
JEFFERIES FINANCE LLC,
And
RBC CAPITAL MARKETS1
as Joint Lead Arrangers and Joint Bookrunners
1 |
RBC Capital Markets is brand name for the capital markets businesses of Royal Bank of Canada and its affiliates. |
TABLE OF CONTENTS
Page | ||||||
ARTICLE I |
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DEFINITIONS |
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Section 1.01 |
Defined Terms | 2 | ||||
Section 1.02 |
Classification of Loans and Borrowings | 74 | ||||
Section 1.03 |
Terms Generally | 74 | ||||
Section 1.04 |
Accounting Terms; GAAP; Tax Laws | 75 | ||||
Section 1.05 |
Resolution of Drafting Ambiguities | 77 | ||||
Section 1.06 |
Limited Condition Transaction | 77 | ||||
Section 1.07 |
Times of Day | 78 | ||||
Section 1.08 |
Deliveries | 79 | ||||
Section 1.09 |
Schedules and Exhibits | 79 | ||||
Section 1.10 |
Currency Generally | 79 | ||||
Section 1.11 |
Basket Amounts and Application of Multiple Relevant Provisions | 79 | ||||
Section 1.12 |
Letter of Credit Amounts | 80 | ||||
ARTICLE II |
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THE CREDITS |
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Section 2.01 |
Commitments | 81 | ||||
Section 2.02 |
Loans | 81 | ||||
Section 2.03 |
Borrowing Procedure | 83 | ||||
Section 2.04 |
Evidence of Debt; Repayment of Loans | 83 | ||||
Section 2.05 |
Fees | 84 | ||||
Section 2.06 |
Interest on Loans | 86 | ||||
Section 2.07 |
Termination and Reduction of Commitments | 86 | ||||
Section 2.08 |
Interest Elections | 87 | ||||
Section 2.09 |
Amortization of Term Loan Borrowings | 88 | ||||
Section 2.10 |
Optional and Mandatory Prepayments of Loans | 89 | ||||
Section 2.11 |
Alternate Rate of Interest | 95 | ||||
Section 2.12 |
Yield Protection | 96 | ||||
Section 2.13 |
Funding Losses | 98 | ||||
Section 2.14 |
Payments Generally; Pro Rata Treatment; Sharing of Setoffs | 98 | ||||
Section 2.15 |
Taxes | 100 | ||||
Section 2.16 |
Mitigation Obligations; Replacement of Lenders | 104 | ||||
Section 2.17 |
Swing Line Loans | 106 | ||||
Section 2.18 |
Letters of Credit | 108 | ||||
Section 2.19 |
Defaulting Lenders | 118 | ||||
Section 2.20 |
Increase in Commitments | 121 | ||||
Section 2.21 |
Extension Amendments | 125 | ||||
Section 2.22 |
Refinancing Facilities | 128 | ||||
Section 2.23 |
Permitted Debt Exchanges | 129 | ||||
Section 2.24 |
Designation of Borrowers | 132 | ||||
Section 2.25 |
AHYDO Prepayment | 133 | ||||
Section 2.26 |
Illegality | 134 |
i
ARTICLE III |
|
|||||
REPRESENTATIONS AND WARRANTIES |
|
|||||
Section 3.01 |
Organization; Powers | 135 | ||||
Section 3.02 |
Authorization; Enforceability | 135 | ||||
Section 3.03 |
No Conflicts | 135 | ||||
Section 3.04 |
Financial Statements; Projections | 135 | ||||
Section 3.05 |
Properties | 136 | ||||
Section 3.06 |
Intellectual Property | 136 | ||||
Section 3.07 |
Equity Interests and Restricted Subsidiaries | 136 | ||||
Section 3.08 |
Litigation | 137 | ||||
Section 3.09 |
Federal Reserve Regulations | 137 | ||||
Section 3.10 |
Investment Company Act | 137 | ||||
Section 3.11 |
Use of Proceeds | 137 | ||||
Section 3.12 |
Taxes | 137 | ||||
Section 3.13 |
No Material Misstatements | 138 | ||||
Section 3.14 |
Labor Matters | 138 | ||||
Section 3.15 |
Solvency | 138 | ||||
Section 3.16 |
Employee Benefit Plans | 139 | ||||
Section 3.17 |
Environmental Matters | 139 | ||||
Section 3.18 |
Security Documents | 140 | ||||
Section 3.19 |
Anti-Terrorism Law | 140 | ||||
Section 3.20 |
OFAC | 141 | ||||
Section 3.21 |
Foreign Corrupt Practices Act | 141 | ||||
Section 3.22 |
Compliance with Law | 141 | ||||
ARTICLE IV |
|
|||||
CONDITIONS |
|
|||||
Section 4.01 |
Conditions to Initial Credit Extension | 141 | ||||
Section 4.02 |
Conditions to All Credit Extensions | 144 | ||||
ARTICLE V |
|
|||||
AFFIRMATIVE COVENANTS |
|
|||||
Section 5.01 |
Financial Statements, Reports, etc. | 145 | ||||
Section 5.02 |
Litigation and Other Notices | 147 | ||||
Section 5.03 |
Existence; Properties | 147 | ||||
Section 5.04 |
Insurance | 148 | ||||
Section 5.05 |
Taxes | 148 | ||||
Section 5.06 |
Employee Benefits | 148 | ||||
Section 5.07 |
Maintaining Records; Access to Properties and Inspections | 149 | ||||
Section 5.08 |
Use of Proceeds | 149 | ||||
Section 5.09 |
Compliance with Environmental Laws; Environmental Reports | 150 |
ii
Section 5.10 |
Additional Collateral; Additional Guarantors | 150 | ||||
Section 5.11 |
Security Interests; Further Assurances | 152 | ||||
Section 5.12 |
Maintenance of Ratings | 152 | ||||
Section 5.13 |
Compliance with Law | 152 | ||||
Section 5.14 |
Anti-Terrorism Law; Anti-Money Laundering; Foreign Corrupt Practices Act | 153 | ||||
Section 5.15 |
Post-Closing Deliveries | 153 | ||||
ARTICLE VI |
|
|||||
NEGATIVE COVENANTS |
|
|||||
Section 6.01 |
Indebtedness | 154 | ||||
Section 6.02 |
Liens | 158 | ||||
Section 6.03 |
Investments, Loans and Advances | 162 | ||||
Section 6.04 |
Mergers and Consolidations | 167 | ||||
Section 6.05 |
Asset Sales | 168 | ||||
Section 6.06 |
Dividends | 170 | ||||
Section 6.07 |
Transactions with Affiliates | 174 | ||||
Section 6.08 |
First Lien Leverage Ratio | 175 | ||||
Section 6.09 |
Prepayments of Certain Indebtedness; Modifications of Organizational Documents and Other Documents, etc. | 176 | ||||
Section 6.10 |
Holding Company Status | 177 | ||||
Section 6.11 |
No Further Negative Pledge; Subsidiary Distributions | 178 | ||||
Section 6.12 |
Nature of Business | 179 | ||||
Section 6.13 |
Fiscal Year | 179 | ||||
ARTICLE VII |
|
|||||
GUARANTEE |
|
|||||
Section 7.01 |
The Guarantee | 179 | ||||
Section 7.02 |
Obligations Unconditional | 180 | ||||
Section 7.03 |
Reinstatement | 182 | ||||
Section 7.04 |
Subrogation; Subordination | 182 | ||||
Section 7.05 |
Remedies | 183 | ||||
Section 7.06 |
Instrument for the Payment of Money | 183 | ||||
Section 7.07 |
Continuing Guarantee | 183 | ||||
Section 7.08 |
General Limitation on Guarantee Obligations | 183 | ||||
Section 7.09 |
Release of Guarantors | 183 | ||||
Section 7.10 |
Right of Contribution | 184 | ||||
ARTICLE VIII |
|
|||||
EVENTS OF DEFAULT |
|
|||||
Section 8.01 |
Events of Default | 184 | ||||
Section 8.02 |
Application of Proceeds | 188 | ||||
Section 8.03 |
Equity Cure | 189 |
iii
ARTICLE IX |
|
|||||
THE ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT |
|
|||||
Section 9.01 |
Appointment and Authority | 191 | ||||
Section 9.02 |
Rights as a Lender | 192 | ||||
Section 9.03 |
Exculpatory Provisions | 192 | ||||
Section 9.04 |
Reliance by Administrative Agent | 193 | ||||
Section 9.05 |
Delegation of Duties | 194 | ||||
Section 9.06 |
Resignation of Administrative Agent | 194 | ||||
Section 9.07 |
Non-Reliance on Administrative Agent and Other Lenders | 196 | ||||
Section 9.08 |
No Other Duties, Etc. | 196 | ||||
Section 9.09 |
Administrative Agent May File Proofs of Claim; Credit Bidding | 196 | ||||
Section 9.10 |
Collateral and Guarantee Matters | 198 | ||||
Section 9.11 |
Secured Cash Management Agreements and Secured Hedging Agreements | 199 | ||||
Section 9.12 |
Withholding Tax | 200 | ||||
Section 9.13 |
Certain ERISA Matters | 200 | ||||
ARTICLE X |
|
|||||
MISCELLANEOUS |
|
|||||
Section 10.01 |
Notices | 202 | ||||
Section 10.02 |
Waivers; Amendment | 206 | ||||
Section 10.03 |
Expenses; Indemnity; Damage Waiver | 212 | ||||
Section 10.04 |
Successors and Assigns | 215 | ||||
Section 10.05 |
Survival of Agreement | 224 | ||||
Section 10.06 |
Counterparts; Integration; Effectiveness | 224 | ||||
Section 10.07 |
Severability | 225 | ||||
Section 10.08 |
Right of Setoff | 225 | ||||
Section 10.09 |
Governing Law; Jurisdiction; Consent to Service of Process | 226 | ||||
Section 10.10 |
Waiver of Jury Trial | 226 | ||||
Section 10.11 |
Headings | 227 | ||||
Section 10.12 |
Treatment of Certain Information; Confidentiality | 227 | ||||
Section 10.13 |
USA PATRIOT Act Notice | 228 | ||||
Section 10.14 |
Interest Rate Limitation | 228 | ||||
Section 10.15 |
Obligations Absolute | 228 | ||||
Section 10.16 |
No Advisory or Fiduciary Responsibility | 229 | ||||
Section 10.17 |
Intercreditor Agreement | 230 | ||||
Section 10.18 |
Acknowledgement and Consent to Bail-In of EEA Financial Institutions | 230 | ||||
Section 10.19 |
Electronic Execution of Assignments and Certain Other Documents | 230 |
iv
ANNEXES
Annex A | Commitments | |
SCHEDULES | ||
Schedule 3.03 | Governmental Approvals; Compliance with Laws | |
Schedule 3.07 | Subsidiaries | |
Schedule 3.08 | Litigation | |
Schedule 5.15 | Post-Closing Deliveries | |
Schedule 6.01(b) | Existing Indebtedness | |
Schedule 6.02(c) | Existing Liens | |
Schedule 6.03(b) | Existing Investments | |
Schedule 6.07 | Transactions with Affiliates | |
Schedule 6.11 | Burdensome Agreements | |
EXHIBITS | ||
Exhibit A | Form of Administrative Questionnaire | |
Exhibit B | Form of Assignment and Assumption | |
Exhibit C-l | Form of Borrowing Request | |
Exhibit C-2 | Form of Prepayment Notice | |
Exhibit D | Form of Compliance Certificate | |
Exhibit E | Form of Interest Election Request | |
Exhibit F | Form of Joinder Agreement | |
Exhibit G | Form of LC Request | |
Exhibit H-l | Form of Term Loan Note | |
Exhibit H-2 | Form of Revolving Note | |
Exhibit H-3 | Form of Swing Line Note | |
Exhibit I | Form of First Lien/Second Lien Intercreditor Agreement | |
Exhibit J | Reserved | |
Exhibit K | Form of Non-Bank Certificate | |
Exhibit L | Form of Solvency Certificate | |
Exhibit M | Pari Passu Intercreditor Term Sheet |
v
EXECUTION VERSION
AMENDED AND RESTATED CREDIT AGREEMENT
This AMENDED AND RESTATED CREDIT AGREEMENT (this Agreement), dated as of November 30, 2017, is made among Cvent, Inc., a Delaware corporation (Cvent and the Borrower), Papay Holdco, LLC, a Delaware limited liability company (Holdings), as a Guarantor, each of the other Guarantors (such terms and each other capitalized term used but not defined herein having the meaning given to it in Article I) party hereto upon becoming a party hereto, the Lenders and Issuing Banks from time to time party hereto, Goldman Sachs Bank USA, as administrative agent for the Lenders (in such capacity, together with its successors and assigns, the Administrative Agent), and as collateral agent for the Secured Parties (in such capacity, together with its successors and assigns, the Collateral Agent), as swing line lender (in such capacity, the Swing Line Lender) and as the Issuing Bank.
WITNESSETH:
WHEREAS, the Borrower, Holdings, the other Guarantors party thereto, the lenders party thereto and Goldman Sachs Bank USA, as administrative agent, collateral agent, swing line lender and as the issuing bank are party to that certain First Lien Credit Agreement, dated as of November 29, 2016 (as amended, amended and restated, supplemented or otherwise modified prior to the date hereof, the Existing First Lien Credit Agreement).
WHEREAS, on the Closing Date, the Borrower, Holdings, the Lenders, the Administrative Agent and the Collateral Agent intend to amend and restate the First Lien Credit Agreement as provided herein.
WHEREAS, the Borrower, Holdings, the other Guarantors party thereto, the lenders party thereto and Guggenheim Corporate Funding, LLC, as administrative agent and collateral agent are party to that certain Second Lien Credit Agreement, dated as of November 29, 2016 (as amended, amended and restated, supplemented or otherwise modified prior to the date hereof, the Second Lien Credit Agreement)
WHEREAS, on the Closing Date, the Borrower intends to (i) refinance in full the indebtedness owing to Exiting First Lien Term Loan Lenders under the Existing First Lien Credit Agreement (the First Lien Refinancing) and (ii) refinance in full all outstanding indebtedness under the Second Lien Credit Agreement and to terminate and release any and all security interests or guarantees in connection with the Second Lien Credit Agreement (the Second Lien Refinancing, and together with the First Lien Refinancing, the Closing Date Refinancing);
WHEREAS, on the Closing Date, the Borrower has requested that the Term Loan Lenders extend credit in the form of Term Loans in an aggregate principal amount equal to $700,000,000 to fund the Closing Date Refinancing, to pay fees, costs and expenses in connection therewith, to fund working capital needs and for other general corporate purposes.
NOW, THEREFORE, the Lenders are willing to (severally but not jointly) extend the credit described in the paragraph immediately above and make Revolving Loans from time to time to the Borrower and the Issuing Bank is willing to issue letters of credit for the account of the Borrower on the terms and subject to the conditions set forth herein. Accordingly, in consideration of the mutual covenants and agreements set forth herein and in the other Loan Documents, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms. As used in this Agreement, the following terms shall have the meanings specified below:
ABR when used in reference to any Loan or Borrowing, is used when such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Alternate Base Rate.
ABR Borrowing shall mean a Borrowing comprised of ABR Loans.
ABR Loan shall mean any ABR Term Loan or ABR Revolving Loan.
ABR Revolving Loan shall mean any Revolving Loan bearing interest at a rate determined by reference to the Alternate Base Rate in accordance with the provisions of Article II
ABR Term Loan shall mean any Term Loan bearing interest at a rate determined by reference to the Alternate Base Rate in accordance with the provisions of Article II
Additional Amount shall have the meaning assigned to such term in Section 2.15(a).
Additional Borrower shall mean any Wholly Owned Restricted Subsidiary incorporated under the laws of the United States, any state thereof or the District of Columbia that becomes a Borrower after the Closing Date pursuant to Section 2.24.
Additional Guarantor shall mean any Wholly Owned Restricted Subsidiary that becomes a Guarantor after the Closing Date pursuant to Section 5.10.
Additional Lender shall mean each Eligible Assignee that becomes a Lender.
Additional Revolving Commitment shall have the meaning assigned to such term in Section 2.20(a).
Adjusted LIBO Rate shall mean, with respect to any Eurodollar Borrowing for any Interest Period, (a) an interest rate per annum equal to the LIBO Rate for such Eurodollar Borrowing in effect for such Interest Period divided by (b) 1 minus the Statutory Reserves (if any) for such Eurodollar Borrowing for such Interest Period.
Administrative Agent shall have the meaning given to that term in the preamble hereto, and include each other person appointed as a successor pursuant to Article IX.
2
Administrative Agent Fee shall have the meaning assigned to such term in Section 2.05(b).
Administrative Questionnaire shall mean an Administrative Questionnaire in substantially the form of Exhibit A or in such other form as may be reasonably approved by the Administrative Agent.
Affiliate shall mean, when used with respect to a specified person, another person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the person specified; provided, however, that neither any Lender nor any Agent (nor any of their Affiliates) shall be deemed to be an Affiliate of Holdings, the Borrower or any of their respective Subsidiaries solely by virtue of its capacity as a Lender or Agent hereunder. For purposes of this Agreement and the other Loan Documents, Jefferies LLC and its Affiliates shall be deemed to be Affiliates of Jefferies Finance LLC and its Affiliates.
Affiliated Debt Fund shall mean a debt fund or other investment vehicle that is an Affiliate of the Sponsor and that is primarily engaged in, or advises funds or other investment vehicles that are engaged in, making, purchasing, holding or otherwise investing in commercial loans, notes, bonds and similar extensions of credit or securities in the ordinary course of its business and whose managers have fiduciary duties to the investors therein independent of or in addition to their duties to the Sponsor or any of its Affiliates.
Agents shall mean the Administrative Agent and the Collateral Agent; and Agent shall mean either of them.
Agreement shall have the meaning assigned to such term in the preamble hereto.
Alternate Base Rate shall mean, for any day, a rate per annum equal to the greatest of (a) the Base Rate in effect on such day, (b) the Federal Funds Rate in effect on such day plus 1/2 of 1.00%, and (c) the Adjusted LIBO Rate for a one month Interest Period on such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 1.00%. Any change in the Alternate Base Rate due to a change in the Base Rate, the Federal Funds Rate or the Adjusted LIBO Rate shall be effective on the effective date of such change in the Base Rate, the Federal Funds Rate or the Adjusted LIBO Rate, as the case may be.
Anti-Terrorism Laws shall have the meaning assigned to such term in Section 3.19.
Applicable Date of Determination shall mean, for purposes of determining Consolidated Total Funded Indebtedness and Unrestricted Cash for purposes of calculating the First Lien Leverage Ratio, the Senior Secured Leverage Ratio or the Total Leverage Ratio for purposes of determining whether an incurrence test has been satisfied, subject to Section 1,06, the date of the transaction subject to such incurrence test.
3
Applicable ECF Percentage shall mean, for any fiscal year of Holdings, (a) 50% if the First Lien Leverage Ratio (after giving effect to (i) any prepayments or buybacks described in Section 2.10(f)(B) and (ii) any such ECF Payment Amount assuming a 50% Applicable ECF Percentage) as of the last day of and for such fiscal year is greater than 4.00 to 1.00, (b) 25% if the First Lien Leverage Ratio (after giving effect to (i) any prepayments or buybacks described in Section 2.10(f)(B) and (ii) any such ECF Payment Amount assuming a 25% Applicable ECF Percentage) as of the last day of and for such fiscal year is greater than 3.50 to 1.00 but less than or equal to 4.00 to 1.00 and (c) 0% if the First Lien Leverage Ratio (after giving effect to any prepayments or buybacks described in Section 2.10(f)(B) as of the last day of such fiscal year is less than or equal to 3.50 to 1.00. For the avoidance of doubt, if, after giving effect to the parenthetical phrases in any of the foregoing subclauses more than one of the preceding subclauses would be applicable, the subclause with the highest percentage shall apply.
Applicable Margin shall mean a percentage per annum equal to, with respect to (a)(i) Term Loans that are Eurodollar Loans, 3.75% and (ii) Term Loans that are ABR Loans, 2.75% and (b) Revolving Loans, Swing Line Loans, LC Participation Fee and Commitment Fee, as set forth below for the appropriate level:
Level |
First Lien Leverage Ratio |
Applicable
Margin for Eurodollar Loans |
Applicable
Margin for ABR Loans and Swing Line Loans |
Applicable
Margin for LC Participation Fee |
Commitment Fee | |||||||||||||
I |
>4.00 to 1.00 | 3.75 | % | 2.75 | % | 3.75 | % | 0.50 | % | |||||||||
II |
<4.00 to 1.00 and > 3.50 to 1.00 | 3.50 | % | 2.50 | % | 3.50 | % | 0.375 | % | |||||||||
III |
< 3.50 to 1.00 | 3.25 | % | 2.25 | % | 3.25 | % | 0.25 | % |
provided that until a certified calculation of the First Lien Leverage Ratio is delivered for the first fiscal quarter for which financial statements are required to be delivered pursuant to Section 5.01(a) or (b), the Applicable Margin with respect to Revolving Loans and Swing Line Loans, the LC Participation Fee and the Commitment Fee shall be set at the margin in the row styled Level I in the applicable table. Except as set forth in the foregoing proviso, the Applicable Margin with respect to Revolving Loans and Swing Line Loans, the LC Participation Fee and the Commitment Fee shall be re-determined quarterly on the first Business Day of the month following the date of delivery to the Administrative Agent of a certified calculation of the First Lien Leverage Ratio in accordance with Section 5.01(c); provided that if such certification is not provided in accordance with Section 5.01(c), the Applicable Margin with respect to Revolving Loans and Swing Line Loans, the LC Participation Fee and the Commitment Fee shall be set at the margin in the row styled Level I in the applicable table as of the first Business Day of the month following the end of the quarter for which the certification was not delivered until the date on which such certification is delivered (on which date, the Applicable Margin with respect to Revolving Loans and Swing Line Loans, the LC Participation Fee and the Commitment Fee shall be set at the margin based upon the calculations disclosed by such certification).
4
In the event that the certified calculation of the First Lien Leverage Ratio previously delivered pursuant to Section 5.01(c) was inaccurate (and such inaccuracy is discovered while any Revolving Commitments are outstanding), and such inaccuracy, if corrected, would have led to the application of a higher Applicable Margin for the Revolving Loans or Swing Line Loans, the LC Participation Fee or the Commitment Fee, as applicable, for any period (an Applicable Period) than the Applicable Margin for Revolving Loans or Swing Line Loans, the LC Participation Fee or the Commitment Fee, as applicable, applied for such Applicable Period, then, to the extent any Revolving Commitments are outstanding at such time, (i) the Borrower shall as soon as practicable deliver to the Administrative Agent the correct certified calculation of the First Lien Leverage Ratio for such Applicable Period, (ii) the Applicable Margin for Revolving Loans or Swing Line Loans, the LC Participation Fee or the Commitment Fee, as applicable, shall be determined as if the Level for such higher Applicable Margin for Revolving Loans or Swing Line Loans, the LC Participation Fee or the Commitment Fee, as applicable, were applicable for such Applicable Period, and (iii) the Borrower shall within ten Business Days of written demand therefor by the Administrative Agent pay to the Administrative Agent the accrued additional interest with respect to Revolving Loans or Swing Line Loans, the LC Participation Fee or the Commitment Fee owing as a result of such increased Applicable Margin for Revolving Loans or Swing Line Loans, the LC Participation Fee or the Commitment Fee for such Applicable Period, which payment shall be promptly applied by the Administrative Agent in accordance with this Agreement.
Notwithstanding the foregoing, the Applicable Margin in respect of any Extended Loan shall be the applicable percentages per annum set forth in the relevant Extension Amendment.
Applicable Other Indebtedness shall have the meaning assigned to such term in Section 2.10(h).
Applicable Tax Laws shall mean the Code and any other applicable Requirement of Law relating to Taxes, as in effect from time to time.
Application shall have the meaning assigned to such term in Section 2.18(a).
Approved Fund shall mean any Fund or managed account that is administered, advised or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity, or an Affiliate of an entity, that administers, advises or manages a Lender.
Asset Sale shall mean (a) any conveyance, sale, transfer or other disposition of any property pursuant to Section 6.05(b) and (b) any issuance or sale of any Equity Interest of any Group Member (other than Holdings, and other than to any Group Member (other than in the case of an issuance or sale of any Equity Interest of any Credit Party to any Group Member that is not a Credit Party)), and in any event Asset Sales shall exclude Casualty Events of any Group Member.
5
Asset Sale Threshold shall have the meaning assigned to such term in Section 2.10(c)(i).
Assignment and Assumption shall mean an assignment and assumption entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 10.04(b)), and accepted by the Administrative Agent, in substantially the form of Exhibit B, or any other form (including electronic documentation generated by use of an electronic platform) approved by the Administrative Agent.
Attributable Indebtedness shall mean, when used with respect to any Sale Leaseback Transaction, as at the time of determination, the present value (discounted at a rate equivalent to the Borrowers then-current weighted average cost of funds for borrowed money as at the time of determination, compounded on a semi-annual basis) of the total obligations of the lessee for rental payments during the remaining term of the lease included in any such Sale Leaseback Transaction.
Audited Financial Statements shall mean the audited consolidated balance sheets and related statements of income, and cash flows of Holdings and its Restricted Subsidiaries for the most recently completed fiscal year ended at least 120 days before the Closing Date.
Auto-Renewal Letter of Credit shall have the meaning assigned to such term in Section 2.18(c)(ii).
Available Retained ECF Amount shall mean, at any date of determination, the portion of Excess Cash Flow, determined on a cumulative basis for all fiscal years of Holdings (commencing with the fiscal year ending December 31, 2018) that was not required to be applied to prepay Term Loans pursuant to Section 2.10(f) or to prepay any other Indebtedness pursuant to Section 2.10(h) on account of Section 2.10(f); provided that in no event shall the Available Retained ECF Amount be less than $0.
Bail-In Action shall mean the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.
Bail-In Legislation shall mean, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.
Bankruptcy Code shall mean the Federal Bankruptcy Reform Act of 1978, as heretofore and hereafter amended, and codified as 11 U.S.C. §§ 101 et seq. and the regulations issued thereunder.
Base Rate shall mean a rate per annum equal to the rate last quoted by The Wall Street Journal as the Prime Rate in the United States or, if The Wall Street Journal ceases to quote such rate, the highest per annum interest rate published by the Federal Reserve Board in Federal Reserve Statistical Release H.15 (519) (Selected Interest Rates) as the bank prime loan rate or, if such rate is no longer quoted therein, any similar rate quoted therein (as determined by the Administrative Agent) or any similar release by the Federal Reserve Board (as determined by the Administrative Agent).
6
Benefit Plan means any of (a) an Employee Benefit Plan that is subject to Title I of ERISA, (b) a plan as defined in Section 4975 of the Code or (c) any Person whose assets include (for purposes of ERISA Section 3(42) or otherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any such Employee Benefit Plan or plan.
Board shall mean the Board of Governors of the Federal Reserve System of the United States.
Board of Directors shall mean, with respect to any person, (a) in the case of any corporation, the board of directors of such person, (b) in the case of any limited liability company, the board of managers, manager or managing member of such person, (c) in the case of any partnership, the general partner of such person and (d) in any other case, the functional equivalent of the foregoing.
Bona Fide Debt Fund shall mean any debt Fund Affiliate of any Person described in clause (b) of the definition of Disqualified Institution that is primarily engaged in, or advises funds or other investment vehicles that are engaged in, making, purchasing, holding or otherwise investing in commercial loans, notes, bonds and similar extensions of credit or securities in the ordinary course of its business and whose managers have fiduciary duties to the investors therein independent of or in addition to their duties to such Person described in clause (b) of the definition of Disqualified Institution.
Borrower shall have the meaning assigned to such term in the preamble hereto; provided that the term Borrower shall include any Additional Borrower.
Borrowing shall mean (a) Loans of the same Class and Type, made, converted or continued on the same date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect or (b) a Swing Line Loan.
Borrowing Request shall mean a written request by the Borrower in accordance with the terms of Section 2.03 and substantially in the form of Exhibit C-l, or such other form (including any form on an electronic platform or electronic transmission system) as shall be approved by the Administrative Agent (which approval shall not be unreasonably withheld), appropriately completed and signed by a Responsible Officer of the Borrower.
Business Day shall mean any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the Requirements of Law of, or are in fact closed in, the state where the Administrative Agents office set forth in Section 10.01 is located (as modified from time to time in accordance with Section 10.01) and, if such day relates to any Eurodollar Loan, shall mean any such day that is also a day on which dealings in Dollar deposits are conducted by and between banks in the London interbank eurodollar market.
Capital Assets shall mean, with respect to any person, all equipment, rolling stock, aircraft, fixed assets and Real Property or improvements of such person, or replacements or substitutions therefor or additions thereto, that, in accordance with GAAP, have been or should be reflected as additions to property, plant or equipment on the balance sheet of such person.
7
Capital Expenditures shall mean, for any period, the aggregate of, without duplication, (a) all expenditures (whether paid in cash or accrued as liabilities) by Holdings and its Restricted Subsidiaries during such period that, in conformity with GAAP, are or are required to be included as additions during such period to property, plant or equipment reflected in the consolidated balance sheet of Holdings and its Restricted Subsidiaries and (b) Capital Lease Obligations incurred by Holdings and its Restricted Subsidiaries during such period.
Capital Lease Obligations shall mean, at the time any determination thereof is to be made, the amount of the liability in respect of a Capital Lease that would at such time be required to be capitalized and reflected as a liability on a balance sheet (excluding the footnotes thereto) prepared in accordance with GAAP.
Capital Leases shall mean all leases that are required to be, in accordance with GAAP, recorded as capitalized leases; provided that the adoption or issuance of any accounting standards after the Closing Date will not cause any lease that was not or would not have been a Capital Lease prior to such adoption or issuance to be deemed a Capital Lease.
Cash Equivalents shall mean, as to any person, (a) securities issued, or directly, unconditionally and fully guaranteed or insured, by the United States or any political subdivision, agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof) having maturities of not more than one year from the date of acquisition by such person; (b) securities issued, or directly, unconditionally and fully guaranteed or insured, by any state of the United States or any political subdivision of any such state or any public instrumentality thereof (provided that the full faith and credit of such state is pledged in support thereof) having maturities of not more than one year from the date of acquisition by such person; (c) time deposits and certificates of deposit of any Lender or any commercial bank having, or which is the principal banking subsidiary of a bank holding company organized under the laws of the United States, any state thereof or the District of Columbia having, capital and surplus aggregating in excess of $500,000,000 and a rating of A (or such other similar equivalent rating) or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act) with maturities of not more than one year from the date of acquisition by such person, and securities with maturities of one year or less from the date of acquisition backed by standby letters of credit issued by any Lender or any commercial bank satisfying the requirements of this clause (c); (d) repurchase obligations for underlying securities of the types described in clause (a), (b) or (c) above entered into with any bank meeting the qualifications specified in clause (c) above; (e) commercial paper issued by any person incorporated in the United States rated at least A-l or the equivalent thereof by S&P or at least P-1 or the equivalent thereof by Moodys, and in each case maturing not more than one year after the date of acquisition by such person; (f) investments in money market funds substantially all of whose assets are comprised of securities of the types described in clauses (a) through (e) above, or that (i) comply with the criteria set forth in SEC Rule 2a-7 under the Investment Company Act of 1940, as amended, (ii) are rated within the top three ratings categories by S&P or Moodys and (iii) have portfolio assets of at least $500,000,000; (g)
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demand deposit accounts maintained in the ordinary course of business; (h) preferred stock issued by Persons with a rating of A or higher from S&P or A-2 or higher from Moodys, with maturities of less than one year from the date of acquisition; (i) marketable short-term money market and similar securities having a rating of at least P-2 or A-2 from either Moodys or S&P, respectively (or, if at any time either Moodys or S&P shall not be rating such obligations, an equivalent rating from another nationally recognized statistical rating agency selected by Holdings) and in each case maturing within one year after the date of creation or acquisition thereof; (j) investment funds investing at least 90% of their assets in Cash Equivalents of the types described in clauses (a) through (j) above and (k)(i) investments of the type and (to the extent applicable) maturity described in clauses (a) through (i) above of (or maintained with) a comparable foreign obligor, which investments or obligors (or the parent thereof) have ratings described in clause (c) or (e) above, if applicable, or equivalent ratings from comparable foreign rating agencies or (ii) investments of the type and maturity (to the extent applicable) described in clauses (a) through (i) above of (or maintained with) a foreign obligor (or the parent thereof), which investments or obligors (or the parents thereof) are not rated as provided in such clauses or in subclause (i) of this clause (k) but which are, in the reasonable judgment of the Borrower, comparable in investment quality to such investments and obligors (or the parents of such obligors).
Cash Management Agreement shall mean any agreement to provide to any Group Member any cash management services, including treasury, depository, overdraft, credit or debit card, electronic funds transfer and other cash management arrangements.
Cash Management Bank shall mean any Person that is a creditor under a Cash Management Agreement, in its capacity as a party to such Cash Management Agreement; provided that if such Person is not (or was not, at the time it entered into a Cash Management Agreement) a Lender, an Agent or a Lead Arranger, such person shall deliver to the Administrative Agent a letter agreement pursuant to which such person (i) appoints the Collateral Agent as its agent under the applicable Loan Documents and (ii) agrees to be bound by the provisions of Sections 9,03, 10,03 and 10.09 as if it were a Lender.
Casualty Event shall mean any involuntary loss of title, any involuntary loss of, damage to or any destruction of, or any condemnation or other taking (including by any Governmental Authority) of, any property of any Group Member.
Casualty Event shall include but not be limited to any taking of all or any part of any Real Property of any Person or any part thereof, in or by condemnation or other eminent domain proceedings pursuant to any Requirement of Law, or by reason of the temporary requisition of the use or occupancy of all or any part of any Real Property of any Person or any part thereof by any Governmental Authority, civil or military, or any settlement in lieu thereof.
Casualty Event Threshold shall have the meaning set forth in Section 2.10(e)(i).
CFC shall mean a Foreign Subsidiary that is a controlled foreign corporation within the meaning of Section 957 of the Code.
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CFC Holding Company shall mean any Subsidiary substantially all of the assets of which are (a) Equity Interests (including any debt instrument treated as equity for U.S. federal income tax purposes) or (b) Equity Interests (including any debt instrument treated as equity for U.S. federal income tax purposes) and debt instruments, in the case of clauses (a) and (b), of one or more (x) Excluded Foreign Subsidiaries and (y) other Subsidiaries that are CFC Holding Companies pursuant to clause (x) of this definition.
Change in Law shall mean (a) the adoption of, or taking effect of, any law, treaty, order, rule or regulation after the date hereof, (b) any change in any law, treaty, order, rule or regulation (including, for the avoidance of doubt, the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith, and all requests rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III) or in the administration, interpretation, implementation or application thereof by any Governmental Authority after the date hereof or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) of any Governmental Authority (including, for the avoidance of doubt, pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act or pursuant to Basel III) made or issued after the date hereof.
A Change of Control shall be deemed to have occurred if:
(a) prior to an IPO, Permitted Holders (collectively) shall fail to own (directly or indirectly), or to have the power to vote or direct the voting of, directly or indirectly, Voting Stock of Holdings representing more than 50% of the voting power of the total outstanding Voting Stock of Holdings;
(b) upon and following an IPO, the Permitted Holders (collectively) shall fail to own (directly or indirectly), or to have the power to vote or direct the voting of, directly or indirectly, Voting Stock of Holdings representing more than 35% of the voting power of the total outstanding Voting Stock of Holdings, unless Permitted Holders have, at such time, the right or ability by voting power, contract or otherwise, to elect or designate for election at least a majority of the Board of Directors of Holdings;
(c) upon and following an IPO, any person or group (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), other than one or more Permitted Holders, is or becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that for purposes of this clause such person or group shall be deemed to have beneficial ownership of all securities that such person or group has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of Voting Stock of Holdings representing more than the total Voting Stock of Holdings then held by the Permitted Holders (collectively);
(d) Holdings shall cease to beneficially own and Control, directly or indirectly, 100% on a fully diluted basis of the economic and voting interests in the Equity Interests of each of the Borrower and Lanyon; or
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(e) a Change of Control (or equivalent term) as defined in the definitive debt documentation for any Indebtedness in excess of $21,500,000 in aggregate principal amount secured by the Collateral on a pari passu basis with or a junior basis to the Secured Obligations, Unsecured Indebtedness, Permitted Junior Refinancing Debt, Permitted Pari Passu Refinancing Debt, Permitted Unsecured Refinancing Debt, Registered Equivalent Notes, Permitted Incremental Equivalent Debt or Indebtedness incurred pursuant to a Permitted Refinancing of any of the foregoing, shall occur.
For purposes of this definition, a person acquiring any Voting Stock shall not be deemed to have beneficial ownership of such Voting Stock subject to a stock purchase agreement, merger agreement or similar agreement, so long as such agreement contains a condition to the closing of the transactions contemplated thereunder that the Obligations (other than contingent indemnification obligations, unasserted expense reimbursement obligations, obligations and liabilities under Secured Cash Management Agreements and Secured Hedging Agreements with respect to which arrangements satisfactory to the applicable Cash Management Bank or Hedge Bank shall have been made, and Letters of Credit that have been (i) cash collateralized in accordance with the terms of this Agreement, (ii) backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or (iii) rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank) under this Agreement and the other Loan Documents shall be paid in full and terminated prior to (or contemporaneously with) the consummation of such transactions.
Class subject to Section 2.21 and Section 2.22, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans, Term Loans or Swing Line Loans and, when used in reference to any Commitment, refers to whether such Commitment is a Revolving Commitment, Term Loan Commitment or Swing Line Commitment, in each case, under this Agreement as originally in effect or pursuant to Section 2.20.
Closing Date shall mean the date of the initial Credit Extensions hereunder.
Closing Date Refinancing shall have the meaning assigned to such term in the recitals hereto.
Code shall mean the Internal Revenue Code of 1986, as amended from time to time, unless otherwise specified.
Collateral shall mean, collectively, all of the Security Agreement Collateral and all other property of whatever kind and nature, whether now owned or hereinafter acquired, subject or purported to be subject from time to time to a Lien under any Security Document.
Collateral Agent shall have the meaning assigned to such term in the preamble hereto, and include each other person appointed as a successor thereto pursuant to Article IX.
Commercial Letter of Credit shall mean any letter of credit or similar instrument intended to serve as the means of payment in a purchase of goods or services.
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Commitment shall mean, with respect to any Lender, such Lenders Revolving Commitment, Term Loan Commitment or Swing Line Commitment.
Commitment Fee shall have the meaning assigned to such term in Section 2.05(a).
Commodity Exchange Act shall mean the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.
Communications shall have the meaning assigned to such term in Section 10.01(d).
Compliance Certificate shall mean a certificate of a Financial Officer substantially in the form of Exhibit D.
Consolidated Amortization Expense shall mean, for any period, the amortization expense of Holdings and its Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP, and including, without limitation, amortization of goodwill, software and other intangible assets.
Consolidated Cash Interest Expense shall mean, for any period, the Consolidated Interest Expense excluding any non-cash interest expense of Holdings and its Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP.
Consolidated Current Assets shall mean, as at any date of determination, the total assets of Holdings and its Restricted Subsidiaries which may properly be classified as current assets (excluding deferred tax assets without duplication of amounts otherwise added in calculating Excess Cash Flow) on a consolidated balance sheet of Holdings and its Restricted Subsidiaries in accordance with GAAP, excluding cash and Cash Equivalents; provided that Consolidated Current Assets shall be calculated without giving effect to the impact of purchase accounting.
Consolidated Current Liabilities shall mean, as at any date of determination, the total liabilities (excluding deferred taxes and taxes payable, in each case, without duplication of amounts otherwise deducted in calculating Excess Cash Flow) of Holdings and its Restricted Subsidiaries which may properly be classified as current liabilities (other than the current portion of any Indebtedness and other long term liabilities, and accrued interest thereon) on a consolidated balance sheet of Holdings and its Restricted Subsidiaries in accordance with GAAP; provided that Consolidated Current Liabilities shall be calculated without giving effect to the impact of purchase accounting.
Consolidated Depreciation Expense shall mean, for any period, the depreciation expense of Holdings and its Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP.
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Consolidated EBITDA shall mean, for any period, Consolidated Net Income for such period, adjusted by (x) adding thereto, in each case only to the extent (and in the same proportion) deducted in determining such Consolidated Net Income (other than in respect of clauses (f), (o) and (r) below) and without duplication:
(a) Consolidated Interest Expense;
(b) Consolidated Amortization Expense;
(c) Consolidated Depreciation Expense;
(d) Consolidated Tax Expense;
(e) Consolidated Transaction Costs;
(f) (x) pro forma adjustments consistent with those previously identified in the bank case projection model delivered to the Administrative Agent on October 25, 2017, and (y) run rate cost savings, operating expense reductions, other operating improvements and initiatives and synergies projected by the Borrower to result from action either taken or expected to be taken in connection with, and within 24 months following, any acquisition (including the commencement of activities constituting a business) or material disposition (including the termination or discontinuance of activities constituting a business), in each case of business entities or of properties or assets constituting a division or line of business (including, without limitation, a product line), and/or any other operational change (including, to the extent applicable, in connection with the Transactions or any restructuring) (which will be added to Consolidated EBITDA as so projected until fully realized and calculated on a Pro Forma Basis as though such synergies, cost savings, operating expense reductions, other operating improvements and initiatives had been realized on the first day of such period), net of the amount of actual benefits realized during such period from such actions; provided that amounts added back to Consolidated EBITDA pursuant to this clause (f)(y) shall not, in the aggregate, exceed 25% of Consolidated EBITDA for any four fiscal quarter period (determined prior to giving effect thereto) (in each case, other than any amounts added back to Consolidated EBITDA which constitute operational improvements made in connection with the Transactions (as defined in the Existing First Lien Credit Agreement));
(g) any charge, expense, cost, accrual, reserve, payment, fee, expense or loss of any kind (Charges) (including rationalization, legal, tax, structuring and other costs and expenses) (other than depreciation or amortization expense) related to any consummated, anticipated, unsuccessful or attempted equity offering (including an IPO), issuance or repurchase, other Equity Issuance, incurrence by Holdings or any of its Subsidiaries of Indebtedness (including an amendment thereto or a refinancing thereof, whether or not successful, and any costs of surety bonds incurred in connection with successful or unsuccessful financing activities), Dividend (including the amount of expenses relating to payments made to option holders of any direct or indirect parent of the Borrower in connection with, or as a result of, any distribution being made to equityholders of such Person, which payments are being made to compensate such option holders as though they were equityholders at the time of, and entitled to share in, such distribution, in each case to the extent permitted under this Agreement), Investment, acquisition (including the Original Acquisition and any Permitted Acquisition or other Investments) (including (x) bonuses paid to employees, severance and reorganization costs
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and expenses in connection with any Permitted Acquisition and other investments permitted hereunder, (y) fees, costs and expenses incurred in connection with the de-listing of public targets or compliance with public company requirements in connection any Permitted Acquisition or other Investment, and any Public Company Costs, and (z) to the extent arising in the context of take private Permitted Acquisitions or Investments, litigation expenses and settlement amounts), Asset Sale or other disposition, consolidations, restructurings, repayment of Indebtedness (including Restricted Debt Payments) or recapitalization or the breakage of any hedging arrangement permitted hereunder or the incurrence of Indebtedness permitted to be incurred hereunder (including a refinancing thereof) (in each case, whether or not successful), including such Charges related to (i) the offering, syndication, assignment and administration of the loans under the Loan Documents and any other credit facilities (including, and together with Charges of S&P, Moodys or any other nationally recognized ratings agency in order to comply with the terms of Section 5.12) and (ii) any refinancing, extension, waiver, forbearance, amendment or other modification of the Loan Documents and any other credit facilities (in each case, whether consummated, anticipated, unsuccessful, attempted or otherwise);
(h) (i) any non-cash Charges, impairment Charges (including bad debt expense), write-downs, write-offs, expenses, losses or items (including, without limitation, purchase accounting adjustments under ASC 805 or similar recapitalization accounting or acquisition accounting under GAAP or similar provisions under GAAP, or any amortization or write-off of any amounts thereof (including, without limitation, with respect to inventory, property and equipment, leases, software, goodwill, intangible assets, in-process research and development, deferred revenue, advanced billings and debt line items)) (including any (x) noncash expense relating to the vesting of warrants, (y) non-cash asset retirement costs, and (z) noncash increase in expenses resulting from the revaluation of inventory (including any impact of changes to inventory valuation policy methods (including changes in capitalization of variances)) or other inventory adjustments), including any such charges, impairment charges, write-downs, write-offs, expenses, losses or items pushed down to Holdings and its Restricted Subsidiaries, (ii) net unrealized or realized exchange, translation or performance losses relating to foreign currency transactions and foreign exchange adjustments including, without limitation, losses and expenses in connection with, and currency and exchange rate fluctuations and losses or other obligations from, hedging activities or other derivative instruments, and (iii) cash Charges resulting from the application of ASC 805 or similar provisions under GAAP (including with respect to Earn-Outs incurred by Holdings, the Borrower or any of their Restricted Subsidiaries in connection with any Permitted Acquisition or other Investment (including any acquisition or other Investment consummated prior to the Closing Date) and paid or accrued during the applicable period);
(i) (i) the amount of management, advisory, monitoring, consulting, refinancing, subsequent transaction and exit fees (including termination fees) and similar fees and expenses and related indemnities and expenses paid or accrued to direct or indirect equity holders of Holdings (and their Affiliates), including any such fees, expenses and indemnities required to be paid pursuant to the Management Services Agreement and payments for any financial advisory, financing, underwriting or placement services or in respect of other investment banking activities, to the extent such payments are permitted hereunder, and (ii) directors fees and expenses paid or accrued;
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(j) Charges that are covered by indemnification, reimbursement, guaranty, purchase price adjustment or other similar provisions in favor of Holdings or its Restricted Subsidiaries in any agreement entered into by Holdings or any of its Restricted Subsidiaries to the extent such expenses and payments have been reimbursed pursuant to the applicable indemnity, guaranty or acquisition agreement in such period (or are reasonably expected to be so paid or reimbursed within one year after the end of such period to the extent not accrued) or an earlier period if not added back to Consolidated EBITDA in such earlier period; provided that if such amount is not so reimbursed within such one year period, such expenses or losses shall be subtracted in the subsequent calculation period;
(k) Insurance Loss Addbacks; provided that if such amount is both (i) added back to Consolidated EBITDA and (ii) not so reimbursed or received by the Borrower or its Restricted Subsidiaries within such one year period applicable thereto, then such Insurance Loss Addback shall be subtracted in the subsequent Test Period;
(l) the aggregate amount of proceeds of business interruption insurance received by Holdings or one of its Restricted Subsidiaries during such period (or so long as such amount is reasonably expected to be received in a subsequent calculation period and within one year from the date of the underlying loss) to the extent not already included in Consolidated Net Income; provided that, if such amount is both (i) added back to Consolidated EBITDA and (ii) not so reimbursed or received by Holdings or such Restricted Subsidiary within such one year period, then such expenses or losses shall be subtracted in the subsequent calculation period;
(m) any exceptional, extraordinary, unusual or non-recurring expenses, losses or Charges incurred;
(n) Charges attributable to or associated with any restructuring (including restructuring charges related to Permitted Acquisitions and other Investments permitted hereunder and adjustments to existing reserves), carve out, integration, implementation of new initiatives, business optimization activities, cost savings, cost rationalization programs, operating expense reductions, synergies and/or similar initiatives, retention, recruiting, relocation, rebranding, signing bonuses, Charges in connection with a single or one-time event (including without limitation, in connection with facility openings, pre-openings, closings, reconfigurations and/or consolidations), research and development, contract termination Charges, stock option and other equity-based compensation expenses, any Charges associated with any stock subscription or shareholder agreement or any employee benefit trust, severance costs, Charges associated with systems implementation, software development, project start-up and new operations (including, without limitation, any Charges in connection with entering into a new market), corporate development, any Charges associated with any modification of any pension or post-retirement employee benefit plan, indemnities and expenses, transaction fees and expenses, management fees and expenses, including, without limitation, any one time expense relating to enhanced accounting function or other transaction costs, including those associated with becoming a standalone entity or a public company (including, for the avoidance of doubt, Public Company Costs);
(o) solely for purposes of determining compliance with Section 6.08 (and solely to the extent made in compliance with Section 8.03(a)), in respect of any period which includes a Cure Quarter, the Cure Amount in connection with an Equity Cure Contribution in respect of such Cure Quarter;
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(p) (i) compensation expenses resulting from the repurchase of Equity Interests of Holdings or any of its parent companies from employees, directors or consultants of Holdings or any of its Restricted Subsidiaries, in each case, to the extent permitted by this Agreement, (ii) non-cash costs and expenses relating to any equity-based compensation or equity-based incentive plan of Holdings (or its direct or indirect parent company) or any of its Restricted Subsidiaries and (iii) compensation payments resulting from payments to employees, directors or officers of Holdings and its Restricted Subsidiaries paid in connection with Dividends that are otherwise permitted hereunder to the extent such payments are not made in lieu of, or a substitution for, ordinary salary or ordinary payroll payments;
(q) any net losses attributable to the early extinguishment or repayment of Indebtedness (and the termination of any associated hedging agreements) including, for the avoidance of doubt, any unamortized fees, costs and expenses paid in connection therewith;
(r) other adjustments that are (i) contained in a quality of earnings report made available to the Administrative Agent prepared by financial advisors (which financial advisors are (A) nationally recognized or (B) reasonably acceptable to the Administrative Agent (it being understood and agreed that any of the Big Four accounting firms are acceptable)) and retained by a Credit Party, (ii) determined on a basis consistent with Article 11 of Regulation S- X promulgated under the Exchange Act and as interpreted by the staff of the SEC (or any successor agency), (iii) included in the definition of Consolidated EBITDA as set forth in the Existing First Lien Credit Agreement or (iv) approved by the Administrative Agent;
(s) letter of credit fees;
(t) net realized losses from Hedging Agreements, embedded derivatives or other derivatives resulting from actions outside of the ordinary course of trading (provided that, for the avoidance of doubt, losses resulting from ordinary course of trading Hedging Agreements or other derivatives shall not be added back pursuant to this clause (t));
(u) the net amount, if any, of the difference between (to the extent the amount in the following clause (i) exceeds the amount in the following clause (ii)): (i) the deferred revenue of such Person and its Restricted Subsidiaries as of the last day of such period (the Determination Date) and (ii) the deferred revenue such Person and its Restricted Subsidiaries as of the date that is twelve months prior to the Determination Date;
(v) any net loss from disposed, abandoned, transferred, closed or discontinued operations (excluding held for sale discontinued operations until actually disposed of);
(w) the amount of any loss or discount on any sale of (x) Receivables Assets and related assets in connection with a Receivables Facility or (y) Securitization Assets and related assets in connection with a Qualified Securitization Financing;
(x) any net loss included in Consolidated Net Income attributable to noncontrolling interests in any non-Wholly Owned Subsidiary or any joint venture;
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(y) all Charges attributable to, and payments of, legal settlements, fines, judgments or orders; and
(z) all cash actually received (or any netting arrangements resulting in reduced cash expenditures) during the relevant period and not included in Consolidated Net Income in respect of any non-cash gain deducted in the calculation of Consolidated EBITDA (including any component definition) for any previous period and not added back during such period;
and (y) subtracting therefrom, in each case only to the extent (and in the same proportion) added in determining such Consolidated Net Income and without duplication, the aggregate amount of (A) all non-cash items increasing Consolidated Net Income for such period (other than the accrual of revenue or recording of receivables in the ordinary course of business), (B) any extraordinary, unusual or non-recurring gains increasing Consolidated Net Income for such period, (C) any net realized gains from Hedging Agreements, embedded derivatives or other derivatives resulting from actions outside of the ordinary course of trading (provided that, for the avoidance of doubt, gains resulting from ordinary course of trading Hedging Agreements or other derivatives shall not be subtracted pursuant to this clause (C)), (D) any net gain from disposed, abandoned, transferred, closed or discontinued operations (excluding held for sale discontinued operations until actually disposed of), (E) the net amount, if any, of the difference between (to the extent the amount in the following clause (i) exceeds the amount in the following clause (ii)): (i) the deferred revenue of such Person and its Restricted Subsidiaries as of the date that is twelve months prior to the Determination Date (as defined above) and (ii) the deferred revenue of such Person and its Restricted Subsidiaries as of the Determination Date; (G) the amount of any minority interest net income attributable to non-controlling interests in any non- Wholly Owned Subsidiary or any joint venture; (H) net unrealized or realized exchange, translation or performance income or gains relating to foreign currency transactions and foreign exchange adjustments including, without limitation, income or gains in connection with, and currency and exchange rate fluctuations and income or gains from, hedging activities or other derivative instruments; and (I) the amount of any income or gain on any sale of (x) Receivables Assets and related assets in connection with a Receivables Facility or (y) Securitization Assets and related assets in connection with a Qualified Securitization Financing.
Notwithstanding anything to the contrary, it is agreed that, for the purpose of calculating the First Lien Leverage Ratio, the Senior Secured Leverage Ratio, the Total Leverage Ratio and the Consolidated Interest Coverage Ratio for any period that includes the fiscal quarters ended on December 31, 2016, March 31, 2017, June 30, 2017 or September 30, 2017, Consolidated EBITDA shall be deemed to be $31,699,000, $72,666,000, $13,800,000 and $35,407,000, respectively, in each case, as adjusted on a Pro Forma Basis and to give effect to any adjustments in clauses (f) and (r) above that in each case may become applicable due to actions taken on or after the Closing Date, as applicable; it being agreed that for purposes of calculating any financial ratio or test in connection with a Subject Transaction, Consolidated EBITDA shall be calculated on a Pro Forma Basis in a manner consistent with Consolidated EBITDA for each quarterly period set forth above and the adjustments set forth above in this definition. Other than for purposes of calculating Excess Cash Flow, Consolidated EBITDA shall be calculated on a Pro Forma Basis to give effect to any Subject Transaction as if it occurred on the first day of the reference period.
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Consolidated Interest Coverage Ratio shall mean, as of any date of determination, the ratio of (i) Consolidated EBITDA for the Test Period then most recently ended to (ii) Consolidated Cash Interest Expense for such Test Period.
Consolidated Interest Expense shall mean, for any period, the total consolidated interest expense of Holdings and its Restricted Subsidiaries for such period with respect to Consolidated Total Funded Indebtedness determined on a consolidated basis in accordance with GAAP plus, without duplication:
(a) imputed interest on Capital Lease Obligations and Attributable Indebtedness of Holdings and its Restricted Subsidiaries for such period;
(b) commissions, discounts and other fees, costs and Charges owed by Holdings or any of its Restricted Subsidiaries with respect to letters of credit, bankers acceptance financings and receivables financings for such period;
(c) amortization of costs in connection with the incurrence by Holdings or any of its Subsidiaries of Indebtedness, debt discount or premium and other financing fees and expenses incurred by Holdings or any of its Restricted Subsidiaries for such period;
(d) cash contributions to any employee stock ownership plan or similar trust made by Holdings or any of its Restricted Subsidiaries to the extent such contributions are used by such plan or trust to pay interest or fees to any person (other than Holdings or any of its Restricted Subsidiaries) in connection with Indebtedness incurred by such plan or trust for such period;
(e) all interest paid or payable with respect to discontinued operations of Holdings or any of its Restricted Subsidiaries for such period;
(f) the interest portion of any deferred payment obligations of Holdings or any of its Restricted Subsidiaries for such period; and
(g) all interest on any Indebtedness of Holdings or any of its Restricted Subsidiaries of the type described in clauses (f) or (i) of the definition of Indebtedness for such period;
provided that (a) to the extent directly related to the Transactions, debt issuance costs, debt discount or premium and other financing fees and expenses shall be excluded from the calculation of Consolidated Interest Expense, (b) commissions, discounts, yield, and other fees and Charges (including any interest expense) related to any Receivables Facility or any Securitization Facility shall be excluded from the calculation of Consolidated Interest Expense, and (c) Consolidated Interest Expense shall be calculated after giving effect to Hedging Agreements related to interest rates (including associated costs), but excluding unrealized gains and losses with respect to Hedging Agreements related to interest rates.
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Consolidated Interest Expense shall be calculated on a Pro Forma Basis to give effect to any Indebtedness (other than Indebtedness incurred for ordinary course working capital needs under ordinary course revolving credit facilities) incurred, assumed or permanently repaid or prepaid or extinguished at any time on or after the first day of the Test Period and prior to the date of determination in connection with the Transactions, any Permitted Acquisitions, Asset Sales or other dispositions (other than any Asset Sales or other dispositions in the ordinary course of business), and discontinued division or line of business (including, without limitation, a product line) or operations as if such incurrence, assumption, repayment or extinguishing had been effected on the first day of such period in each case to the extent permitted by this Agreement.
Consolidated Net Income shall mean, for any period, the consolidated net income (or loss) attributable to Holdings and its Restricted Subsidiaries determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded from such net income (to the extent otherwise included therein), without duplication:
(a) the net income (or loss) of any person that is not a Restricted Subsidiary of Holdings, except to the extent that cash in an amount equal to any such income has actually been received by Holdings or (subject to clause (b) below) any of its Restricted Subsidiaries during such period;
(b) the net income of any Restricted Subsidiary of Holdings during such period to the extent that the declaration or payment of Dividends or similar distributions by such Restricted Subsidiary of that income is not permitted by operation of the terms of its Organizational Documents or any agreement (other than this Agreement, any other Loan Document or any refinancings thereof), instrument, or Requirement of Law applicable to that Restricted Subsidiary or its equity holders during such period (unless such restriction or limitation has been waived), except that Holdings equity in the net loss of any such Restricted Subsidiary for such period shall be included in determining Consolidated Net Income;
(c) any gain (or loss), together with any related provisions for taxes on any such gain (or the tax effect of any such loss), realized during such period by Holdings or any of its Restricted Subsidiaries upon any Asset Sale or other disposition by Holdings or any of its Restricted Subsidiaries which is not sold or otherwise disposed of in the ordinary course of business;
(d) any foreign currency translation gains or losses (including losses related to currency remeasurements of Indebtedness);
(e) non-cash gains and losses resulting from any reappraisal, revaluation or write-up or write-down of assets;
(f) unrealized gains and losses, and the impact of any revaluation, with respect to Hedging Obligations, embedded derivatives or other derivative transactions other than, in each case, unrealized gains or losses with respect to Hedging Obligations or other derivatives which are accounted for on a hedge accounting basis (which, for the avoidance of doubt, shall be included in net income) and provided, that, for the avoidance of doubt, realized gains or losses in respect of Hedging Obligations or other derivatives entered into for nonspeculative purposes shall be included in net income; and
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(g) gains or losses due solely to the cumulative effect of any change in accounting principles (effected either through cumulative effect adjustment or retroactive application, in each case, in accordance with GAAP) and changes as a result of the adoption or modification of accounting policies during such period.
Consolidated Tax Expense shall mean, for any period, the tax expense (including, without limitation, federal, state, local, foreign, franchise, excise, property and foreign withholding and similar taxes) of Holdings and its Restricted Subsidiaries, including any penalties and interest relating therefrom or arising from any tax examinations for such period, determined on a consolidated basis in accordance with GAAP.
Consolidated Total Assets shall mean, as of any date, the total property and assets of Holdings and its Restricted Subsidiaries, determined in accordance with GAAP, as set forth on the consolidated balance sheet of Holdings most recently delivered pursuant to Section 5.01(a) or (b), as applicable (on a Pro Forma Basis after giving effect to any Permitted Acquisitions or any Investments or dispositions permitted hereunder or by the other Loan Documents).
Consolidated Total Funded Indebtedness shall mean, as of any date of determination, for Holdings and its Restricted Subsidiaries determined on a consolidated basis, the sum of, without duplication, (a) the aggregate principal amount of all funded Indebtedness for borrowed money, (b) all Purchase Money Obligations, (c) the principal portion of Capital Lease Obligations and (d) Letters of Credit (solely to the extent of any unreimbursed amounts thereunder that are not paid within one Business Day after the same become due and payable). Notwithstanding the foregoing, in no event shall the following constitute Consolidated Total Funded Indebtedness: (i) obligations under any derivative transaction or other Hedging Agreement, (ii) undrawn Letters of Credit, (iii) Earn-Outs to the extent not then due and payable and if not recognized as debt on the balance sheet in accordance with GAAP and (iv) leases that would be characterized as operating leases in accordance with GAAP on the date hereof.
Consolidated Transaction Costs shall mean the fees, premiums, costs, expenses, accruals and reserves (including rationalization, legal, tax, structuring and other costs and expenses) incurred by Holdings and its Restricted Subsidiaries, whether before or after the Closing Date, in connection with the Original Acquisition, the Transactions or the Closing Date Refinancing.
Contingent Obligation shall mean, as to any person, any obligation or agreement of such person guaranteeing or intended to guarantee any Indebtedness, leases, Dividends or other obligations (primary obligations) of any other person (the primary obligor) in any manner, whether directly or indirectly, including any such obligation or agreement of such person, whether or not contingent, (a) to purchase any such primary obligation or any property constituting direct or indirect security therefor; (b) to advance or supply funds (i) for the purchase or payment of any such primary obligation or (ii) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor; (c) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation; (d) with respect to bankers acceptances, letters of credit
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and similar credit arrangements, until a reimbursement obligation arises (which reimbursement obligation shall constitute Indebtedness); or (e) otherwise to assure or hold harmless the holder of such primary obligation against loss in respect thereof; provided, however, that the term Contingent Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business or any product warranties or other similar contingent obligations incurred in the ordinary course of business, including indemnities. The amount of any Contingent Obligation shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Contingent Obligation is made (or, if less, the maximum amount of such primary obligation for which such person may be liable, whether singly or jointly, pursuant to the terms of the instrument evidencing such Contingent Obligation) or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such person is required to perform thereunder) as determined by such person in good faith.
Control shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a person, whether through the ownership of voting securities, by contract or otherwise, and the terms Controlling and Controlled shall have meanings correlative thereto.
Controlled Investment Affiliate shall mean, as to any person, any other person which directly or indirectly is in Control of, is Controlled by, or is under common Control with, such person and is organized by such person (or any person Controlling such person) primarily for making equity or debt investments in Holdings or its direct or indirect parent company or other portfolio companies of such person.
Credit Agreement Refinancing Indebtedness shall mean (a) Permitted Pari Passu Refinancing Debt, (b) Permitted Junior Refinancing Debt, or (c) Permitted Unsecured Refinancing Debt obtained pursuant to a Refinancing Amendment, in each case, issued, incurred or otherwise obtained (including by means of the extension or renewal of existing Indebtedness) in exchange for, or to extend, renew, replace or refinance, in whole or part, existing Term Loans, Incremental Term Loans, Refinancing Term Loans, Revolving Loans, Incremental Revolving Loans or Refinancing Revolving Loans hereunder (including any successive Credit Agreement Refinancing Indebtedness) (Refinanced Debt); provided that (i) such extending, renewing or refinancing Indebtedness is in an original aggregate principal amount not greater than (A) the aggregate principal amount of the Refinanced Debt, plus (B) accrued and unpaid interest thereon, any fees, premiums, accrued interest associated therewith, or other reasonable amount paid, and fees, costs and expenses, commissions or underwriting discounts incurred in connection therewith, plus (C) an amount equal to any existing commitments unutilized under such Refinanced Debt not established in contemplated of such refinancing, plus (D) such additional amounts otherwise permitted to be incurred under the Loan Documents (with a corresponding reduction in the amount of any basket or carve-out (to the extent capped) used pursuant to this clause (D)), (ii) the terms applicable to such Credit Agreement Refinancing Indebtedness comply with the Required Debt Terms and (iii) such Refinanced Debt (other than unasserted contingent indemnification or reimbursement obligations and letters of credit that have been cash collateralized, rolled into another credit facility or backstopped in accordance with the terms thereof) shall be repaid, defeased or satisfied and discharged, and (unless otherwise agreed by all Lenders holding such Refinanced Debt) all accrued interest, fees and premiums (if any) in connection therewith shall be paid on the date such Credit Agreement Refinancing Indebtedness is issued, incurred or obtained.
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Credit Extension shall mean, as the context may require, (i) the making of a Loan by a Lender or (ii) the issuance of any Letter of Credit, or the extension or renewal of any existing Letter of Credit, by the Issuing Bank.
Credit Parties shall mean the Borrower and the Guarantors; and Credit Party shall mean any one of them.
Cumulative Amount shall mean, on any date of determination (the Reference Date), the sum of (without duplication):
(a) an amount equal to the greater of (i) $55,000,000 and (ii) 35% of Consolidated EBITDA for the most recent Test Period; plus
(b) the Available Retained ECF Amount; plus
(c) an amount determined on a cumulative basis equal to the Net Cash Proceeds received by Holdings after the Closing Date (and contributed as common capital or Qualified Capital Stock to the Borrower) from Eligible Equity Issuances, to the extent Not Otherwise Applied; plus
(d) an amount determined on a cumulative basis equal to the Net Cash Proceeds received by Holdings (and contributed as common capital or Qualified Capital Stock to the Borrower) from Indebtedness or Disqualified Capital Stock issued after the Closing Date and subsequently converted or exchanged into Qualified Capital Stock of Holdings or any direct or indirect parent company of Holdings, to the extent Not Otherwise Applied; plus
(e) the aggregate amount of Retained Declined Proceeds held by any Group Member during the period from the Business Day immediately following the Closing Date through and including the Reference Date; plus
(f) to the extent not already included in the calculation of Consolidated Net Income of Holdings and its Restricted Subsidiaries, the aggregate amount of all cash dividends and other cash distributions received by any Group Member from any joint ventures or Unrestricted Subsidiaries during the period from the Business Day immediately following the Closing Date through and including the Reference Date solely to the extent the original Investment therein was made using the Cumulative Amount and solely up to the original amount of the Investment therein; plus
(g) to the extent not already included in the calculation of Consolidated Net Income of Holdings and its Restricted Subsidiaries, the aggregate amount of all Net Cash Proceeds received by any Group Member in connection with the sale, transfer or other disposition of its ownership interest in any joint venture or Unrestricted Subsidiary during the period from the Business Day immediately following the Closing Date through and including the Reference Date solely to the extent the original Investment therein was made using the Cumulative Amount and solely up to the original amount of the Investment therein; plus
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(h) the aggregate amount of all Net Cash Proceeds received by any Group Member in connection with the sale, transfer or other disposition of its ownership interest in, or cash amounts of any returns, dividends, profits, distributions and similar amounts received on, any Investment (including in any Unrestricted Subsidiary or a joint venture) made pursuant to Section 6.03(x), up to the amount of the original Investment, during the period from the Business Day immediately following the Closing Date through and including the Reference Date; plus
(i) in the event that the Borrower re-designates any Unrestricted Subsidiary as a Restricted Subsidiary after the Closing Date (which, for purposes hereof, shall be deemed to also include (A) the merger, consolidation, liquidation or similar amalgamation of any Unrestricted Subsidiary into the Borrower or any Restricted Subsidiary, so long as the Borrower or such Restricted Subsidiary is the surviving Person, and (B) the transfer of any assets of an Unrestricted Subsidiary to the Borrower or any Restricted Subsidiary), the lower of (x) the fair market value (as determined in good faith by the Borrower) of the Investment in such Unrestricted Subsidiary or such transferred assets at the time of such re-designation and (y) the amount of the original Investment in such Unrestricted Subsidiary, in each case to the extent such Investment was made using the Cumulative Amount; minus
(j) (i) the aggregate amount of Investments made pursuant to Section 6.03(x) using the Cumulative Amount, (ii) the aggregate amount of Dividends made pursuant to Section 6.06(f) using the Cumulative Amount and (iii) the aggregate amount of prepayments of indebtedness pursuant to Section 6.09(a) using the Cumulative Amount, in each case during the period from and including the Business Day immediately following the Closing Date through and including the Reference Date (without taking account of the intended usage of the Cumulative Amount on such Reference Date).
Cure Amount shall have the meaning assigned to such term in Section 8.03(a).
Cure Expiration Date shall have the meaning assigned to such term in Section 8.03(a).
Cure Quarter shall have the meaning assigned to such term in Section 8.03(a).
Cvent shall have the meaning assigned to such term in the preamble hereto.
Debt Issuance shall mean the incurrence by Holdings or any of its Restricted Subsidiaries of any Indebtedness after the Closing Date (other than Indebtedness permitted by Section 6.01 to the extent not Credit Agreement Refinancing Indebtedness).
Debt Service shall mean, for any period, Consolidated Interest Expense for such period plus principal amortization (and other mandatory prepayments and repayments (whether pursuant to this Agreement or otherwise)) of all Indebtedness for such period (including, without limitation, the implied principal component of payments made in respect of Capital Lease Obligations).
Debtor Relief Law shall mean the Bankruptcy Code and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the United States or other applicable jurisdictions from time to time in effect and any other matters which are set out as qualifications or reservations as to matters of law of general application in any legal opinion provided in connection with this Agreement.
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Declined Proceeds shall have the meaning assigned to such term in Section 2.10(i).
Default shall mean any event, occurrence or condition which is, or upon notice, lapse of time or both would constitute, an Event of Default.
Default Excess shall mean, with respect to any Defaulting Lender, the excess, if any, of such Defaulting Lenders Pro Rata Percentage of the aggregate outstanding principal amount of Revolving Loans of all Revolving Lenders (calculated as if all Defaulting Lenders (including such Defaulting Lender) had funded all of their respective defaulted Revolving Loans) over the aggregate outstanding principal amount of Revolving Loans of such Defaulting Lender.
Default Rate shall have the meaning assigned to such term in Section 2.06(c).
Defaulting Lender shall mean any Lender, as reasonably determined by the Administrative Agent in a manner consistent with similar determinations by the Administrative Agent in respect of other Lenders, that (a) has failed to fund any portion of its Loans or Incremental Loans or participations in Letters of Credit required to be funded by it hereunder or under any commitment to fund an Incremental Loan within one Business Day of the date on which such amount is required to be funded by it hereunder or under any commitment to fund an Incremental Loan unless such Lender notifies the Administrative Agent, the Issuing Bank and the Borrower in writing that such failure is the result of such Lenders reasonable and good faith determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, (b) has notified the Administrative Agent, the Issuing Bank, any Lender and/or the Borrower in writing that it does not intend to comply with any of its funding obligations under this Agreement or any documentation relating to an Incremental Facility or has made a public statement to the effect that it does not intend to comply with its funding obligations under this Agreement or under any Incremental Facility (unless such writing or public statement states that such position is based on such Lenders reasonable and good faith determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within two Business Days after request by the Administrative Agent, the Issuing Bank or the Borrower, to confirm that it will comply with the terms of this Agreement relating to its obligations to fund prospective Loans or Incremental Loans and participations in then outstanding Letters of Credit, (d) has otherwise failed to pay over to the Administrative Agent, the Issuing Bank or any other Lender any other amount required to be paid by it hereunder within one Business Day of the date when due, unless such payment is the subject of a good faith dispute, or (e) in the case of a Lender that has a Commitment or LC Exposure outstanding at such time, shall have, or shall be the Subsidiary of any person that shall have, (i) taken any action or been the subject of any action or proceeding of a type described in Section 8.01(g) or Section 8.01(h) (or any comparable proceeding initiated by a regulatory authority having jurisdiction over such Lender or such person) or (ii) become the subject of a
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Bail-In Action. For the avoidance of doubt, a Lender shall not be deemed to be a Defaulting Lender solely by virtue of (i) the ownership or acquisition of any Equity Interest in such Lender or its parent by a Governmental Authority, unless such ownership interest results in or provides such person with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such person (or such governmental authority or instrumentality) to reject, repudiate, disavow or disaffirm any contracts or agreements made by such person or its parent entity or (ii) such Lender becoming subject to an Undisclosed Administration.
Designated Noncash Consideration shall mean, as of any date of determination, the fair market value at the time received (as determined in good faith by the Borrower) of any non-cash consideration received by Holdings or a Restricted Subsidiary in connection with an Asset Sale that is designated in writing as Designated Noncash Consideration, less the amount of cash or Cash Equivalents received in connection with a subsequent payment, redemption, retirement, sale or other disposition of such Designated Noncash Consideration. A particular item of Designated Noncash Consideration will no longer be considered to be outstanding when and to the extent it has been paid, redeemed or otherwise retired or sold or otherwise disposed of in compliance with Section 6.05.
Disqualified Capital Stock shall mean any Equity Interest which, by its terms (or by the terms of any security or any other Equity Interests into which it is convertible or for which it is exchangeable) or upon the happening of any event or condition, would (i) mature or be mandatorily redeemable (other than solely for Qualified Capital Stock) pursuant to a sinking fund obligation or otherwise (except as a result of a customarily defined change of control or asset sale and only so long as any rights of the holders thereof after such change of control or asset sale shall be subject to the prior repayment in full of the Obligations (other than (i) contingent indemnification obligations and unasserted expense reimbursement obligations, (ii) obligations and liabilities under Secured Cash Management Agreements and Secured Hedging Agreements with respect to which arrangements satisfactory to the applicable Cash Management Bank or Hedge Bank shall have been made and (iii) Letters of Credit that have been (x) cash collateralized in accordance with the terms of this Agreement, (y) backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or (z) rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank) and the termination of the Commitments), (ii) be redeemable at the option of the holder thereof (other than solely for Qualified Capital Stock), in whole or in part, (iii) provide for scheduled payments of dividends in cash or (iv) be or become convertible into or exchangeable for Indebtedness or any other Disqualified Capital Stock, in whole or in part, in each case on or prior to the date that is 91 days after the Latest Maturity Date at the time of issuance.
Disqualified Institutions shall mean (a) those Persons that are competitors of Holdings and its Subsidiaries to the extent identified by the Borrower or the Sponsor to the Administrative Agent by name in writing from time to time, (b) those banks, financial institutions and other Persons separately identified by name by the Borrower or the Sponsor to the Lead Arrangers in writing on or before October 25, 2017 or (c) in the case of clause (a) or (b), any of their respective Affiliates (other than, in the case of clause (b), Bona Fide Debt Funds) that are (x) readily identifiable as Affiliates on the basis of their name or (y) identified by name by the Borrower (or by the Sponsor, on the Borrowers behalf) to the Administrative Agent in writing from time to time; provided that the foregoing shall not apply retroactively to disqualify any parties that have previously acquired an assignment or participation interest in the Loans to the extent such party was not a Disqualified Institution at the time of the applicable assignment or participation, as the case may be.
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Dividend shall mean, with respect to any person, that such person has declared or paid a dividend or returned any equity capital to the holders of its Equity Interests or authorized or made any other distribution, payment or delivery of property (other than Qualified Capital Stock of such person) or cash to the holders of its Equity Interests as such, or redeemed, retired, purchased or otherwise acquired, directly or indirectly, for consideration any of its Equity Interests outstanding (or any options or warrants issued by such person with respect to its Equity Interests), or set aside or otherwise reserved, directly or indirectly, any funds for any of the foregoing purposes.
Dollars, dollars or shall mean lawful money of the United States.
Domestic Subsidiary shall mean any Subsidiary that is organized under the laws of the United States, any state thereof or the District of Columbia.
Earn-Outs shall mean, with respect to a Permitted Acquisition or any other acquisition of any assets or Property by any Group Member, that portion of the purchase consideration therefor and that portion of all other payments and liabilities (whether payable in cash or by exchange of Equity Interests or of any Property or otherwise), directly or indirectly, payable by any Group Member in exchange for, or as part of, or in connection with, such Permitted Acquisition or such other acquisition, as the case may be, that is deferred for payment to a future time after the consummation of such Permitted Acquisition or such other acquisition, as the case may be, and includes any and all payments representing the purchase price and any assumptions of Indebtedness, Earn-Outs and other agreements to make any payment the amount of which is, or the terms of payment of which are, in any respect subject to or contingent upon the revenues, income, cash flow or profits (or the like) of any person or business.
ECF Payment Amount shall have the meaning assigned to such term in Section 2.10(f).
EEA Financial Institution shall mean (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.
EEA Member Country shall mean any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
EEA Resolution Authority shall mean any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
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Effective Yield shall mean, as of any date of determination, the sum of (i) the higher of (A) the Adjusted LIBO Rate (or comparable rate under any other applicable facility) on such date for a deposit in dollars with a maturity of three months and (B) the Adjusted LIBO Rate (or comparable rate under any other applicable facility) floor, if any, with respect thereto as of such date, (ii) the interest rate margins as of such date (with such interest rate margin and interest spreads to be determined by reference to the Adjusted LIBO Rate (or comparable rate under any other applicable facility)) and (iii) the amount of original issue discount and/or upfront fees paid and payable (which shall be deemed to constitute like amounts of original issue discount) by the Borrower to the Lenders in connection with the applicable facility (with original issue discount or upfront fees being equated to interest based on assumed four-year life to maturity (or, if less, the remaining life to maturity) and assuming that the applicable revolving commitments (including the initial Revolving Commitments, if applicable) were fully drawn) (it being understood that customary arrangement, commitment, structuring, underwriting, ticking, unused line and amendment fees paid or payable to any of the applicable arrangers (or their respective affiliates) in their respective capacities as such in connection with the applicable facility, as applicable (whether or not such fees are paid to or shared in whole or in part with any lenders thereunder), and any other fees that are not generally paid to all lenders (or their respective affiliates) ratably with respect to such loans or such facility and that are paid or payable in connection with such loans or such facility, shall be excluded).
Eligible Assignee shall mean (a) if the assignment does not include the assignment of a Revolving Commitment, (i) any Lender, (ii) an Affiliate of any Lender, (iii) an Approved Fund, (iv) a Sponsor Investor to the extent permitted by Section 10.04(b)(v), (v) Affiliated Debt Funds, and (vi) any other person approved by the Administrative Agent and the Borrower (each such consent not to be unreasonably withheld or delayed; it being understood that the Borrower prohibiting assignments to Disqualified Institutions is reasonable) and (b) if the assignment includes the assignment of a Revolving Commitment, (i) any Revolving Lender, (ii) an Affiliate of any Revolving Lender, (iii) an Approved Fund with respect to a Revolving Lender and (iv) any other person approved by the Administrative Agent, the Issuing Bank, the Swing Line Lender and the Borrower (each such consent not to be unreasonably withheld or delayed; it being understood that the Borrower prohibiting assignments to Disqualified Institutions is reasonable); provided that, in the case of the foregoing clauses (a) and (b), (1) no approval of the Borrower (other than with respect to Disqualified Institutions) shall be required (A) in connection with the assignment of any Term Loan or any Term Loan Commitment (but, for the avoidance of doubt, such approval shall be required in connection with any such assignment of a Revolving Commitment or a Revolving Loan) during the continuance of a Default or Event of Default under Section 8.01(a), (b), (g) with respect to the Borrower or (h) with respect to the Borrower or (B) in connection with the primary syndication of the Revolving Commitments and Term Loans to persons (or any Affiliate or Approved Fund thereof) which the Borrower has previously consented to in writing (including by email), (2) to the extent the consent of the Borrower is required for any assignment, such consent shall be deemed to have been given (except with respect to Disqualified Institutions) if the Borrower has not responded within ten Business Days of a written request for such consent, (3) no approval of the Borrower shall be required with respect to any assignment of Term Loans to another Lender, an Affiliate of any Lender or an Approved Fund, (4) no approval of the Borrower shall be required with respect to any assignment of a Revolving Commitment to another Revolving Lender, an Affiliate of any Revolving Lender or an Approved Fund with respect to a Revolving Lender and (5) notwithstanding anything to the contrary herein, Eligible Assignee shall not include at any time any Disqualified Institutions (unless consented to in writing by the Borrower in its sole discretion), any Defaulting Lender, or any natural person.
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Eligible Equity Issuance shall mean an issuance and sale of Qualified Capital Stock of Holdings following the Closing Date (other than to the extent applied or to be applied as a Cure Amount) to the equity holders of Holdings.
Employee Benefit Plan shall mean each employee benefit plan (as such term is defined in Section 3(3) of ERISA) that is maintained or contributed to by a Group Member or with respect to which a Group Member has any liability (including on account of an ERISA Affiliate).
Environment shall mean ambient air, surface water and groundwater (including potable water, navigable water and wetlands) and the land surface.
Environmental Claim shall mean any claim, notice, demand, order, action, suit or proceeding relating to any investigation, remediation, removal, cleanup, response, corrective action, penalties or other costs (including damages, natural resources damages, contribution, indemnification, cost recovery, compensation or injunctive relief) resulting from, related to or arising out of (i) the presence, Release or threatened Release of Hazardous Material, (ii) any violation or alleged violation of any Environmental Law, or (iii) any actual or alleged exposure to Hazardous Materials.
Environmental Law shall mean all applicable Requirements of Law relating to pollution or protection of the Environment, or to Hazardous Materials.
Environmental Permit shall mean any permit, license, approval, registration, consent or other authorization required by or from a Governmental Authority under Environmental Law.
Equity Cure Contribution shall have the meaning assigned to such term in Section 8.03(a).
Equity Funded Portion shall mean an amount equal to (i) the working capital or other purchase price adjustment with respect to any acquisition or other Investment times (ii) the percentage of the consideration for such acquisition or other Investment that is financed solely with the proceeds of equity issuances by and equity contributions to Holdings, but solely to the extent such equity issuance or equity contribution, as applicable, does not otherwise increase Indebtedness, Investment, Dividend or Restricted Debt Payment capacity hereunder, including, without limitation, pursuant to an increase in the Cumulative Amount.
Equity Interest shall mean, with respect to any person, any and all shares, interests, participations or other equivalents, including membership interests (however designated, whether voting or nonvoting), of equity of such person, including warrants, options and other rights to purchase and including, if such person is a limited liability company, membership interests or if such person is a partnership, partnership interests (whether general or limited) and any other interest or participation that confers on a person the right to receive a share of the profits and losses of, or distributions of property of, such partnership, whether outstanding on the date hereof or issued after the Closing Date; provided that Equity Interest shall not include at any time (i) debt securities convertible or exchangeable into such equity or (ii) earn-outs.
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Equity Investors shall mean the Sponsor and its Controlled Investment Affiliates and limited partners.
Equity Issuance shall mean, without duplication, (a) any issuance or sale by Holdings of any Equity Interests in Holdings (including any Equity Interests issued upon the exercise of any warrant or option or equity-based derivative) or any warrants or options or equity-based derivatives to purchase Equity Interests of Holdings or (b) any contribution to the capital of Holdings.
ERISA shall mean the Employee Retirement Income Security Act of 1974, as the same may be amended from time to time.
ERISA Affiliate shall mean, with respect to any person, any trade or business (whether or not incorporated) that, together with such person, is treated as a single employer under Section 414(b) or (c) of the Code or, solely for purposes of Section 412 of the Code, Section 414(m) or (o) of the Code.
ERISA Event shall mean (a) any reportable event, as defined in Section 4043(c) of ERISA or the regulations issued thereunder, with respect to a Plan (other than an event for which the 30-day notice period is waived by regulation); (b) with respect to a Plan, the failure to satisfy the minimum funding standard of Section 412 or 430 of the Code and Section 302 or 303 of ERISA, whether or not waived; (c) the failure to make by its due date a required installment under Section 430(j) of the Code with respect to any Plan or the failure to make any required contribution to a Multiemployer Plan; (d) the determination that any Plan is, or is expected to be, in at risk status (as defined in Section 430 of the Code or Section 303 of ERISA); (e) the incurrence by any Group Member or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (f) the receipt by any Group Member or any of its ERISA Affiliates from the PBGC or a plan administrator of any notice relating to the intention to terminate any Plan or Plans or Multiemployer Plan or Multiemployer Plans or to appoint a trustee to administer any Plan or Multiemployer Plan, or the occurrence of any event or condition which would reasonably be expected to constitute grounds under ERISA for the termination of, or the appointment of a trustee to administer, any Plan or Multiemployer Plan; (g) the incurrence by any Group Member or its ERISA Affiliates of liability resulting from the complete or partial withdrawal from any Multiemployer Plan; (h) the receipt by any Group Member or its ERISA Affiliates of any notice, concerning a determination that a Multiemployer Plan is, or is reasonably expected to be, insolvent (within the meaning of Section 4245 of ERISA) or in critical or endangered status, under Section 432 of the Code or Section 305 of ERISA; (i) the withdrawal of any Group Member or its ERISA Affiliates from a Plan subject to Section 4063 of ERISA during a plan year in which such entity was a substantial employer as defined in Section 4001(a)(2) of ERISA or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (j) the occurrence of a non-exempt prohibited transaction (within the meaning of Section 4975 of the Code or Section 406 of ERISA) which would reasonably be expected to result in liability to any Group Member; or (k) a Foreign Benefit Event.
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EU Bail-In Legislation Schedule means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.
Eurodollar Borrowing shall mean a Borrowing comprised of Eurodollar Loans.
Eurodollar Loan shall mean any Eurodollar Revolving Loan or Eurodollar Term Loan.
Eurodollar Revolving Borrowing shall mean a Borrowing comprised of Eurodollar Revolving Loans.
Eurodollar Revolving Loan shall mean any Revolving Loan bearing interest at a rate determined by reference to the Adjusted LIBO Rate in accordance with the provisions of Article II.
Eurodollar Term Loan shall mean any Term Loan bearing interest at a rate determined by reference to the Adjusted LIBO Rate in accordance with the provisions of Article II
Event of Default shall have the meaning assigned to such term in Section 8.01.
Excess Amount shall have the meaning assigned to such term in Section 2.10(h).
Excess Cash Flow shall mean, for any Excess Cash Flow Period, Consolidated EBITDA for such Excess Cash Flow Period, minus, without duplication:
(a) Debt Service and other payments of Indebtedness (including, without limitation, related fees and expenses, to the extent paid in cash and to the extent such payments are permitted hereunder, but excluding (A) any required cash payments of principal with respect to the Loans under this Agreement (excluding amortization payments of Term Loans), and (B) voluntary prepayments of Loans pursuant to Section 2.10(a)) of Holdings and its Restricted Subsidiaries, in each case, to the extent made from sources other than the proceeds of long-term Indebtedness (other than revolving Indebtedness to the extent intended to be repaid from operating cash flow); provided that, in each case, payments of revolving Indebtedness shall not be deducted from Excess Cash Flow pursuant to this clause (a) unless accompanied by a permanent reduction in the relevant commitment;
(b) Capital Expenditures made from sources other than the proceeds of longterm Indebtedness (other than revolving Indebtedness to the extent intended to be repaid from operating cash flow) (excluding Capital Expenditures made in such Excess Cash Flow Period and subject to the second parenthetical of the following clause (c) with respect to the immediately preceding Excess Cash Flow Period was previously delivered) that are paid in cash;
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(c) Capital Expenditures made from sources other than the proceeds of longterm Indebtedness (other than revolving Indebtedness to the extent intended to be repaid from operating cash flow) that Holdings or any of its Restricted Subsidiaries shall, during such Excess Cash Flow Period, become obligated to make but that are not made during such Excess Cash Flow Period (limited to those committed to be made within the next six months after the end of such Excess Cash Flow Period);
(d) the aggregate amount of payments made in cash (and made from sources other than the proceeds of long-term Indebtedness (other than revolving Indebtedness to the extent intended to be repaid from operating cash flow)) during such Excess Cash Flow Period (or committed to be paid in cash within the next six months after the end of such Excess Cash Flow Period) (other than Capital Expenditures) and capitalized or otherwise not expensed in accordance with GAAP during such Excess Cash Flow Period;
(e) the aggregate amount of Consolidated Tax Expense (including any direct or indirect distributions for the payment of such Consolidated Tax Expense) paid or payable with respect to such Excess Cash Flow Period and, if payable, for which reserves have been established to the extent required under GAAP;
(f) (x) the aggregate amount of consideration paid in cash during such Excess Cash Flow Period (or committed to be paid in cash within the next six months after the end of such Excess Cash Flow Period) with respect to Permitted Acquisitions or other Investments made from sources other than the proceeds of long-term Indebtedness (other than revolving Indebtedness to the extent intended to be repaid from operating cash flow) (including, without limitation, any purchase price adjustments (including working capital adjustments), deferred purchase consideration, Earn-Out payments (and payments of seller notes converted from Earn- Outs), holdback amounts and indemnity payments with respect thereto) but excluding intercompany Investments and Investments in cash or Cash Equivalents, to the extent paid in cash and (y) to the extent not deducted in determining Consolidated Net Income for such period, any amounts paid by Holdings and its Restricted Subsidiaries during such period that are reimbursable by the seller, or other unrelated third party, in connection with a Permitted Acquisition or other Investment permitted under Section 6.03(a), (b), (i), (1), (m), (r), (t), (v), (w), (x) (to the extent made in reliance on clause (a) of the definition of Cumulative Amount), (y), (bb), (cc), (ee) or (ff);
(g) the absolute value of, if negative, (x) the amount of Net Working Capital at the end of the prior Excess Cash Flow Period (or the beginning of the Excess Cash Flow Period in the case of the first Excess Cash Flow Period) minus (y) the amount of Net Working Capital at the end of such Excess Cash Flow Period;
(h) the aggregate amount of cash items added back to Consolidated EBITDA in the calculation of Consolidated EBITDA for such period to the extent paid in cash by Holdings and its Restricted Subsidiaries during such period;
(i) [reserved];
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(j) the aggregate amount added back to Consolidated EBITDA in the calculation of Consolidated EBITDA for such period pursuant to clauses (f) and (r) thereof;
(k) any Insurance Loss Addback for such period;
(l) the aggregate amount of non-cash adjustments to Consolidated EBITDA for periods prior to the beginning of the current Excess Cash Flow Period to the extent paid in cash by Holdings and its Restricted Subsidiaries during such Excess Cash Flow Period;
(m) the aggregate amount of Dividends and other payments made from sources other than the proceeds of long-term Indebtedness (other than revolving Indebtedness to the extent intended to be repaid from operating cash flow) permitted by Section 6.06 (other than clauses (a), (f) (solely to the extent any such Dividend thereunder is made in reliance on clause (b) of the Cumulative Amount) (g) and (i) of Section 6.06) during such Excess Cash Flow Period (or committed to be paid in cash within the next six months after the end of such Excess Cash Flow Period); and
(n) to the extent added to determine Consolidated EBITDA pursuant to clause (i) or (1) of the definition of Consolidated EBITDA, such amounts with respect to which no cash payment to Holdings or any of its Restricted Subsidiaries was received during such Excess Cash Flow Period;
provided that any amount deducted pursuant to any of the foregoing clauses that will be paid after the close of such Excess Cash Flow Period shall not be deducted again in a subsequent Excess Cash Flow Period; plus, without duplication:
(i) if positive, (x) the amount of Net Working Capital at the end of the prior Excess Cash Flow Period (or the beginning of the Excess Cash Flow Period in the case of the first Excess Cash Flow Period) minus (y) the amount of Net Working Capital at the end of such Excess Cash Flow Period;
(ii) cash items of income during such Excess Cash Flow Period not included in calculating Consolidated EBITDA;
(iii) any permitted Capital Expenditures referred to in clause (c) above or permitted payments in cash referred to above in clause (d), (f) or (m) that are committed to be made within the next six months after the end of such Excess Cash Flow Period, to the extent not so made during such six month period;
(iv) any cash payment that was actually received by Holdings or any Restricted Subsidiary during such Excess Cash Flow Period with respect to which a deduction was taken pursuant to clause (n) above during the previous Excess Cash Flow Period; and
(v) any reimbursement that was actually received in cash by Holdings or any of its Restricted Subsidiaries from a seller, or other unrelated third party, in connection with a Permitted Acquisition or other Investment permitted under Section 6.03(a), (b), (i), (1), (m), (r), (t), (v), (w), (x) (to the extent made in reliance on clause (a) of the definition of Cumulative Amount), (y), (bb), (cc), (ee) or (ff) during such Excess Cash Flow Period with respect to which a deduction was taken pursuant to clause (f)(y) above during the previous Excess Cash Flow Period.
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For purposes of calculating Excess Cash Flow for any Excess Cash Flow Period, for each Permitted Acquisition or other Investment permitted hereunder consummated during such Excess Cash Flow Period, (x) the Consolidated EBITDA of a target of such Permitted Acquisition or other Investment shall be included in such calculation only from and after the first day of the first fiscal quarter to commence following the date of the consummation of such Permitted Acquisition or other Investment and (y) for the purposes of calculating Net Working Capital, the (A) total assets of a target of such Permitted Acquisition or other Investment (other than cash and Cash Equivalents), as calculated as at the date of consummation of the applicable Permitted Acquisition or other Investment, which may properly be classified as current assets on a consolidated balance sheet of Holdings and its Restricted Subsidiaries in accordance with GAAP (assuming, for the purpose of this clause (A), that such Permitted Acquisition or other similar acquisition has been consummated) and (B) the total liabilities of Holdings and its Restricted Subsidiaries, as calculated as at the date of consummation of the applicable Permitted Acquisition or other Investment, which may properly be classified as current liabilities (other than the current portion of any long term liabilities and accrued interest thereon) on a consolidated balance sheet of Holdings and its Restricted Subsidiaries in accordance with GAAP (assuming, for the purpose of this clause (B), that such Permitted Acquisition or Investment has been consummated), shall, in the case of both immediately preceding clauses (A) and (B), be used in calculating as the difference between the Net Working Capital at the end of the applicable Excess Cash Flow Period from the date of consummation of the Permitted Acquisition or other Investment.
Excess Cash Flow Period shall mean each fiscal year of Holdings starting with the fiscal year ending December 31, 2018.
Excess Net Cash Proceeds shall have the meaning assigned to such term in Section 2.10(c)(i).
Exchange Act shall mean the Securities Exchange Act of 1934, as amended.
Excluded Equity Interests shall mean Equity Interests (a) in excess of 65% of the Voting Stock issued by any Excluded Foreign Subsidiary or CFC Holding Company, in each case, owned directly by a Credit Party (but, for the avoidance of doubt, not including any Equity interests that are not Voting Stock issued by any such Excluded Foreign Subsidiary or CFC Holding Company), (b) in a joint venture which cannot be pledged without the consent of third parties, or the pledge of which is prohibited by the terms of, or would create a right of termination of one or more third parties under, any applicable Organizational Documents, joint venture agreement or shareholders agreement (by any agreement binding on such Equity Interests at the time of acquisition thereof (or on the Closing Date, as applicable) and not entered into in contemplation thereof (or in contemplation of the Transactions, as applicable) and unless such consent has been obtained) after giving effect to the applicable anti-assignment provisions of the Uniform Commercial Code or other applicable law, (c) in Persons other than Wholly Owned Restricted Subsidiaries, (d) in any Immaterial Subsidiary, Unrestricted Subsidiary, not-
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for-profit Subsidiary, captive insurance entity or special purpose entity (including for the avoidance of doubt any Receivables Subsidiary and any Securitization Subsidiary), (e) with respect to which the cost of obtaining a security interest therein exceeds the practical benefit to the Lenders afforded thereby, as mutually and reasonably determined by the Administrative Agent and the Borrower, (f) with respect to which a pledge therein is prohibited or restricted by applicable law (including any requirement to obtain the consent of any governmental authority (unless such consent has been obtained) or third party (by any agreement binding on such Equity Interests at the time of acquisition thereof (or on the Closing Date, as applicable) and not entered into in contemplation thereof (or in contemplation of the Transactions, as applicable) and unless such consent has been obtained)) or impossible or impracticable (as mutually and reasonably determined by the Administrative Agent and the Borrower) to obtain under applicable law and (g) with respect to which a pledge therein would result in adverse tax consequences to Holdings and its Restricted Subsidiaries or to any direct or indirect parent of Holdings on account of its direct or indirect ownership of Holdings and its Restricted Subsidiaries that are not de minimis as reasonably determined by the Borrower; provided that in each case set forth above, such equity will immediately cease to constitute Excluded Equity Interests when the relevant property ceases to meet this definition and, with respect to any such equity, a security interest under any applicable Security Document shall attach immediately and automatically without further action; provided, further, that in no event will any Equity Interests of the Borrower or Lanyon be Excluded Equity Interests.
Excluded Foreign Subsidiary shall mean any Foreign Subsidiary that is a CFC and any Subsidiary of such CFC.
Excluded Property shall have the meaning assigned to such term in the Security Agreement.
Excluded Subsidiary shall mean (a) any Restricted Subsidiary that is not a Wholly Owned Subsidiary, (b) any Excluded Foreign Subsidiary, (c) any Immaterial Subsidiary, (d) any Unrestricted Subsidiary, (e) any not-for-profit Subsidiary, (f) any Excluded U.S. Subsidiary, (g) any captive insurance entity, (h) any special purpose entity (including, for the avoidance of doubt, any Receivables Subsidiary and any Securitization Subsidiary), (i) any merger Subsidiary formed in connection with a Permitted Acquisition so long as such merger Subsidiary is merged out of existence pursuant to such Permitted Acquisition within 60 days of its formation or such later date as permitted by the Administrative Agent in its reasonable discretion, (j) any Subsidiary to the extent a Guarantee or other guarantee of the Obligations is prohibited or restricted by any contractual obligation as in existence on the Closing Date or at the time such Person becomes a Subsidiary (in each case, not entered into in contemplation hereof and for so long as such prohibition or restriction remains in effect) or by applicable Requirements of Law (including any requirement to obtain Governmental Authority or third party consent, license or authorization unless such consent, license or authorization has been obtained), (k) any Restricted Subsidiary acquired pursuant to a Permitted Acquisition or other Investment that has assumed secured Indebtedness not incurred in contemplation of such Permitted Acquisition or other Investment and any Restricted Subsidiary thereof that guarantees such secured Indebtedness, in each case, to the extent (but only for so long as) such secured Indebtedness prohibits such Restricted Subsidiary from becoming a Guarantor, (1) any Subsidiary to the extent the Administrative Agent and the Borrower mutually and reasonably
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determine the cost, consequence and/or burden of obtaining a Guarantee outweigh the benefit thereof to the Lenders, and (m) any Subsidiary to the extent the Borrower reasonably determines that a Guarantee by such Subsidiary would result in adverse Tax consequences to Holdings or any of its Restricted Subsidiaries or to any direct or indirect parent of Holdings on account of its direct or indirect ownership of Holdings and its Restricted Subsidiaries that are not de minimis, provided that neither the Borrower nor Lanyon shall be an Excluded Subsidiary; provided further that Borrower may, in its sole discretion, designate any Subsidiary that otherwise qualifies as an Excluded Subsidiary pursuant to any one or more of clauses (a) through (m) above as not being an Excluded Subsidiary by written notice to the Administrative Agent and, following such designation, may (so long as at such time no Default or Event of Default shall have occurred and be continuing and such Subsidiary otherwise qualifies as an Excluded Subsidiary) re-designate such Subsidiary as an Excluded Subsidiary by written notice to the Administrative Agent, upon which re-designation such Subsidiary shall be automatically released from its Guarantee.
Excluded Swap Obligation shall mean, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guarantee of such Guarantor of, or the grant by such Guarantor of a security interest pursuant to the Security Documents to secure, such Swap Obligation (or any guarantee thereof) is or would otherwise have become illegal or unlawful under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantors failure for any reason to constitute an eligible contract participant as defined in the Commodity Exchange Act and the regulations thereunder at the time the Guarantee of such Guarantor or the grant of such security interest would otherwise have become effective with respect to such related Swap Obligation but for such Guarantors failure to constitute an eligible contract participant at such time. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guarantee or security interest is or becomes illegal or unlawful under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof).
Excluded Taxes shall mean, with respect to any Recipient, any of the following Taxes imposed on or with respect to any payment to be made by or on account of any obligation of any Credit Party under any Loan Document to such Recipient: (a) Taxes imposed on or measured by such Recipients overall net income (however denominated), franchise Taxes imposed on it (in lieu of net income Taxes) and branch profits Taxes imposed on it, in each case, (i) by any jurisdiction (or any political subdivision thereof) as a result of the Recipient being organized or having its principal office or, in the case of any Lender, its applicable lending office, in such jurisdiction or (ii) as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document or sold or assigned an interest in any Loan or Loan Document), (b) in the case of a Foreign Lender, any U.S. federal withholding Tax to the extent imposed on amounts payable to or for the account of such Foreign Lender under a law, rule, regulation or treaty in effect at the time such Foreign Lender becomes a party hereto (or designates a new lending office), except, in each case, (x) to the extent that such Foreign
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Lender (or its assignor, if any) was entitled, immediately prior to the designation of a new lending office (or assignment), to receive additional amounts or indemnity payments with respect to such withholding Tax pursuant to Section 2.15, or (y) if such Foreign Lender is an assignee pursuant to a request by the Borrower under Section 2.16, (c) any withholding Tax that is attributable to such Recipients failure to comply with Section 2.15(e), and (d) any U.S. federal withholding Tax imposed under FATCA.
Excluded U.S. Subsidiary shall mean (a) any Domestic Subsidiary of an Excluded Foreign Subsidiary or (b) any CFC Holding Company; provided that neither the Borrower nor Lanyon shall be an Excluded U.S. Subsidiary.
Executive Order shall have the meaning assigned to such term in Section 3.19.
Existing First Lien Credit Agreement shall have the meaning assigned to such term in the preamble hereto.
Existing Lien shall have the meaning assigned to such term in Section 6.02(c).
Existing Loans shall have the meaning assigned to such term in Section 2.21(a).
Existing Tranche shall have the meaning assigned to such term in Section 2.21(a).
Exiting First Lien Term Loan Lenders shall mean each Term Loan Lender under and as defined in the Existing First Lien Credit Agreement but which is not a Term Loan Lender hereunder as of the Closing Date.
Extended Loans shall have the meaning assigned to such term in Section 2.21(a).
Extended Tranche shall have the meaning assigned to such term in Section 2.21(a).
Extending Lender shall have the meaning assigned to such term in Section 2.21(b).
Extension Amendment shall have the meaning assigned to such term in Section 2.21(c).
Extension Date shall have the meaning assigned to such term in Section 2.21(d).
Extension Election shall have the meaning assigned to such term in Section 2.21(b).
Extension Request shall have the meaning assigned to such term in Section 2.21(a).
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FATCA shall mean Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version thereof to the extent such version is substantively comparable and not materially more onerous to comply with), any current or future regulations or other official governmental interpretations thereof and any intergovernmental agreements entered into pursuant to the foregoing or any FFI agreements entered into pursuant to Section 1471(b)(1) of the Code.
Federal Funds Rate shall mean, for any day, the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System of the United States, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average (rounded upwards, if necessary to the next 1/100th of 1.00%) of the quotations for the day for such transactions received by the Administrative Agent from three federal funds brokers of recognized standing selected by it.
Fee Letters shall mean each of (a) the Amended and Restated Fee Letter dated as of November 30, 2017, by and between Cvent and GS and (b) those certain fee letters dated as of November 2, 2017 among Cvent and each of Antares Capital LP, Jefferies Finance LLC and Royal Bank of Canada, respectively.
Fees shall mean the Commitment Fees, the Administrative Agent Fees, the LC Participation Fees, the Fronting Fees and all other fees set forth in Section 2.05.
Financial Covenant shall have the meaning assigned to such term in Section 8.03(a).
Financial Officer of any person shall mean the chief financial officer, chief executive officer, vice president of finance, treasurer, assistant treasurer, controller, or, in each case, anyone acting in such capacity or any similar capacity.
Financial Statements shall mean, collectively, (a) the Audited Financial Statements and (b) unaudited consolidated balance sheets and related unaudited statements of income, stockholders equity and cash flows of Holdings and its Subsidiaries for each fiscal quarter of Holdings (other than the fourth fiscal quarter of any fiscal year) ended after the date of the most recently delivered Audited Financial Statements and at least 60 days prior to the Closing Date.
First Lien Leverage Ratio shall mean, at any date of determination, the ratio of (i)(x) Consolidated Total Funded Indebtedness of Holdings and its Restricted Subsidiaries on such date that is secured by a first priority Lien on the Collateral of Holdings and its Restricted Subsidiaries, minus (y) Unrestricted Cash of Holdings and its Restricted Subsidiaries on such date, to (ii) Consolidated EBITDA for the Test Period then most recently ended.
First Lien/Second Lien Intercreditor Agreement shall mean a First Lien/Second Lien Intercreditor Agreement among the Administrative Agent, the Collateral Agent and one or more other Senior Representatives of Indebtedness, or any other party, as the case may be, and acknowledged and agreed to by the Borrower and the Guarantors, substantially on the terms set forth on Exhibit I (except to the extent otherwise reasonably agreed by the Borrower and the Administrative Agent), as the same may be amended, restated, supplemented, renewed, replaced or otherwise modified from time to time.
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Fixed Incremental Amount shall have the meaning assigned to such term in the definition of Maximum Incremental Facilities Amount.
Flood Insurance Laws shall mean, collectively, (i) the National Flood Insurance Act of 1968 as now or hereafter in effect or any successor statute thereto, (ii) the Flood Disaster Protection Act of 1973 as now or hereafter in effect or any successor statute thereto, (iii) the National Flood Insurance Reform Act of 1994 as now or hereafter in effect or any successor statute thereto and (iv) the Flood Insurance Reform Act of 2004 as now or hereafter in effect or any successor statute thereto.
Foreign Benefit Event shall mean, with respect to any Foreign Pension Plan, (a) the existence of unfunded liabilities in excess of the amount permitted under any applicable law, or in excess of the amount that would be permitted absent a waiver from a Governmental Authority, (b) the failure to make the required contributions or payments, under any applicable law, on or before the due date for such contributions or payments, (c) the receipt of a notice by a Governmental Authority relating to the intention to terminate any such Foreign Pension Plan or to appoint a trustee or similar official to administer any such Foreign Pension Plan, or alleging the insolvency of any such Foreign Pension Plan, (d) the incurrence of any liability by any Group Member under applicable law on account of the complete or partial termination of such Foreign Pension Plan or the complete or partial withdrawal of any participating employer therein, or (e) the occurrence of any transaction that is prohibited under any applicable law and that could reasonably be expected to result in the incurrence of any liability by any Group Member, or the imposition on any Group Member of any fine, excise tax or penalty resulting from any noncompliance with any applicable law.
Foreign Lender shall mean any Recipient that is not a United States person as defined in Section 7701(a)(30) of the Code.
Foreign Pension Plan shall mean any defined benefit pension plan maintained or contributed to by any Group Member with respect to employees employed outside the United States.
Foreign Plan shall mean any employee benefit plan, program, policy, arrangement or agreement maintained or contributed to by any Group Member with respect to employees employed outside the United States.
Foreign Subsidiary shall mean a Subsidiary that is organized under the laws of a jurisdiction other than the United States, any state thereof or the District of Columbia.
Fronting Fee shall have the meaning assigned to such term in Section 2.05(d).
Fund shall mean any person that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business.
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GAAP shall mean generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board, applied on a consistent basis.
Governmental Authority shall mean the government of the United States or any other nation, or of any political subdivision thereof, whether state, provincial, local or otherwise, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).
Group Members shall mean Holdings, the Borrower and their respective Restricted Subsidiaries; and Group Member shall mean any one of them.
GS shall mean Goldman Sachs Bank USA.
Guaranteed Obligations shall have the meaning assigned to such term in Section 7.01.
Guarantees shall mean the guarantees issued pursuant to Article VII by Holdings and the Subsidiary Guarantors.
Guarantors shall mean Holdings and each of the Subsidiary Guarantors.
Hazardous Materials shall mean the following: toxic or hazardous substances; hazardous wastes; polychlorinated biphenyls (PCBs) or any substance or compound containing PCBs; friable asbestos or friable asbestos-containing materials; radon or any other radioactive materials including any source, special nuclear or by-product material; petroleum, crude oil or any fraction thereof; and any other pollutant or contaminant subject to regulation under any Environmental Laws due to their dangerous or deleterious properties or characteristics, or which can give rise to liability under any Environmental Laws due to their dangerous or deleterious properties or characteristics.
Hedge Bank shall mean, in respect of any Hedging Agreement, each counterparty to a Hedging Agreement that is a Lender, an Agent or a Lead Arranger (or an Affiliate of a Lender, an Agent or a Lead Arranger) and each other Person if, at the date of entering into such Hedging Agreement, such Person was a Lender, an Agent or a Lead Arranger (or an Affiliate of a Lender, an Agent or a Lead Arranger); provided that if such Person ceases to be a Lender, an Agent or a Lead Arranger, such Person delivers to the Administrative Agent a letter agreement to the Administrative Agent pursuant to which such Person (i) appoints the Collateral Agent as its agent under the applicable Loan Documents and (ii) agrees to be bound by the provisions of Sections 9,03, 10,03 and 10.09 as if it were a Lender.
Hedging Agreement shall mean any swap, cap, collar, forward purchase or similar agreement or arrangement dealing with interest rates, currency exchange rates or commodity prices, either generally or under specific contingencies.
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Hedging Obligations shall mean obligations under or with respect to Hedging Agreements.
Holdings shall have the meaning assigned to such term in the preamble hereof.
Immaterial Subsidiary shall mean any Restricted Subsidiary of Holdings (other than the Borrower or Lanyon) that the Borrower designates in writing (including via e- mail) to the Administrative Agent as an Immaterial Subsidiary; provided that, as of the date of the last financial statements delivered pursuant to Section 5.01(a) or Section 5.01(b), neither (a) the Consolidated Total Assets attributable to all such Subsidiaries is in excess of 5% of Consolidated Total Assets as of such date nor (b) the total revenues attributable to all such Subsidiaries is in excess of 5% of total revenues of the Group Members on a consolidated basis as of such date; provided, further, that in each case, the Borrower may designate and re-designate a Subsidiary as an Immaterial Subsidiary at any time, subject to the limitations and requirements set forth in this definition. If the Consolidated Total Assets or total revenues attributable to all Restricted Subsidiaries so designated by the Borrower as Immaterial Subsidiaries shall at any time exceed the limits set forth in the preceding sentence, then starting with the largest Restricted Subsidiary (or in such other order as the Borrower may elect in its sole discretion), the number of Restricted Subsidiaries that are at such time designated as Immaterial Subsidiaries shall automatically be deemed to no longer be designated as Immaterial Subsidiaries until the threshold amounts in the preceding sentence are no longer exceeded (as reasonably determined by the Borrower), with any Immaterial Subsidiaries at such time that are below such threshold amounts still being designated as (and remaining as) Immaterial Subsidiaries.
Increase Effective Date shall have the meaning assigned to such term in Section 2.20(a).
Increase Joinder shall have the meaning assigned to such term in Section 2.20(e).
Incremental Facilities shall have the meaning assigned to such term in Section 2.20(a).
Incremental Reclassification Provision shall have the meaning assigned to such term in the definition of Maximum Incremental Facilities Amount.
Incremental Revolving Loan shall have the meaning assigned to such term in Section 2.20(c)(iii).
Incremental Revolving Loan Commitment shall have the meaning assigned to such term in Section 2.20(a).
Incremental Revolving Loan Lender shall mean a Lender with an Incremental Revolving Loan Commitment or an outstanding Incremental Revolving Loan.
Incremental Term Loan Commitment shall have the meaning assigned to such term in Section 2.20(a).
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Incremental Term Loan Lender shall mean a Lender with an Incremental Term Loan Commitment or an outstanding Incremental Term Loan.
Incremental Term Loans shall have the meaning assigned to such term in Section 2.20(c)(i).
Incurrence Ratio shall have the meaning assigned to such term in the definition of Maximum Incremental Facilities Amount.
Indebtedness of any person shall mean, without duplication, (a) all obligations of such person for borrowed money or advances; (b) all obligations of such person evidenced by bonds, debentures, notes or similar instruments; (c) all obligations of such person under conditional sale or other title retention agreements relating to property purchased by such person; (d) all obligations of such person issued or assumed as the deferred purchase price of property or services; (e) all Indebtedness of others (excluding prepaid interest thereon) secured by any Lien on property owned or acquired by such person, whether or not the obligations secured thereby have been assumed, but limited to the lower of (x) fair market value of such property as determined by such person in good faith and (y) the amount of Indebtedness secured by such Lien; (f) all Capital Lease Obligations, Purchase Money Obligations and synthetic lease obligations of such person to the extent classified as indebtedness under GAAP (for the avoidance of doubt, lease payments under any operating leases (other than Capital Leases recorded as capitalized leases in accordance with GAAP as in effect on the Closing Date) shall not constitute Indebtedness); (g) all Hedging Obligations to the extent required to be reflected on the balance sheet of such person on a marked to market net value basis (or if any actual amount is due as a result of the termination or close out of such Hedging Agreement, such actual amount); (h) all Attributable Indebtedness of such person; (i) all obligations of such person for the reimbursement of any obligor in respect of letters of credit, letters of guaranty, bankers acceptances and similar credit transactions; and (j) all Contingent Obligations of such person in respect of Indebtedness or obligations of others of the kinds referred to in clauses (a) through (i) above. The Indebtedness of any person shall include the Indebtedness of any other entity (including any partnership in which such person is a general partner) to the extent such person is liable therefor as a result of such persons ownership interest in or other relationship with such entity, except (other than in the case of general partner liability) to the extent that terms of such Indebtedness expressly provide that such person is not liable therefor. Notwithstanding the foregoing or anything else herein to the contrary, Indebtedness shall not include: (a) trade accounts payable, (b) deferred obligations under any management services agreement (including the Management Services Agreement), (c) accrued obligations incurred in the ordinary course of business, including current tax accruals, (d) purchase price adjustments and Earn-Out obligations (until such obligations or adjustments become a liability on the balance sheet of such Person in accordance with GAAP and solely if not paid after becoming due and payable), (e) royalty payments made in the ordinary course of business in respect of licenses (to the extent such licenses are not prohibited hereby), (f) any accruals for payroll and other noninterest bearing liabilities accrued in the ordinary course of business, (g) deferred rent obligations, taxes and compensation, (h) obligations under or in respect of Receivables Facilities and Securitization Facilities, (i) customary payables with respect to money orders or wire transfers, (j) customary obligations under employment arrangements, (k) operating leases (including for the avoidance of doubt any lease, concession or license treated as an operating lease under GAAP), (1) pension-related or post-employment liabilities, (m) intra-day exposures, (n) Hedging Obligations except to the extent included in clause (g) above or (o) obligations in respect of any license, permit or other approval arising in the ordinary course of business.
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Indemnified Taxes shall mean (a) all Taxes imposed on or with respect to any payment made by or on account of any obligation of any Credit Party under any Loan Document other than Excluded Taxes and (b) to the extent not otherwise described in clause (a), Other Taxes.
Indemnitee shall have the meaning assigned to such term in Section 10.03(b).
Information shall have the meaning assigned to such term in Section 10,12.
Insurance Loss Addback shall mean, with respect to any calculation period, the amount of any loss, costs or expenses incurred during such period for which there is insurance, indemnity or reimbursement coverage and for which a related insurance, indemnity or reimbursement recovery is not recorded in accordance with GAAP, but for which such insurance, indemnity or reimbursement recovery is reasonably expected to be received by Holdings or any of its Restricted Subsidiaries in a subsequent calculation period and within one year of the date of the underlying loss.
Intellectual Property shall have the meaning assigned to such term in the Security Agreement.
Intercompany Subordination Agreement shall mean an intercompany subordination agreement in form and substance reasonably acceptable to the Administrative Agent and the Borrower.
Intercreditor Agreement shall mean, as the context may require, a First Lien/Second Lien Intercreditor Agreement and/or any Other Intercreditor Agreement.
Interest Election Request shall mean a request by the Borrower to convert or continue a Revolving Borrowing or Term Loan Borrowing in accordance with Section 2.08(b), substantially in the form of Exhibit E or such other form (including any form on an electronic platform or electronic transmission system) as may be approved by the Administrative Agent, appropriately completed and signed by a Responsible Officer of the Borrower.
Interest Payment Date shall mean (a) with respect to any ABR Loan (including Swing Line Loans), the last Business Day of each March, June, September and December to occur during any period in which such Loan is outstanding, (b) with respect to any Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a Eurodollar Loan with an Interest Period of more than three months duration, each day prior to the last day of such Interest Period that occurs at intervals of three months duration after the first day of such Interest Period, (c) with respect to any Revolving Loan or Swing Line Loan, the Revolving Maturity Date or such earlier date on which the Revolving Commitments are terminated in accordance with the terms hereof, and (d) with respect to any Term Loan, the Term Loan Maturity Date.
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Interest Period shall mean, with respect to any Eurodollar Loan, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one, two, three or six months (or, if agreed to by all relevant affected Lenders, twelve months or shorter than one month) thereafter, as the Borrower may elect; provided that (a) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, (b) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period and (c) no Interest Period shall extend beyond (i) in the case of any Eurodollar Revolving Loan, the Revolving Maturity Date, and (ii) in the case of any Eurodollar Term Loan, the Term Loan Maturity Date. For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.
Investments shall have the meaning assigned to such term in Section 6.03.
IPO shall mean an underwritten public offering by Holdings (or its direct or indirect parent company) of Equity Interests in Holdings (or in its direct or indirect parent company, as the case may be) after the Closing Date pursuant to a registration statement filed with the SEC in accordance with the Securities Act (whether alone or in connection with a secondary public offering).
IPO Reorganization Transactions shall mean transactions taken in connection with and reasonably related to consummating an IPO, in each case, whether or not consummated.
IRS shall mean the U.S. Internal Revenue Service.
ISP shall mean, with respect to any Letter of Credit, the International Standby Practices 1998 published by the Institute of International Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).
Issuing Bank shall mean, as the context may require, (a) GS, together with its permitted successors and assigns in such capacity; (b) any other Lender or Lenders that may become an Issuing Bank pursuant to Section 2.18(1) or (k) with respect to Letters of Credit issued by such Lender; and/or (c) collectively, all of the foregoing; provided that no Issuing Bank shall be required to issue Commercial Letters of Credit without its consent and the aggregate amount of all Letters of Credit issued by a Revolving Lender shall not exceed such Revolving Lenders Revolving Commitment. Any Issuing Bank may, at its discretion, arrange for one or more Letters of Credit to be issued by one or more Affiliates or designees of such Issuing Bank (and each such Affiliate or designee shall be deemed to be an Issuing Bank for all purposes of the Loan Documents). In the event that there is more than one Issuing Bank at any time, references herein and in the other Loan Documents to the Issuing Bank shall be deemed to refer to the Issuing Bank in respect of the applicable Letter of Credit or to all Issuing Banks, as the context requires.
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Joinder Agreement shall mean a joinder agreement substantially in the form of Exhibit F, with such amendments as may be reasonably and mutually agreed between the Administrative Agent and the Borrower.
Junior Secured Indebtedness shall mean senior Indebtedness of the Credit Parties for borrowed money that is secured by Liens on the Collateral (a) on a junior basis to the Liens securing the Secured Obligations and any Permitted Pari Passu Refinancing Debt (but not on a junior basis to any Indebtedness that is itself secured on a junior basis to the Secured Obligations), or (b) on a junior basis to any Indebtedness that is itself secured on a junior basis to the Secured Obligations, in the cause of clauses (a) and (b), in accordance with an Intercreditor Agreement.
Lanyon shall mean Lanyon Solutions, Inc., a Delaware corporation.
Latest Maturity Date as of any date of determination, shall mean the latest maturity or expiration date applicable to any Loan or Commitment hereunder at such time, including the latest maturity or expiration date of any Incremental Term Loan or any Incremental Revolving Loan, in each case that is governed by the terms of this Agreement and the other Loan Documents, any Refinancing Term Loan or any Refinancing Revolving Loan.
LC Commitment shall mean the commitment of the Issuing Bank to issue Letters of Credit pursuant to Section 2.18.
LC Disbursement shall mean a payment or disbursement made by the Issuing Bank pursuant to a drawing under a Letter of Credit.
LC Exposure shall mean at any time the sum of (a) the aggregate undrawn amount of all outstanding Letters of Credit at such time (including, without limitation, any and all Letters of Credit for which documents have been presented that have not been honored or dishonored) plus (b) the aggregate principal amount of all Reimbursement Obligations outstanding at such time. The LC Exposure of any Revolving Lender at any time shall equal its Pro Rata Percentage of the aggregate LC Exposure at such time.
LC Extension shall have the meaning assigned to such term in Section 2.18(c).
LC Obligations shall mean, as at any date of determination, the aggregate amount available to be drawn under all outstanding Letters of Credit plus the aggregate of all outstanding Reimbursement Obligations. For purposes of computing the amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1,12. For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be outstanding in the amount so remaining available to be drawn.
LC Participation Fee shall have the meaning assigned to such term in Section 2.05(c).
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LC Request shall mean an application and agreement for the issuance or amendment of a Letter of Credit in the form from time to time in use by the Issuing Bank in accordance with the terms of Section 2.18(b) and substantially in the form of Exhibit G, appropriately completed and signed by a Responsible Officer of the Borrower.
LC Sublimit shall mean $10,000,000.
LCT Election shall mean the Borrowers election to test the permissibility of a Limited Condition Transaction in accordance with the methodology set forth in Section 1,06.
LCT Test Date shall have the meaning given to that term in Section 1,06.
Lead Arrangers shall mean GS, Antares Holdings LP, Jefferies Finance LLC (acting through any of its Affiliates) and RBC Capital Markets, in their respective capacities as joint lead arrangers and joint bookrunners.
Leases shall mean any and all leases, subleases, tenancies, options, concession agreements, rental agreements, occupancy agreements, access agreements and any other agreements (including all amendments, extensions, replacements, renewals, modifications and/or guarantees thereof), whether or not of record and whether now in existence or hereafter entered into, affecting the use or occupancy of all or any portion of any Real Property.
Lenders shall mean (a) the financial institutions and other entities that have become a party hereto as lenders hereunder and (b) any financial institution or other entity that has become a party hereto pursuant to an Assignment and Assumption, other than, in each case, any such financial institution or other entity that has ceased to be a party hereto pursuant to an Assignment and Assumption. Unless the context clearly indicates otherwise, the term Lenders shall include the Swing Line Lender and an Issuing Bank.
Letter of Credit shall mean (i) any Standby Letter of Credit, and (ii) any Commercial Letter of Credit, in each case issued or to be issued by an Issuing Bank for the account of the Borrower or any Wholly Owned Restricted Subsidiary thereof pursuant to Section 2.18.
Letter of Credit Expiration Date shall mean the date which is five Business Days prior to the Revolving Maturity Date then in effect (or, if such date is not a Business Day, the next succeeding Business Day), or such later date to the extent such Letter of Credit has been cash collateralized in an amount equal to 103% of the LC Exposure or backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank for such period after the Revolving Maturity Date.
LIBO Rate shall mean, with respect to any Eurodollar Borrowing for any Interest Period, the rate per annum equal to the London Interbank Offered Rate or a comparable or successor rate, which rate is approved by the Administrative Agent, as published on the applicable Bloomberg screen page (or such other commercially available source providing such quotations as may be designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such
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Interest Period, for Dollar deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period (such rate, the Eurodollar Screen Rate); provided that to the extent a comparable or successor rate is approved by the Administrative Agent in connection herewith, the approved rate shall be applied in a manner consistent with market practice; provided further that to the extent such market practice is not administratively feasible for the Administrative Agent, such approved rate shall be applied in a manner as otherwise reasonably determined by the Administrative Agent. If the LIBO Rate shall be less than zero, such rate shall be deemed zero for purposes of this Agreement.
Notwithstanding anything contained herein to the contrary, and without limiting the provisions of Section 2.11, in the event that the Administrative Agent shall have determined in good faith (which determination shall be final and conclusive and binding upon all parties hereto), in consultation with the Borrower, that there exists, at any time, a market convention for determining a rate of interest for syndicated loans in the United States that is widely recognized as the successor to interest rates based on the Eurodollar Screen Rate, and the Administrative Agent shall have given notice of such determination to the Borrower and each Lender (it being understood that the Administrative Agent make such a determination of whether such market condition exists at any time, upon the reasonable request of the Borrower), then the Administrative Agent and the Borrower shall enter into an amendment to this Agreement to reflect such alternate rate of interest and such other related changes to this Agreement as may be applicable consistent with market practice. Notwithstanding anything to the contrary in Section 10.02, such amendment shall become effective without any further action or consent of any other party to this Agreement so long as the Lenders shall have received at least five Business Days prior written notice thereof and the Administrative Agent shall not have received, within five Business Days of the date of such notice to the Lenders, a written notice from the Required Lenders stating that the Required Lenders object to such amendment. Until an alternate rate of interest shall be determined in accordance with this paragraph (but only to the extent the Eurodollar Screen Rate for the applicable Interest Period is not available or published at such time on a current basis), (x) no Loans may be made as, or converted to, Eurodollar Loans, and (y) any Borrowing Notice or Interest Election Request given by the Borrower with respect to Eurodollar Loans shall be deemed to be rescinded by the Borrower.
Lien shall mean, with respect to any property, (a) any mortgage, deed of trust, lien, license, pledge, encumbrance, claim, charge, assignment for security, hypothecation, security interest or encumbrance of any kind or any arrangement to provide priority or preference, including any easement, right-of-way or other encumbrance on title to owned Real Property, in each of the foregoing cases whether voluntary or imposed by law; (b) the interest of a vendor or a lessor under any conditional sale agreement, Capital Lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such property; provided that in no event shall an operating lease be deemed to be a Lien; and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.
Limited Condition Transaction shall mean (i) any Investment, or any acquisition of any assets, business or person, permitted hereunder (subject to Section 1,06 and including, for the avoidance of doubt, any Permitted Acquisition) by Holdings or one or more of its Restricted Subsidiaries, including by way of merger or amalgamation, whose consummation is not conditioned on the availability of, or on obtaining, third party financing, or (ii) any redemption, repurchase, defeasance, satisfaction and discharge or repayment of Indebtedness requiring irrevocable notice in advance of such redemption, repurchase, defeasance, satisfaction and discharge or repayment.
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Loan Documents shall mean this Agreement, any amendments hereto, the Letters of Credit, the LC Requests, the Applications, any Intercreditor Agreement, the Notes (if any), the Security Documents, the Fee Letters (other than for purposes of Section 10.02) and intercreditor agreements and subordination agreements entered into pursuant to the terms hereof that any Credit Party is party to and any other document designated as such by the Borrower and the Administrative Agent, in each case as amended, amended and restated, restated, supplemented and/or modified from time to time.
Loans shall mean, as the context may require, a Revolving Loan, Term Loan or Swing Line Loan.
Management Equityholders shall mean any of (i) any current or former director, officer, employee or member of management of Holdings or any of its Subsidiaries or any direct or indirect parent company thereof who, on the Closing Date, is an equityholder in Holdings or any direct or indirect parent thereof, (ii) any trust, partnership, limited liability company, corporate body or other entity established by any such current or former director, officer, employee, or member of management of Holdings or any of its Subsidiaries or any direct or indirect parent thereof or any Person described in the succeeding clauses (iii) and (iv), as applicable, to hold an investment in Holdings or any direct or indirect parent thereof in connection with such Persons estate or tax planning, (iii) any spouse, former spouse, parents or grandparents or any descendant (including adopted children and step-children) or spouse or former spouse of the foregoing, of any such current or former director, officer, employee or member of management of Holdings or any of its Subsidiaries or any direct or indirect parent thereof, who is transferred Equity Interests of Holdings or any direct or indirect parent thereof by any such director, officer, employee or member of management of Holdings or any of its Subsidiaries or any direct or indirect parent thereof (or by any vehicle described in clause (ii) above), in connection with such Persons estate or tax planning, and (iv) any Person who acquires an investment in Holdings or any direct or indirect parent thereof by will or by the laws of intestate succession as a result of the death of any such current or former director, officer, employee or member of management of Holdings or any of its Subsidiaries or any direct or indirect parent thereof or of any person described in clause (iii) immediately above.
Management Services Agreement shall mean that certain Management Agreement, dated as of November 29, 2016, by and among Vista Equity Partners Management, LLC, the Borrower and certain Affiliates of the Borrower from time to time party thereto, as amended, restated, amended and restated, supplemented and/or modified from time to time in a manner that is not materially adverse to the interests of the Lenders; provided that any amendment, restatement, amendment and restatement, supplement or other modification thereto to term out any fees under such Management Agreement in connection with an IPO shall not be considered materially adverse to the Lenders.
Margin Stock shall have the meaning assigned to such term in Regulation U.
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Material Adverse Effect shall mean a material adverse effect on (a) the business or financial condition or results of operations of Holdings and its Restricted Subsidiaries, taken as a whole, (b) the material rights and remedies (taken as a whole) of the Administrative Agent, the Collateral Agent or the Lenders under the Loan Documents (other than due to the action or inaction of the Administrative Agent, the Collateral Agent or the Lenders) or (c) the ability of the Borrower and the Guarantors, taken as a whole, to perform their payment obligations under the Loan Documents.
Material Property shall mean an individual Real Property owned in fee in the United States by any Credit Party, in each case, with a fair market value of $11,000,000 or more (such fair market value to be determined (x) in the case of any Real Property owned on the Closing Date, as of the Closing Date and (y) in the case of any Real Property acquired after the Closing Date, as of the date of acquisition thereof).
Maximum Accrual shall have the meaning assigned thereto in Section 2.25.
Maximum Incremental Facilities Amount shall mean an amount after the Closing Date equal to:
(i) (A) an aggregate amount equal to the greater of (I) $155,000,000 and (II) 100% of Consolidated EBITDA for the most recent Test Period, plus (B)the amount of any voluntary prepayments of any Loans, any Incremental Facility or any Permitted Incremental Equivalent Debt (in the case of any Permitted Incremental Equivalent Debt, to the extent secured on a pari passu basis with the Obligations) (in the case of any prepayment of Revolving Loans and/or Incremental Revolving Loans, to the extent accompanied by a corresponding permanent reduction in the relevant commitment) (it being understood that any such voluntary prepayment financed with the proceeds of Credit Agreement Refinancing Indebtedness shall not increase the calculation of the amount under this clause (i)(B)), in each case to the extent financed with sources other than the proceeds of long-term Indebtedness (other than revolving Indebtedness to the extent intended to be repaid from operating cash flow) of Holdings or its Restricted Subsidiaries, plus (C) debt buybacks by Holdings and its Restricted Subsidiaries in accordance with Section 10.04(b)(viii), or any corresponding provision of any Permitted Incremental Equivalent Debt (in each case to the extent offered to all similarly-situated lenders or holders, as applicable, and, in the case of any Permitted Incremental Equivalent Debt, to the extent secured on a pari passu basis with the Obligations) (it being understood that (x) any such debt buybacks financed with the proceeds of Credit Agreement Refinancing Indebtedness shall not increase the calculation of the amount under this clause (i)(C) and (y) in the case of any such debt buyback that is consummated at a discount to par, the calculation of the amount under this clause (C) shall be limited to the actual cash expenditures in respect thereof), in each case to the extent financed with sources other than the proceeds of long-term Indebtedness (other than revolving Indebtedness to the extent intended to be repaid from operating cash flow) of Holdings or its Restricted Subsidiaries, plus (D) payments required by Sections 2,16(b)(B) or 10.02(f)(i) (or any corresponding provision of any Permitted Incremental Equivalent Debt) (in each case solely to the extent such payment is made in retirement of the applicable Loans, Incremental Term Loans, Incremental Revolving Loans or Permitted
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Incremental Equivalent Debt, as applicable and, in the case of any payment of Revolving Loans and/or Incremental Revolving Loans, to the extent accompanied by a corresponding permanent reduction in the relevant commitment), plus (E) in the case of an Incremental Facility that is being incurred using the Fixed Incremental Amount that serves to effectively extend the maturity of the Term Loans, the Revolving Loans and/or any other Incremental Facility, an amount equal to the portion of the Term Loans, the Revolving Loans and/or any other Incremental Facility to be replaced with such Incremental Facility (the Fixed Incremental Amount), plus
(ii) an unlimited amount so long as, on a Pro Forma Basis as of the Applicable Date of Determination and for the applicable Test Period, determined after giving effect to the incurrence of any such Incremental Facility or any such Permitted Incremental Equivalent Debt and any Permitted Acquisition or other acquisition consummated in connection therewith, any Indebtedness repaid with the proceeds thereof and any Investment, disposition or debt incurrence in connection therewith and all other pro forma adjustments, with respect to any such Incremental Facility or Permitted Incremental Equivalent Debt that is (A) secured on a pari passu basis with the Secured Obligations, the First Lien Leverage Ratio shall not exceed the greater of (I) 4.50 to 1.00 and (II) if incurred in connection with a Permitted Acquisition or other Investment, the First Lien Leverage Ratio as of the Applicable Date of Determination and for the most recently ended Test Period immediately prior to such transactions; (B) secured on a junior basis to the Secured Obligations (but not on a junior basis to any Indebtedness that is itself secured on a junior basis to the Secured Obligations), the Senior Secured Leverage Ratio shall not exceed the greater of (I) 6.50 to 1.00 and (II) if incurred in connection with a Permitted Acquisition or other Investment, the Senior Secured Leverage Ratio as of the Applicable Date of Determination and for the most recently ended Test Period immediately prior to such transactions; or (C) unsecured or secured on a junior basis to any Indebtedness that is itself secured on a junior basis to the Secured Obligations, either (I) the Consolidated Interest Coverage Ratio is greater than or equal to either (x) 2.00 to 1.00 or (y) the Consolidated Interest Coverage Ratio for the most recently ended Test Period immediately prior to such transactions, or (II) the Total Leverage Ratio shall not exceed the greater of (x) 6.50 to 1.00 and (y) if incurred in connection with a Permitted Acquisition or other Investment, the Total Leverage Ratio as of the Applicable Date of Determination and for the most recently ended Test Period immediately prior to such transactions (the ratios in clauses (A), (B) and (C), collectively, or any such ratio individually, as applicable, the Incurrence Ratio); provided that, notwithstanding anything herein to the contrary, (v) the Borrower may in its sole discretion elect to use this clause (ii) regardless of whether at such time the Borrower has capacity under the Fixed Incremental Amount; (w) in the event that any Incremental Facilities or Permitted Incremental Equivalent Debt is incurred in reliance on the Fixed Incremental Amount concurrently with, or in a series of related transactions with, the incurrence of any Incremental Facility or Permitted Incremental Equivalent Debt pursuant to this clause (ii), the Borrower may elect to use this clause (ii) prior to using the Fixed Incremental Amount (in which case, for the avoidance of doubt, the Incurrence Ratio shall first be calculated without giving effect to any loans or commitments incurred or to be so incurred using the Fixed Incremental Amount but giving full pro forma effect to the use of proceeds of all such loans and commitments and other related transactions)
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and if the Incurrence Ratio and the Fixed Incremental Amount are available and the Borrower does not make an election, then the Borrower will be deemed to have elected to use the Incurrence Ratio prior to using any amount available under the Fixed Incremental Amount and thereafter, the incurrence portion of such loans or commitments to be incurred using the Fixed Incremental Amount shall be calculated; (x) for purposes of determining compliance with the foregoing Incurrence Ratio in this clause (ii), any Incremental Revolving Loan Commitments (and any other unfunded commitments) shall be deemed to be drawn in full and the cash proceeds of any such Incremental Term Loans, Incremental Revolving Loan Commitments and Permitted Incremental Equivalent Debt incurred substantially concurrently therewith, or in a series of related transactions therewith, shall not be cash netted, but any use thereof to prepay Indebtedness shall be given pro forma effect; (y) to the extent the proceeds of any Incremental Facility or Permitted Incremental Equivalent Debt are intended to be applied to finance a Limited Condition Transaction, if the Borrower has made an LCT Election with respect to such Limited Condition Transaction, Consolidated Total Funded Indebtedness, Unrestricted Cash, Consolidated EBITDA and Consolidated Cash Interest Expense, for purposes of determining compliance with the Incurrence Ratio, shall be determined instead, on a Pro Forma Basis, only (i) in the case of Consolidated Total Funded Indebtedness and Unrestricted Cash, as of the date, and (ii) with respect to Consolidated EBITDA and Consolidated Cash Interest Expense, for the Test Period most recently ended prior to the date, in each case on which the relevant agreement (or in the case of an LCT Transaction that involves some other manner of establishing a binding obligation under local law, such other binding obligation to consummate such transaction) with respect to such Limited Condition Transaction is entered into as if the Limited Condition Transaction had occurred on such date; and (z) the Borrower may at any time reclassify any Indebtedness originally incurred under the Fixed Incremental Amount as having been incurred under this clause (ii), so long as at such time, the Borrower would be permitted to incur under this clause (ii) the aggregate principal amount of the Indebtedness being so reclassified (for purposes of clarity, with any such reclassification having the effect of increasing the Borrowers ability to incur Indebtedness under the Fixed Incremental Amount on and after the date of such reclassification by the amount of Indebtedness so re-designated) (the provisions of this clause (z), the Incremental Reclassification Provision). For the avoidance of doubt and subject to the foregoing clause (z), any amounts incurred in reliance on the Fixed Incremental Amount as an Incremental Facility or Permitted Incremental Equivalent Debt shall thereafter reduce the amount of Permitted Incremental Equivalent Debt or Incremental Facilities that may be incurred in reliance thereon.
Maximum Rate shall have the meaning assigned to such term in Section 10,14.
Maximum Tender Condition shall have the meaning assigned to such term in Section 2.23(b).
Minimum Borrowing Amount shall mean
(a) in the case of Eurodollar Loans, $250,000;
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(b) in the case of ABR Loans that are Term Loans, $250,000; and
(c) in the case of ABR Loans that are Revolving Loans, the lesser of $250,000 and the Revolving Commitment at such time.
Minimum Tender Condition shall have the meaning assigned to such term in Section 2.23(b).
MNPI shall have the meaning assigned to such term in Section 10.01(f).
Moodys shall mean Moodys Investors Service Inc.
Mortgage shall have the meaning assigned to such term in Section 5.10(c)(ii).
Multiemployer Plan shall mean a multiemployer plan within the meaning of Section 4001(a)(3) or Section 3(37) of ERISA which is subject to Title IV of ERISA (a) to which any Group Member or any of its ERISA Affiliates is then making or accruing an obligation to make contributions, or (b) with respect to which any Group Member or any of its ERISA Affiliates has any liability.
Net Cash Proceeds shall mean:
(a) with respect to any Asset Sale (other than any issuance or sale of Equity Interests), the proceeds thereof in the form of cash, cash equivalents (including Cash Equivalents) and marketable securities (including any such proceeds received by way of deferred payment of principal pursuant to a note or installment receivable or purchase price adjustment receivable, or by the sale, transfer or other disposition of any non-cash consideration received in connection therewith or otherwise, but only as and when received) received by any Group Member, net of, without duplication, (i) fees and expenses (including brokers fees or commissions, discounts, legal, accounting and other professional and transactional fees, transfer and similar taxes and the Borrowers good faith estimate of taxes paid or payable in connection with such sale or with the repatriation of such proceeds (after taking into account any available tax credits or deductions and any payments or payable amounts under tax sharing arrangements permitted under the Loan Documents) (provided that, to the extent and at the time that any such taxes are no longer required to be paid or payable, such amounts then constitute Net Cash Proceeds)), (ii) amounts provided as a reserve, in accordance with GAAP, against (x) any liabilities under any indemnification obligations, earn-out obligations or purchase price adjustments associated with such Asset Sale or (y) any other liabilities retained or payable by any Group Member associated with the Properties sold in such Asset Sale (provided that, to the extent and at the time any such amounts are released from such reserve, such amounts shall constitute Net Cash Proceeds), (iii) the principal amount, premium or penalty, if any, interest and other amounts on any Indebtedness for borrowed money (other than the Loans) that is secured by a Lien on the Properties sold in such Asset Sale (so long as such Lien was permitted to encumber such Properties under the Loan Documents at the time of such sale and was not a pari passu or junior lien on the Collateral) and which is repaid with such proceeds (other than any such Indebtedness assumed by the purchaser of such Properties) and (iv) the Borrowers good faith estimate of the amount of payments required to be made with respect to unassumed liabilities relating to the properties sold within 360 days of such Asset Sale (provided that to the extent such cash proceeds are not used to make payments in respect of such unassumed liabilities within 360 days after such Asset Sale, such cash proceeds shall constitute Net Cash Proceeds);
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(b) with respect to any Casualty Event, the cash insurance proceeds, condemnation awards and other compensation received by, or on behalf of, any Group Member in respect thereof, net of all costs and expenses incurred in connection with the collection of such proceeds, awards or other compensation in respect of such Casualty Event (including, in respect of any such Casualty Event, transfer and similar taxes and the Borrowers good faith estimate of taxes paid or payable in connection with such Casualty Event or with the repatriation of such proceeds (after taking into account any available tax credits or deductions and any payments or payable amounts under tax sharing arrangements permitted under the Loan Documents) (provided that, to the extent and at the time that any such taxes are no longer required to be paid or payable, such amounts shall then constitute Net Cash Proceeds));
(c) with respect to any issuance or sale of Equity Interests by Holdings or any of its Restricted Subsidiaries, the cash proceeds thereof, net of Taxes (including Taxes payable upon the repatriation of any such proceeds to a Group Member), fees, commissions, costs and other expenses incurred in connection therewith; and
(d) with respect to any Debt Issuance by Holdings or any of its Restricted Subsidiaries, the cash proceeds thereof, net of Taxes (including Taxes payable upon repatriation of the proceeds to a Group Member), fees, commissions, costs and other expenses incurred in connection therewith.
Net Working Capital shall mean, at any time, Consolidated Current Assets at such time minus Consolidated Current Liabilities at such time.
Non-Consenting Lender shall mean any Lender that does not approve any consent, waiver or amendment that (i) requires the approval of all Lenders or all affected Lenders in accordance with the terms of Section 10.02 and (ii) has been approved by the Required Lenders (or the Required Revolving Lenders, as applicable) or more than 50% of the affected Lenders, as applicable.
Non-Extending Lender shall have the meaning assigned to such term in Section 2.21(e).
Not Otherwise Applied shall mean, with reference to any amount of proceeds of any transaction or event, that such amount (a) was not required to be applied to prepay the Loans pursuant to Section 2.10, (b) was not previously applied in determining the permissibility of a transaction under the Loan Documents where such permissibility was contingent on receipt of such amount or utilization of such amount for a specified purpose, (c) in the case of Net Cash Proceeds from Eligible Equity Issuances or from Equity Cure Contributions, was not otherwise used for or in connection with (i) Investments made pursuant to Section 6.03(v) or (x), (ii) Dividends made pursuant to Section 6.06(f) or (i), (iii) prepayments of Indebtedness pursuant to Section 6.09(a)(A), (B) or (F), (iv) the inclusion thereof as an Equity Cure Contribution in the calculation of Consolidated EBITDA for purposes of determining compliance with the Financial Covenant, pursuant to Section 8.03(a) or (v) the incurrence of Indebtedness pursuant to Section 6.01(w), and (d) was not previously applied to increase the Cumulative Amount pursuant to the definition thereof.
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Notes shall mean any notes evidencing the Term Loans, Revolving Loans or Swing Line Loans issued pursuant to this Agreement, if any, substantially in the form of Exhibit H-l, H-2 or H-3, as applicable.
Notice of Intent to Cure shall have the meaning assigned to such term in Section 8.03(a).
Obligations shall mean obligations of the Borrower and the other Credit Parties from time to time arising under or in respect of the due and punctual payment of (i) the principal of and premium, if any, and interest (including interest accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding) on the Loans, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, (ii) each payment required to be made by the Borrower and the other Credit Parties under this Agreement in respect of any Letter of Credit, when and as due, including payments in respect of Reimbursement Obligations with respect to Letters of Credit, interest thereon and obligations to provide cash collateral with respect thereto and (iii) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise (including fees and other monetary obligations incurred during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding), of the Borrower and the other Credit Parties under this Agreement and the other Loan Documents; provided that, notwithstanding anything to the contrary, the Obligations shall exclude any Excluded Swap Obligations.
OFAC shall mean the U.S. Department of the Treasury, Office of Foreign Assets Control.
Offer Process shall have the meaning assigned to such term in Section 10.04(b)(viii)(B).
Organizational Documents shall mean, with respect to any person, (i) in the case of any corporation, the certificate of incorporation and by-laws (or similar documents) of such person, (ii) in the case of any limited liability company, the certificate of formation and operating agreement (or similar documents) of such person, (iii) in the case of any limited partnership, the certificate of limited partnership and limited partnership agreement (or similar documents) of such person, (iv) in the case of any general partnership, the partnership agreement (or similar document) of such person and (v) in any other case, the functional equivalent of the foregoing.
Original Acquisition shall mean, collectively, on the Original Closing Date, (i) the merger of Papay Merger Sub, Inc., a Delaware corporation (Merger Sub) and Cvent, through one or more steps, with Cvent as the surviving entity, pursuant to the Agreement and Plan of Merger, dated as of April 17, 2016, by and among Holdings, Merger Sub, and Cvent, and (ii) the acquisition of all of the outstanding equity interests of Lanyon by Papay Topco, LLC, a Delaware limited liability company (Topco) and contribution of all such equity interests of Lanyon to Cvent by Topco pursuant to the Contribution and Exchange Agreement, dated as of the Original Closing Date, by and among Topco, Athlaction Holdings, LLC, a Delaware limited liability company and Lanyon.
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Original Closing Date shall mean November 29, 2016.
Other Intercreditor Agreement shall mean any intercreditor agreement executed in connection with any transaction requiring such agreement to be executed pursuant to the terms hereof, or otherwise required to be executed pursuant to the terms hereof, among the Administrative Agent, the Collateral Agent and one or more other Senior Representatives of Indebtedness, or any other party, as the case may be, and acknowledged and agreed to by the Borrower and the Guarantors, substantially on terms set forth on Exhibit M (except to the extent otherwise reasonably agreed by the Borrower and the Administrative Agent), in each case, as amended, restated, amended and restated, supplemented, renewed, replaced, refinanced or otherwise modified from time to time.
Other Taxes shall mean all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes or any other excise or property Taxes, charges or similar levies arising from any payment made hereunder or under any other Loan Document or from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or with respect to, this Agreement or any other Loan Document (and any interest, additions to tax or penalties applicable thereto), except for any such Taxes described in clause (a)(ii) of the definition of Excluded Taxes that are payable in connection with an assignment (other than an assignment made pursuant to Section 2.16).
Participant shall have the meaning assigned to such term in Section 10.04(d)(i).
Participant Register shall have the meaning assigned to such term in Section 10.04(d)(iii).
Patriot Act shall have the meaning assigned to such term in Section 3.19.
PBGC shall mean the Pension Benefit Guaranty Corporation referred to and defined in ERISA.
Permitted Acquisition shall mean any transaction or series of related transactions by Holdings or any of its Restricted Subsidiaries for (a) the direct or indirect acquisition of all or substantially all of the property of any Person, or of any assets constituting a line of business, business unit, division or product line (including research and development and related assets in respect of any product) of any Person; (b) the acquisition (including by merger or consolidation) of the Equity Interests (other than director qualifying shares) of any Person that becomes a Restricted Subsidiary after giving effect to such transaction; or (c) a merger or consolidation or any other combination with any Person (so long as a Credit Party (including for the avoidance of doubt (except in the case of a merger, consolidation or other combination involving the Borrower), any such Person that becomes a Credit Party upon the consummation of such merger, consolidation or other combination), to the extent such Credit Party is a party to such merger, consolidation or other combination, is the surviving entity); provided that each of the following conditions shall be met or waived by the Required Lenders:
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(i) subject to Section 1,06 with respect to Limited Condition Transactions, no Event of Default under Section 8.01(a), (b), (g) or (h) has occurred and is continuing immediately before giving pro forma effect to such acquisition and immediately after giving effect to such acquisition; and
(ii) immediately after giving effect to such transaction, Holdings and its Restricted Subsidiaries shall be in compliance with Section 6.12.
Notwithstanding anything to the contrary contained in the immediately preceding sentence, an acquisition which does not otherwise meet the requirements set forth above in the definition of Permitted Acquisition shall constitute a Permitted Acquisition if, and to the extent, the Required Lenders agree in writing, prior to the consummation thereof, that such acquisition shall constitute a Permitted Acquisition for purposes of this Agreement.
Permitted Debt Exchange shall have the meaning given to that term in Section 2.23(a).
Permitted Debt Exchange Notes shall have the meaning given to that term in Section 2.23(a).
Permitted Debt Exchange Offer shall have the meaning given to that term in Section 2.23(a).
Permitted Holder shall mean any of (i) the Sponsor, the Sponsors Affiliates (other than any portfolio company of the Sponsor) and the Management Equityholders and any group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or any successor provision) of which any of the foregoing are members (provided, that the Sponsor, the Sponsors Affiliates and/or the Management Equityholders collectively comprise at least a majority in interest of such group); (ii) any direct or indirect parent of the Borrower not formed in connection with, or in contemplation of, a transaction (other than the Transactions) that, assuming such parent was not formed, after giving effect thereto would constitute a Change of Control; and (iii) any Person who is acting solely as an underwriter in connection with a public or private offering of Capital Stock of Holdings or any direct or indirect parent of Holdings, acting in such capacity.
Permitted Incremental Equivalent Debt shall mean Indebtedness issued, incurred or otherwise obtained by the Borrower (which may be guaranteed by any other Credit Party) in respect of one or more series of senior unsecured notes, senior notes secured on a basis pari passu with or junior to the Secured Obligations, or subordinated notes (in each case issued in a public offering or a Rule 144 A or other private placement or a bridge financing in lieu of the foregoing so long as the long-term debt into which such bridge financing is to be converted satisfies the provisions of this definition (and any Registered Equivalent Notes issued in exchange therefor)), loans that are secured on a basis pari passu with or junior to the Secured Obligations or loans that are unsecured, or notes or loans constituting secured or unsecured mezzanine Indebtedness, in each case that is or are issued or made in lieu of Incremental
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Facilities; provided that (i) the aggregate principal amount of all Permitted Incremental Equivalent Debt at the time of issuance or incurrence shall not exceed the Maximum Incremental Facilities Amount at such time, (ii) the terms applicable to such Permitted Incremental Equivalent Debt shall comply with the Required Debt Terms, (iii) if such Permitted Incremental Equivalent Debt is secured on a pari passu basis with the Secured Obligations, such Permitted Incremental Equivalent Debt shall be subject to Section 2.20(f) (as if such Indebtedness were Incremental Term Loans secured on a pari passu basis with the Secured Obligations) and (iv) subject to Section 1,06, and (solely if such Permitted Incremental Equivalent Debt is incurred in connection with a Limited Condition Transaction) unless (other than in the case of an Event of Default under Section 8.01(a), (b), (g) or (h)) waived by the lenders in respect of such Permitted Incremental Equivalent Debt, no Event of Default (or, in the case of any Permitted Incremental Equivalent Debt the proceeds of which will be used for a Permitted Acquisition or similar Investment, no Event of Default under Section 8.01(a), (b), (g) or (h)) shall have occurred and be continuing at the time of such issuance or incurrence or immediately after giving effect thereto.
Permitted Junior Refinancing Debt shall mean secured Indebtedness incurred by the Borrower and guarantees with respect thereto by any Credit Party; provided that (i) such Indebtedness is secured by the Collateral on a junior basis to the Secured Obligations and the obligations in respect of any Permitted Pari Passu Refinancing Debt, in each case pursuant to a First Lien/Second Lien Intercreditor Agreement, and is not secured by any property or assets of Holdings and its Restricted Subsidiaries other than the Collateral, (ii) such Indebtedness constitutes Credit Agreement Refinancing Indebtedness in respect of Term Loans, Incremental Term Loans, Refinancing Term Loans, Revolving Loans, Incremental Revolving Loans, or Refinancing Revolving Loans, and (iii) a Senior Representative validly acting on behalf of the holders of such Indebtedness shall have become party to the a First Lien/Second Lien Intercreditor Agreement. Permitted Junior Refinancing Debt will include any Registered Equivalent Notes issued in exchange therefor.
Permitted Liens shall have the meaning assigned to such term in Section 6.02.
Permitted Pari Passu Refinancing Debt shall mean any secured Indebtedness incurred by the Borrower and guarantees with respect thereto by any Credit Party; provided that (i) such Indebtedness is secured by the Collateral on a pari passu basis (but without regard to the control of remedies) with the Secured Obligations and is not secured by any property or assets of Holdings or its Restricted Subsidiaries other than the Collateral, (ii) such Indebtedness constitutes Credit Agreement Refinancing Indebtedness in respect of Term Loans, Incremental Term Loans, Refinancing Term Loans, Revolving Loans, Incremental Revolving Loans, or Refinancing Revolving Loans, and (iii) a Senior Representative validly acting on behalf of the holders of such Indebtedness shall have become party to an Other Intercreditor Agreement. Permitted Pari Passu Refinancing Debt will include any Registered Equivalent Notes issued in exchange therefor.
Permitted Refinancing shall mean, with respect to any Person, any modification, refinancing, refunding, renewal, replacement or extension of any Indebtedness of such Person; provided that (a) the principal amount (or accreted value, if applicable) thereof does not exceed the principal amount (or accreted value, if applicable) of the Indebtedness so modified, refinanced, refunded, renewed, replaced or extended except by an amount equal to
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unpaid accrued interest and premium thereon plus other amounts paid, and fees, expenses, commissions, underwriting discounts and expenses incurred, in connection with such modification, refinancing, refunding, renewal, replacement or extension, and by an amount equal to any existing commitments unutilized thereunder, (b) other than with respect to a Permitted Refinancing of Indebtedness permitted pursuant to Section 6.01(e), such modification, refinancing, refunding, renewal, replacement or extension has a final maturity date equal to or later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being modified, refinanced, refunded, renewed, replaced or extended, (c) other than with respect to a Permitted Refinancing of Indebtedness permitted pursuant to Section 6.01(e), at the time thereof, no Event of Default shall have occurred and be continuing, (d) to the extent such Indebtedness being modified, refinanced, refunded, renewed, replaced or extended is subordinated in right of payment to the Obligations, such modification, refinancing, refunding, renewal, replacement or extension is subordinated in right of payment to the Obligations on terms, taken as a whole, at least as favorable (as reasonably determined by the Borrower) to the Lenders in all material respects as those contained in the documentation governing the subordination of the Indebtedness being modified, refinanced, refunded, renewed, replaced or extended, (e) neither Holdings nor any of its Restricted Subsidiaries shall be an obligor or guarantor of any such refinancings, replacements, refundings, renewals, replacements or extensions except to the extent that such Person was such an obligor or guarantor in respect of the applicable Indebtedness being modified, refinanced, refunded, renewed, replaced or extended, (f) such modification, refinancing, refunding, renewal, replacement or extension shall not be secured by any Lien on any asset other than the assets that secured such Indebtedness being modified, refinanced, refunded, renewed, replaced or extended and (g) such modification, refinancing, refunding, renewal, replacement or extension shall not (if secured) have a higher Lien priority than such Indebtedness being modified, refinanced, refunded, renewed, replaced or extended.
Permitted Reorganization shall have the meaning assigned to such term in Section 6.03(gg).
Permitted Unsecured Refinancing Debt shall mean unsecured Indebtedness incurred by the Borrower and guarantees with respect thereto by any Credit Party; provided that such Indebtedness constitutes Credit Agreement Refinancing Indebtedness in respect of Term Loans, Incremental Term Loans, Refinancing Term Loans, Revolving Loans, Incremental Revolving Loans, or Refinancing Revolving Loans. Permitted Unsecured Refinancing Debt will include any Registered Equivalent Notes issued in exchange therefor.
Person or person shall mean any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.
Plan shall mean any employee pension benefit plan (as such term is defined in Section 3(2) of ERISA) (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 or 430 of the Code or Section 302 of ERISA which is maintained or contributed to by any Group Member or any of its ERISA Affiliates or with respect to which any Group Member or any of its ERISA Affiliates has any liability.
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Platform shall have the meaning assigned to such term in Section 10.01(e).
Principal Office shall mean New York City or such other location as the Administrative Agent may notify the Borrower from time to time.
Private Side Communications shall have the meaning assigned to such term in Section 10.01(f).
Private Siders shall have the meaning assigned to such term in Section 10.01(f).
Pro Forma Basis shall mean, with respect to the calculation of all financial ratios and tests (including the First Lien Leverage Ratio, the Senior Secured Leverage Ratio, the Total Leverage Ratio, the Consolidated Interest Coverage Ratio and the amount of Consolidated Total Assets and Consolidated EBITDA) contained in this Agreement other than for purposes of calculating Excess Cash Flow, in each case as of any date, that such calculation shall give pro forma effect to the Transactions and all Subject Transactions (and the application of the proceeds from any such asset sale or debt incurrence) that have occurred during the relevant testing period for which such financial test or ratio is being calculated and during the period immediately following such period and prior to or substantially concurrently with the event for which the calculation of any such ratio is made, including pro forma adjustments arising out of events which are attributable to the Transactions, the proposed Subject Transaction and all other Subject Transactions that have been consummated during the relevant period, including giving effect to those specified in accordance with the definition of Consolidated EBITDA, in each case as certified on behalf of Holdings by a Financial Officer of Holdings, using, for purposes of determining such compliance with a financial test or ratio (including any incurrence test), the historical financial statements of all entities, divisions or lines or assets so acquired or sold and the consolidated financial statements of Holdings and/or any of its Restricted Subsidiaries, calculated as if the Transactions or such Subject Transaction, and all other Subject Transactions that have been consummated during the relevant period, and any Indebtedness incurred or repaid in connection therewith, had been consummated (and the change in Consolidated EBITDA resulting therefrom) and incurred or repaid at the beginning of such period, and Consolidated Total Assets shall be calculated after giving effect thereto.
Whenever pro forma effect is to be given to the Transactions or a Subject Transaction, the pro forma calculations shall be made in good faith by a Financial Officer of Holdings (as set forth in a certificate of such Financial Officer delivered to the Administrative Agent) (including adjustments for costs and Charges arising out of the Transactions, the proposed Subject Transaction and all other Subject Transactions that have been consummated during the relevant period, and the run-rate cost savings and synergies resulting from the Transactions or such Subject Transact! on(s) that have been or are reasonably anticipated to be realizable (run-rate means the full recurring benefit for a test period that is associated with any action taken or expected to be taken or for which a plan for realization has been established (including any savings expected to result from the elimination of a public targets compliance costs with public company requirements), net of the amount of actual benefits realized during such test period from such actions), and any such adjustments included in the initial pro forma calculations shall continue to apply to subsequent calculations of such financial ratios or tests,
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including during any subsequent test periods in which the effects thereof are expected to be realizable); provided that (i) such amounts are factually supportable and reasonably identifiable and are projected by the Borrower in good faith to be realizable within 36 months after the end of the test period in which the Transactions or the applicable Subject Transaction occurred, (ii) no amounts shall be added pursuant to this paragraph to the extent duplicative of any amounts that are otherwise added back in computing Consolidated EBITDA for such test period, and (iii) the provisions of this paragraph shall in no way limit the add-backs that may be made to Consolidated EBITDA pursuant to the definition thereof.
If any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest on such Indebtedness shall be calculated as if the rate in effect on the applicable date of determination for the event for which the calculation is made had been the applicable rate for the entire test period (taking into account any interest hedging arrangements applicable to such Indebtedness). Interest on a Capital Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by a Financial Officer of Holdings to be the rate of interest implicit in such Capital Lease Obligation in accordance with GAAP. Interest on Indebtedness that may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rate, shall be determined to have been based upon the rate actually chosen, or if none, then based upon such optional rate as the Borrower may designate.
Pro Rata Percentage of any Revolving Lender at any time shall mean the percentage of the total Revolving Commitments of all Revolving Lenders represented by such Lenders Revolving Commitment; provided that for purposes of Section 2.19(b), Pro Rata Percentage shall mean the percentage of the total Revolving Commitments (disregarding the Revolving Commitment of any Defaulting Lender to the extent its LC Exposure and Swing Line Exposure is reallocated to the non-Defaulting Lenders) represented by such Lenders Revolving Commitment. If the Revolving Commitments have terminated or expired, the Pro Rata Percentage shall be determined based upon the Revolving Commitments most recently in effect, after giving effect to any assignments.
Projections shall have the meaning assigned to such term in Section 3.13(a).
Property or property shall mean any right, title or interest in or to property or assets of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible and including Equity Interests or other ownership interests of any person and whether now in existence or owned or hereafter entered into or acquired, including all Real Property.
PTE means a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be amended from time to time.
Public Company Costs shall mean any costs, fees and expenses associated with, in anticipation of, or in preparation for, compliance with the requirements of the Sarbanes- Oxley Act of 2002 and the rules and regulations promulgated in connection therewith and costs, fees and expenses relating to compliance with the provisions of the Securities Act and the Exchange Act (as applicable to companies with equity or debt securities held by the public), the rules of national securities exchanges for companies with listed equity or debt securities, directors or managers compensation, fees and expense reimbursements, Charges relating to investor relations, shareholder meetings and reports to shareholders and debtholders, directors and officers insurance and other executive costs, legal and other professional fees and listing fees.
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Public Side Communications shall have the meaning assigned to such term in Section 10.01(f).
Public Siders shall have the meaning assigned to such term in Section 10.01(f).
Purchase Money Obligation shall mean, for any Person, the obligations of such Person in respect of Indebtedness (including Capital Lease Obligations) incurred for the purpose of financing all or any part of the purchase price of any fixed or Capital Assets or the cost of installation, construction or improvement of any fixed or Capital Assets and any refinancing thereof; provided, however, that (i) such Indebtedness is incurred no later than 180 days after the acquisition, installation, construction, repair, replacement, exchange or improvement of such fixed or Capital Assets by such Person, (ii) the amount of such Indebtedness (excluding any costs, expenses and fees incurred in connection therewith) does not exceed 100% of the cost of such acquisition, installation, construction or improvement, as the case may be, and (iii) the Liens granted with respect thereto do not at any time encumber any property other than the property financed by such Indebtedness (with respect to Capital Lease Obligations, the Liens granted with respect thereto do not at any time extend to or cover any assets other than the assets subject to such Capital Lease Obligations).
Qualified Capital Stock of any Person shall mean any Equity Interests of such person that are not Disqualified Capital Stock.
Qualified ECP Guarantor shall mean, in respect of any Swap Obligation, each Guarantor that has total assets exceeding $10,000,000 at the time the relevant Guarantee or grant of the relevant security interest becomes effective with respect to such Swap Obligation or such other person as constitutes an eligible contract participant under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another person to qualify as an eligible contract participant at such time by entering into a keepwell under Section la(18)(A)(v)(II) of the Commodity Exchange Act.
Qualified Securitization Financing shall mean any Securitization Facility (and any guarantee of such Securitization Facility), as amended, supplemented, extended, renewed, restated, amended and restated, refunded, refinanced, replaced or otherwise modified from time to time, that meets the following conditions: (i) the Borrower shall have determined in good faith that such Securitization Facility (including financing terms, covenants, termination events and other provisions) is in the aggregate economically fair and reasonable to the Borrower and the Restricted Subsidiaries; (ii) all sales of Securitization Assets and related assets by the Borrower or any Restricted Subsidiary to the Securitization Subsidiary or any other Person are made at fair market value or otherwise on arms length terms (as determined in good faith by the Borrower); (iii) the financing terms, covenants, termination events and other provisions thereof shall be on market terms (as determined in good faith by the Borrower); and (iv) the obligations under such Securitization Facility are non-recourse (except for Standard Securitization Undertakings) to the Borrower or any Restricted Subsidiary (other than a Securitization Subsidiary).
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Rate Charges shall have the meaning assigned to such term in Section 10,14.
Real Property shall mean, collectively, all right, title and interest (including any leasehold, mineral or other estate) in and to any and all parcels of or interests in real property owned, leased or operated by any person, whether by lease, license or other means, together with, in each case, all easements, hereditaments and appurtenances relating thereto, all improvements and appurtenant fixtures and equipment, all general intangibles and contract rights and other property and rights incidental to the ownership, lease or operation thereof.
Receivables Assets shall mean (a) any accounts receivable owed to the Borrower or a Restricted Subsidiary subject to a Receivables Facility and the proceeds thereof, (b) any bank account into which any accounts receivable owed to the Borrower or a Restricted Subsidiary subject to a Receivables Facility are to be paid and (c) all collateral securing such accounts receivable and bank accounts, all contracts and contract rights, guarantees or other obligations in respect of such accounts receivable and bank accounts, all records with respect to such accounts receivable and bank accounts and any other assets customarily transferred together with accounts receivable in connection with a non-recourse accounts receivable factoring, invoice discounting or similar arrangement and which are sold, conveyed, assigned or otherwise transferred or pledged in connection with a Receivables Facility.
Receivables Facility shall mean any of one or more receivables financing facilities (and any guarantee of any such financing facility), as amended, restated, amended and restated, supplemented, extended, renewed, refunded, refinanced, replaced or otherwise modified from time to time, the obligations of which are non-recourse (except for Standard Securitization Undertakings) to the Borrower and the Restricted Subsidiaries (other than a Receivables Subsidiary) pursuant to which the Borrower or any Restricted Subsidiary sells, directly or indirectly grants a security interest in or otherwise transfers its Receivables Assets to either (i) a Person that is not the Borrower or a Restricted Subsidiary or (ii) a Receivables Subsidiary that in turn funds such purchase by purporting to sell its accounts receivable to a Person that is not the Borrower or a Restricted Subsidiary or by borrowing from such a Person or from another Receivables Subsidiary that in turn funds itself by borrowing from such a Person.
Receivables Fee shall mean distributions or payments made directly or by means of discounts with respect to any accounts receivable or participation interest issued or sold in connection with, and other fees paid to a Person that is not the Borrower or a Restricted Subsidiary in connection with, any Receivables Facility.
Receivables Subsidiary shall mean (i) any Subsidiary formed for the purpose of facilitating or entering into one or more Receivables Facilities that engages only in activities reasonably related or incidental thereto or (ii) another Person formed for the purposes of engaging in a Receivables Facility in which any Subsidiary makes an Investment and to which any Subsidiary transfers accounts receivable and related assets.
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Recipient shall mean any Agent, any Lender and any Issuing Bank, as applicable.
Reference Date shall have the meaning assigned to such term in the definition of Cumulative Amount.
Refinanced Debt shall have the meaning assigned to such term in the definition of Credit Agreement Refinancing Indebtedness.
Refinancing Amendment shall mean an amendment to this Agreement in form and substance reasonably satisfactory to the Administrative Agent and the Borrower executed by each of (a) the Borrower, (b) the Administrative Agent and (c) each Lender and Additional Lender that agrees to provide any portion of the Credit Agreement Refinancing Indebtedness being incurred pursuant thereto.
Refinancing Revolving Loan Commitments shall mean one or more Tranches of revolving loan commitments hereunder that result from a Refinancing Amendment.
Refinancing Revolving Loans shall mean one or more Tranches of Revolving Loans that result from a Refinancing Amendment.
Refinancing Term Commitments shall mean one or more Tranches of Term Loan Commitments hereunder that result from a Refinancing Amendment.
Refinancing Term Loans shall mean one or more Tranches of Term Loans that result from a Refinancing Amendment.
Register shall have the meaning assigned to such term in Section 10.04(c).
Registered Equivalent Notes shall mean, with respect to any notes originally issued in a Rule 144A or other private placement transaction under the Securities Act of 1933, substantially identical notes (having the same guarantee obligations) issued in a dollar-for-dollar exchange therefor pursuant to an exchange offer registered with the SEC.
Regulation D shall mean Regulation D of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.
Regulation S-X shall mean Regulation S-X promulgated under the Securities Act.
Regulation T shall mean Regulation T of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.
Regulation U shall mean Regulation U of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.
Regulation X shall mean Regulation X of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.
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Reimbursement Obligations shall mean the Borrowers obligations under Section 2.18(e) to reimburse LC Disbursements once such LC Disbursements have been made.
Rejection Notice shall have the meaning assigned to such term in Section 2.10(i).
Related Parties shall mean, with respect to any Person, such Persons Affiliates and the partners, directors, officers, employees, agents, trustees, administrators, managers, advisors, attorneys and representatives of such Person and of such Persons Affiliates.
Release shall mean any spilling, leaking, seepage, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, or disposing of any Hazardous Material into the Environment.
Repricing Event shall mean, with respect to the initial Term Loans only, (i) any mandatory prepayment pursuant to Section 2.10(d) or voluntary prepayment (in each case, other than a prepayment of the initial Term Loans in connection with any transaction that would, if consummated, constitute an IPO, Change of Control or Transformative Acquisition) of the initial Term Loans with the proceeds of loans under any broadly syndicated first lien secured bank credit facilities with a lower Effective Yield than the Effective Yield of the initial Term Loans disbursed on the Closing Date or (ii) any amendment (other than in connection with any transaction that would, if consummated, constitute an IPO, Change of Control or Transformative Acquisition) that reduces the Effective Yield of the initial Term Loans disbursed on the Closing Date.
Required Debt Terms shall mean in respect of any Indebtedness, the following requirements: (i) such Indebtedness (x) does not have a maturity date or (solely in the case of any such Indebtedness in the form of notes) have any mandatory prepayment or redemption features (other than customary asset sale events, insurance and condemnation proceeds events, change of control offers or events of default, AHYDO catch-up payments and, if secured, excess cash flow sweeps), in each case prior to the date that is the then Latest Maturity Date at the time such Indebtedness is incurred and (y) solely in the case of any such Indebtedness in the form of loans, does not have a shorter Weighted Average Life to Maturity than the Term Loans; provided that (x) the limitations in this clause (i) shall not apply to any Permitted Incremental Equivalent Debt consisting of a customary bridge facility so long as the long-term debt into which such customary bridge facility is to be converted satisfies the provisions of this clause and (y) such Indebtedness in the form of notes shall have no required amortization, (ii) such Indebtedness is not guaranteed by any Persons that are not Guarantors, (iii) if such Indebtedness is secured by the Collateral, a Senior Representative acting on behalf of the holders of such Indebtedness has become party to (A) a First Lien/Second Lien Intercreditor Agreement if such Indebtedness is secured on a junior basis to the Secured Obligations or (B) an Other Intercreditor Agreement if such Indebtedness is secured on a pari passu basis with the Secured Obligations, (iv) to the extent secured, any such Indebtedness is not secured by assets not constituting Collateral, (v) any such Indebtedness that is payment subordinated shall be subject to a subordination agreement on terms that are reasonably acceptable to the Administrative Agent and the Borrower, and (vi) the terms and conditions of such Indebtedness (excluding pricing, interest rate margins, rate floors, discounts, premiums, fees, and prepayment or redemption terms and provisions which shall be
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determined by the Borrower) either, at the option of the Borrower, (A) reflect market terms and conditions (taken as a whole) at the time of incurrence, issuance or effectiveness (as determined by the Borrower in good faith) or are reasonably satisfactory to the Administrative Agent (except for covenants or other provisions applicable only to periods after the applicable Latest Maturity Date) or (B) are not materially more restrictive to Holdings and its Subsidiaries (when taken as a whole) than the terms and conditions of this Agreement (when taken as a whole) (except for covenants or other provisions applicable only to periods after the applicable Latest Maturity Date) (it being understood that (A) to the extent that any financial maintenance covenant is added for the benefit of any such Indebtedness, the terms and conditions of such Indebtedness will be deemed not to be more restrictive than the terms and conditions of this Agreement if such financial maintenance covenant is also added for the benefit of this Agreement and (B) no consent shall be required from the Administrative Agent for terms or conditions that are not market terms or are more restrictive than this Agreement if such terms are added to this Agreement); provided, further, that a certificate delivered to the Administrative Agent at least five Business Days prior to the incurrence of such Indebtedness, together with a reasonably detailed description of the material terms and conditions of such Indebtedness or drafts of the documentation relating thereto, stating that the Borrower has determined in good faith that such terms and conditions satisfy the requirements of this definition, shall be conclusive evidence that such terms and conditions satisfy the requirements of this definition unless the Administrative Agent notifies the Borrower within such five Business Day period that it disagrees with such determination (including a reasonable description of the basis upon which it disagrees).
Required Lenders shall mean Lenders having more than 50% of the sum of all Loans outstanding, LC Exposure and unused Revolving Commitments and Term Loan Commitments; provided that the Loans, LC Exposure and unused Commitments held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders; provided, further, that for any Required Lenders vote, Affiliated Debt Funds may not, in the aggregate, account for more than 49.9% of the amounts included in determining whether the Required Lenders have consented to any amendment or waiver.
Required Revolving Lenders shall mean Lenders having more than 50% of all Revolving Commitments or, after the Revolving Commitments have terminated, more than 50% of all Revolving Exposure; provided that the Revolving Commitments or Revolving Exposure held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of the Required Revolving Lenders.
Requirements of Law shall mean, collectively, all international, foreign, federal, state and local laws (including common law), judgments, decrees, statutes, treaties, rules, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, or other requirements of, any Governmental Authority, in each case whether or not having the force of law.
Resignation Effective Date shall have the meaning assigned to such term in Section 9.06(a).
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Responsible Officer of any person shall mean any executive officer (including, without limitation, the president, any vice president, secretary and assistant secretary), any authorized person or Financial Officer of such person and any other officer or similar official or authorized person thereof with responsibility for the administration of the obligations of such person in respect of this Agreement and, solely for purposes of notices given pursuant to Article II, any other officer or employee of the applicable Credit Party so designated by any of the foregoing officers in a notice to the Administrative Agent or any other officer or employee of the applicable Credit Party designated in or pursuant to an agreement between the applicable Credit Party and the Administrative Agent.
Restricted Debt Payment shall have the meaning assigned to such term in Section 6.09(a).
Restricted Subsidiary shall mean each Subsidiary of Holdings other than any Unrestricted Subsidiary.
Retained Declined Proceeds shall have the meaning assigned to such term in Section 2.10(i).
Revolving Availability Period shall mean the period from and including the Original Closing Date to but excluding the earlier of (i) the Business Day immediately preceding the Revolving Maturity Date and (ii) the date of termination of the Revolving Commitments.
Revolving Borrowing shall mean a Borrowing comprised of Revolving Loans.
Revolving Commitment shall mean, with respect to each Lender, the commitment, if any, of such Lender to make Revolving Loans hereunder up to the amount set forth on Annex A hereto or in an Increase Joinder, or in any Assignment and Assumption pursuant to which such Lender assumed its Revolving Commitment, as applicable, as the same may be (a) reduced from time to time pursuant to Section 2.07 and (b) reduced or increased from time to time pursuant to Incremental Revolving Loan Commitments or assignments by or to such Lender pursuant to Section 2.16(b), Section 10.02(f) or Section 10.04.
Revolving Commitment Increase shall have the meaning assigned to such term in Section 2.20.
Revolving Exposure shall mean, with respect to any Lender at any time, the aggregate principal amount at such time of all outstanding Revolving Loans of such Lender, plus the aggregate amount at such time of such Lenders LC Exposure, plus the aggregate amount at such time of such Lenders Swing Line Exposure.
Revolving Lender shall mean a Lender with a Revolving Commitment or that holds a Revolving Loan.
Revolving Loan shall mean a Loan made by Lenders to the Borrower pursuant to Section 2.01(b), including, unless the context shall otherwise require, any Incremental Revolving Loans made pursuant to Section 2.20 after the Closing Date.
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Revolving Maturity Date shall mean (x) with respect to any Revolving Commitments the maturity date of which has not been extended pursuant to Section 2.21, the date which is five years after the Original Closing Date or, if such date is not a Business Day, the first Business Day preceding such date and (y) with respect to any Extended Tranche of Revolving Commitments, the final maturity date specified in the applicable Extension Election accepted by the respective Lender or Lenders.
S&P shall mean Standard & Poors Ratings Service, a subsidiary of S&P Global Inc.
Sale Leaseback Transaction shall mean any arrangement, directly or indirectly, with any person whereby Holdings or any of its Restricted Subsidiaries shall sell, transfer or otherwise dispose of any property, real or personal, used or useful in its business, whether now owned or hereafter acquired, and thereafter rent or lease such property or other property that it intends to use for substantially the same purpose or purposes as the property being sold or transferred; provided that (a) no Event of Default shall have occurred and be continuing or would immediately result therefrom and (b) such Sale Leaseback Transaction is consummated within 180 days of the disposition of such property.
Sanctions shall have the meaning assigned to such term in Section 3.20.
SEC shall mean the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principal functions.
Second Lien Credit Agreement shall have the meaning assigned to such term in the preamble hereto.
Secured Cash Management Agreement shall mean any Cash Management Agreement that is entered into by and between any Credit Party or any Restricted Subsidiary and any Cash Management Bank that is designated by Holdings as a Secured Cash Management Agreement.
Secured Hedging Agreement shall mean any Hedging Agreement that is entered into by and between any Credit Party or any Restricted Subsidiary and any Hedge Bank, unless such Hedging Agreement is designated by Holdings not to be a Secured Hedging Agreement.
Secured Obligations shall mean (a) the Obligations and (b) the payment of all obligations of the Borrower and the other Credit Parties under each Secured Cash Management Agreement and Secured Hedging Agreement entered into with any counterparty that is a Secured Party; provided that, notwithstanding anything to the contrary, the Secured Obligations shall exclude any Excluded Swap Obligations.
Secured Parties shall mean, collectively, (i) the Administrative Agent, (ii) the Collateral Agent, (iii) each other Agent, (iv) the Lenders, (v) each Cash Management Bank, (vi) each Hedge Bank; and (vii) each Issuing Bank.
Securities Act shall mean the Securities Act of 1933, as amended.
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Securitization Assets shall mean (a) any accounts receivable or related assets and the proceeds thereof, in each case, subject to a Securitization Facility, (b) any bank accounts into which accounts receivable or related assets and the proceeds thereof, in each case, subject to a Securitization Facility are to be received or deposited and (c) all collateral securing such receivable, bank account or asset, all contracts and contract rights, guaranties or other obligations in respect of such receivable, bank account or assets, lockbox accounts and records with respect to such account, bank account or asset and any other assets customarily transferred (or in respect of which security interests are customarily granted), together with accounts or assets in a securitization financing and which in the case of clauses (a) and (b) above are sold, conveyed, assigned or otherwise transferred or pledged in connection with a Qualified Securitization Financing.
Securitization Facility shall mean any transaction or series of transactions that may be entered into by the Borrower or any Restricted Subsidiary pursuant to which the Borrower or such Restricted Subsidiary may sell, convey or otherwise transfer, or may grant a security interest in, Securitization Assets to either (a) a Person that is not the Borrower or a Restricted Subsidiary or (b) a Securitization Subsidiary that in turn sells such Securitization Assets to a Person that is not the Borrower or a Restricted Subsidiary, or may grant a security interest in, any Securitization Assets of the Borrower or any of its Subsidiaries.
Securitization Fees shall mean distributions or payments made directly or by means of discounts with respect to any Securitization Asset or participation interest therein issued or sold in connection with, and other fees and expenses (including reasonable fees and expenses of legal counsel) paid to a Person that is not the Borrower or a Restricted Subsidiary in connection with, any Qualified Securitization Financing.
Securitization Repurchase Obligation shall mean any obligation of a seller (or any guaranty of such obligation) of (i) Receivables Assets under a Receivables Facility to repurchase Receivables Assets or (ii) Securitization Assets in a Qualified Securitization Financing to repurchase Securitization Assets, in either case, arising as a result of a receivable or portion thereof becoming subject to any asserted defense, dispute, offset or counterclaim of any kind as a result of any action taken by, any failure to take action by, or any other event relating to, the seller or the Receivables Assets or Securitization Assets, as applicable.
Securitization Subsidiary shall mean any Subsidiary of the Borrower, in each case formed for the purpose of, and that solely engages in, one or more Qualified Securitization Financings and other activities reasonably related thereto or another Person formed for the purposes of engaging in a Qualified Securitization Financing in which the Borrower or any Restricted Subsidiary makes an Investment and to which the Borrower or such Restricted Subsidiary transfers Securitization Assets and related assets.
Security Agreement shall mean one or more security agreements by and among one or more of the Credit Parties and the Collateral Agent for the benefit of the Secured Parties with respect to Liens granted on the Collateral thereunder as security for the Secured Obligations.
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Security Agreement Collateral shall mean all property pledged or granted as collateral pursuant to a Security Agreement (a) on the Closing Date or (b) thereafter pursuant to Section 5.10 or Section 5.11 and in each case other than Excluded Property.
Security Documents shall mean the Security Agreements, the Mortgages (if any) and each other security document or pledge agreement delivered in accordance with applicable local or foreign law to grant a valid, perfected security interest in any property as collateral for the Secured Obligations, and any other document or instrument utilized to pledge or grant or purport to pledge or grant a security interest in or lien on any property as collateral for the Secured Obligations.
Senior Representative shall mean, with respect to any series of Permitted Pari Passu Refinancing Debt, Permitted Debt Exchange Notes, Senior Secured Indebtedness, Junior Secured Indebtedness, Permitted Junior Refinancing Debt, Permitted Unsecured Refinancing Debt or Permitted Incremental Equivalent Debt, the trustee, sole lender, administrative agent, collateral agent, security agent or similar agent under the indenture or agreement pursuant to which such Indebtedness is issued, incurred or otherwise obtained, as the case may be, and each of their successors in such capacities.
Senior Secured Indebtedness shall mean senior Indebtedness of the Credit Parties for borrowed money that is secured on a pari passu basis with the Secured Obligations (without regard to the control of remedies); provided that such Indebtedness shall be subject to Section 2.20(f) (as if such Indebtedness were Incremental Term Loans secured on a pari passu basis with the Secured Obligations).
Senior Secured Leverage Ratio shall mean, at any date of determination, the ratio of (i)(x) Consolidated Total Funded Indebtedness of Holdings and its Restricted Subsidiaries on such date, other than Indebtedness that is unsecured or is secured by assets other than the Collateral, minus (y) Unrestricted Cash of Holdings and its Restricted Subsidiaries on such date, to (ii) Consolidated EBITDA of for the Test Period then most recently ended.
Specified Existing Tranche shall have the meaning assigned to such term in Section 2.21(a).
Sponsor shall mean Vista Equity Partners Fund VI, L.P., Vista Equity Partners Management, LLC and their respective Controlled Investment Affiliates.
Sponsor Investor shall have the meaning assigned thereto in Section 10.04(b)(v).
Standard Securitization Undertakings shall mean representations, warranties, covenants and indemnities entered into by the Borrower or any Restricted Subsidiary that the Borrower has determined in good faith to be customary in a Securitization Facility or a Receivables Facility, including, without limitation, those relating to the servicing of the assets of a Securitization Subsidiary or a Receivables Subsidiary, it being understood that any Securitization Repurchase Obligation shall be deemed to be a Standard Securitization Undertaking.
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Standby Letter of Credit shall mean any standby letter of credit or similar instrument providing for the payment of cash upon the honoring of a presentation thereunder.
Statutory Reserves shall mean for any Interest Period for any Eurodollar Borrowing, the average maximum rate at which reserves (including any marginal, supplemental or emergency reserves) are required to be maintained during such Interest Period under Regulation D by member banks of the United States Federal Reserve System in New York City with deposits exceeding one billion dollars against Eurocurrency liabilities (as such term is used in Regulation D). Eurodollar Borrowings shall be deemed to constitute Eurocurrency liabilities and to be subject to such reserve requirements without benefit of or credit for proration, exceptions or offsets which may be available from time to time to any Lender under Regulation D.
Subject Transaction shall mean any (a) disposition of all or substantially all of the assets of or all of the Equity Interests of any Restricted Subsidiary or of any product line, business unit, line of business or division of the Borrower or any of the Restricted Subsidiaries for which historical financial statements are available, in each case to the extent otherwise permitted hereunder, (b) Permitted Acquisition, (c) other Investment that is permitted hereunder, (d) designation of any Restricted Subsidiary as an Unrestricted Subsidiary, or of any Unrestricted Subsidiary as a Restricted Subsidiary or (e) proposed incurrence of Indebtedness or making of a Dividend or a Restricted Debt Payment in respect of which compliance with any financial ratio is by the terms of this Agreement required to be calculated on a Pro Forma Basis.
Subordinated Debt Documents shall mean any agreement, indenture or instrument pursuant to which any Subordinated Indebtedness is issued, in each case as amended to the extent permitted under the Loan Documents.
Subordinated Indebtedness shall mean Indebtedness of the Borrower or any Guarantor that is by its terms subordinated in right of payment to the Obligations of the Borrower and such Guarantor, as applicable; provided that such terms of subordination and any intercreditor documentation with respect thereto are customary or reasonably acceptable to the Administrative Agent.
Subsidiary shall mean, with respect to any Person (the parent) at any date, (i) any person the accounts of which would be consolidated with those of the parents in the parents consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, (ii) any other corporation, limited liability company, association or other business entity of which securities or other ownership interests representing more than 50% of the voting power of all Equity Interests entitled (without regard to the occurrence of any contingency) to vote in the election of the Board of Directors thereof are, as of such date, owned, controlled or held by the parent and/or one or more subsidiaries of the parent, (iii) any partnership (a) the sole general partner or the managing general partner of which is the parent and/or one or more subsidiaries of the parent or (b) the only general partners of which are the parent and/or one or more subsidiaries of the parent and (iv) any other Person that is otherwise Controlled by the parent and/or one or more subsidiaries of the parent. Unless otherwise specified, references to Subsidiary or Subsidiaries herein shall refer to Subsidiaries of Holdings.
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Subsidiary Guarantor shall mean each Restricted Subsidiary of Holdings (other than the Borrower) that is, or becomes pursuant to Section 5.10, a party to this Agreement; provided that, notwithstanding anything to the contrary, no Excluded Subsidiary shall be a Subsidiary Guarantor.
Swap Obligation shall mean, with respect to any Guarantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes a swap within the meaning of section la(47) of the Commodity Exchange Act.
Swing Line Commitment shall mean the commitment of the Swing Line Lender to make loans pursuant to Section 2.17, as the same may be reduced from time to time pursuant to Section 2.07. The aggregate principal amount of the Swing Line Commitment shall be $5,000,000 on the Closing Date and the Swing Line Commitment shall in no event exceed the Revolving Commitment.
Swing Line Exposure shall mean at any time the aggregate principal amount at such time of all outstanding Swing Line Loans. The Swing Line Exposure of any Revolving Lender at any time shall equal its Pro Rata Percentage of the aggregate Swing Line Exposure at such time.
Swing Line Lender shall have the meaning assigned to such term in the preamble hereto.
Swing Line Loan shall mean any loan made by the Swing Line Lender pursuant to Section 2.17.
Tax Return shall mean all returns, statements, declarations, filings, attachments and other documents or certifications required to be filed in respect of Taxes, including any amendments thereof.
Tax Withholdings shall have the meaning assigned to such term in Section 2.15(a).
Taxes shall mean all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholdings), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.
Term Loan shall mean a Loan made by Lenders to the Borrower pursuant to Section 2.01(a) and shall include, unless the context shall otherwise require, any Incremental Term Loans made pursuant to Section 2.20 after the Closing Date.
Term Loan Borrowing shall mean a Borrowing comprised of Term Loans.
Term Loan Commitment shall mean, with respect to any Lender, (a) its obligation to make its portion of Term Loans to the Borrower in the amount set forth on Annex A, and (b) unless the context shall otherwise require, any Incremental Term Loan Commitments made pursuant to Section 2.20 after the Closing Date. The initial aggregate amount of the Term Loan Commitments as of the date hereof is $700,000,000.
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Term Loan Lender shall mean a Lender with a Term Loan Commitment or an outstanding Term Loan.
Term Loan Maturity Date shall mean (x) with respect to any Term Loans the maturity date of which has not been extended pursuant to Section 2.21, the date which is seven years after the Closing Date or, if such date is not a Business Day, the first Business Day preceding such date, and (y) with respect to any Extended Tranche of Term Loans, the final maturity date specified in the applicable Extension Election accepted by the respective Lender or Lenders.
Term Loan Repayment Date shall have the meaning assigned to such term in Section 2.09.
Test Period shall mean, at any time, subject to Section 1,06, the four consecutive fiscal quarters of Holdings then last ended (in each case taken as one accounting period) for which financial statements have been or were required to be delivered pursuant to Section 5.01(a) or (b).
Total Leverage Ratio shall mean, at any date of determination, the ratio of (i)(y) Consolidated Total Funded Indebtedness of Holdings and its Restricted Subsidiaries on such date minus (z) Unrestricted Cash of Holdings and its Restricted Subsidiaries on such date, to (ii) Consolidated EBITDA for the Test Period then most recently ended.
Tranche shall mean each tranche of Loans or Commitments available hereunder. On the Closing Date there shall be two tranches, one comprised of Term Loans and one comprised of the Revolving Loans and Revolving Commitments.
Transactions shall mean, collectively, the transactions to occur on or prior to the Closing Date to effectuate the Closing Date Refinancing pursuant to the Loan Documents; the execution, delivery and performance of the Loan Documents and the initial Borrowings hereunder; and the payment of all fees, costs and expenses to be paid on or prior to the Closing Date and owing in connection with the foregoing.
Transferred Guarantor shall have the meaning assigned to such term in Section 7.09.
Transformative Acquisition shall mean any acquisition by Holdings or any of its Restricted Subsidiaries that (a) is not permitted by the terms of this Agreement (other than any such acquisition that would be prohibited solely by Section 6.10) immediately prior to the consummation of such acquisition, (b) if permitted by the terms of this Agreement immediately prior to the consummation of such acquisition, would not provide Holdings and its Restricted Subsidiaries with adequate flexibility under this Agreement for the continuation and/or expansion of their combined operations following such consummation, as determined by the Borrower acting in good faith, and/or (c) would result in an increase in Consolidated EBITDA of $55,000,000 or more, as determined on a Pro Forma Basis for the most recently ended Test Period.
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Type when used in reference to any Loan or Borrowing, shall mean a reference to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted LIBO Rate or the Alternate Base Rate.
UCC shall mean the Uniform Commercial Code as in effect from time to time (except as otherwise specified) in any applicable state or jurisdiction.
UCP shall mean, with respect to any Letter of Credit, the Uniform Customs and Practice for Documentary Credits, International Chamber of Commerce (ICC) Publication No. 600 (or such later version thereof as may be in effect at the time of issuance).
Undisclosed Administration means in relation to a Lender or its direct or indirect parent company, the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official by a supervisory authority or regulator under or based on the law in the country where such Lender or such parent company is subject to home jurisdiction supervision, in each case to the extent applicable law requires that such appointment is not to be publicly disclosed.
United States or U.S. shall mean the United States of America.
Unreimbursed Amount shall have the meaning assigned to such term in Section 2.18(d).
Unrestricted Cash shall mean, at any time, the aggregate amount of (i) unrestricted cash and Cash Equivalents held in accounts of Holdings and its Restricted Subsidiaries (whether or not held in an account pledged to the Administrative Agent or Collateral Agent) and (ii) cash and Cash Equivalents restricted in favor of lenders under credit facilities (which shall include any cash and Cash Equivalents securing other Indebtedness secured by a Lien on Collateral along with such credit facilities (provided that any such Liens are subordinated to or pari passu with the Liens in favor of the Administrative Agent or Collateral Agent), including any Indebtedness incurred under this Agreement and the other Loan Documents (including Indebtedness incurred pursuant to Section 2.20, Section 2.21, Section 2.22 and Section 2.23 hereof); provided, further, for the avoidance of doubt, the proceeds of an Equity Cure Contribution shall not be included in this definition of Unrestricted Cash as of the last day of the fiscal quarter with respect to which such Equity Cure Contribution was made for any calculation of the First Lien Leverage Ratio, Senior Secured Leverage Ratio or Total Leverage Ratio or for purposes of determining compliance with the Financial Covenant.
Unrestricted Subsidiary shall mean (a) any Subsidiary of Holdings that is formed or acquired after the Closing Date; provided that at such time (or promptly thereafter) the Borrower designates such Subsidiary an Unrestricted Subsidiary in a notice to the Administrative Agent, (b) any Restricted Subsidiary subsequently designated as an Unrestricted Subsidiary by the Borrower in a written notice to the Administrative Agent, and (c) each Subsidiary of an Unrestricted Subsidiary; provided that in the case of clauses (a) and (b) above, (x) such designation shall be deemed to be an Investment on the date of such designation in an amount
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equal to the fair market value of the investment therein and such designation shall be permitted only to the extent permitted under Section 6.03 on the date of such designation, (y) no Event of Default shall have occurred and be continuing or would immediately result from such designation after giving pro forma effect thereto (including to the re-designation of Indebtedness and Liens on the assets of such Subsidiary as Indebtedness and Liens on assets of an Unrestricted Subsidiary), and (z) immediately after giving effect to any such designation, on a Pro Forma Basis (including, for the avoidance of doubt, giving pro forma effect to the re-designation of Indebtedness and Liens on the assets of such Subsidiary as Indebtedness and Liens on assets of an Unrestricted Subsidiary), the First Lien Leverage Ratio (determined on a Pro Forma Basis as of the Applicable Date of Determination and for the applicable Test Period) shall not exceed 4.50 to 1.00. The Borrower may, by written notice to the Administrative Agent, re-designate any Unrestricted Subsidiary as a Restricted Subsidiary (which shall constitute a reduction in any outstanding Investment), and thereafter, such Subsidiary shall no longer constitute an Unrestricted Subsidiary, but only if (a) no Event of Default would immediately result from such re-designation (including the re-designation of Indebtedness and Liens on the assets of such Subsidiary as Indebtedness and Liens on assets of a Restricted Subsidiary) and (b) immediately after giving effect to any such redesignation (including the re-designation of Indebtedness and Liens on the assets of such Subsidiary as Indebtedness and Liens on assets of a Restricted Subsidiary and the deemed return on any Investment in such Unrestricted Subsidiary pursuant to clause (y)), the First Lien Leverage Ratio (determined on a Pro Forma Basis as of the Applicable Date of Determination and for the applicable Test Period) shall not exceed 4.50 to 1.00. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute (x) the incurrence by such Restricted Subsidiary at the time of such designation of any Indebtedness or Liens of such Restricted Subsidiary outstanding at such time (after giving effect to, and taking into account, any payoff or termination of Indebtedness or any release or termination of Liens, in each case, occurring in connection or substantially concurrently therewith) and (y) constitute a return on any Investment by the Borrower in such Unrestricted Subsidiary in an amount equal to the fair market value at the date of such prior designation of such Restricted Subsidiary as an Unrestricted Subsidiary. As of the Closing Date, none of the Subsidiaries of Holdings is an Unrestricted Subsidiary, and in no event shall the Borrower or Lanyon become an Unrestricted Subsidiary.
Unsecured Indebtedness shall mean unsecured Indebtedness of the Credit Parties and their Restricted Subsidiaries for borrowed money.
Voting Stock shall mean, with respect to any person, any class or classes of Equity Interests pursuant to which the holders thereof have the general voting power under ordinary circumstances to elect at least a majority of the Board of Directors of such person.
Weighted Average Life to Maturity shall mean, when applied to any Indebtedness at any date, the number of years obtained by dividing: (i) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment by (ii) the then outstanding principal amount of such Indebtedness; provided that for purposes of determining the Weighted Average Life to Maturity of any Indebtedness or Disqualified Capital Stock that is being modified, refinanced, refunded, renewed, replaced or extended, the effects of any prepayments or amortization made on such Indebtedness or Disqualified Capital Stock prior to the date of the applicable modification, refinancing, refunding, renewal, replacement or extension shall be disregarded.
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Wholly Owned Restricted Subsidiary shall mean a Restricted Subsidiary of Holdings which is a Wholly Owned Subsidiary of Holdings, the Borrower or any Restricted Subsidiary.
Wholly Owned Subsidiary shall mean, as to any Person, (a) any corporation 100% of whose capital stock (other than directors qualifying shares or other nominal issuance in order to comply with local laws) is at the time owned by such Person and/or one or more Wholly Owned Subsidiaries of such Person and (b) any partnership, association, joint venture, limited liability company or other entity in which such Person and/or one or more Wholly Owned Subsidiaries of such Person have a 100% equity interest at such time.
Write-Down and Conversion Powers means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.
Yield shall have the meaning assigned to such term in Section 2.20(f).
Yield Differential shall have the meaning assigned to such term in Section 2.20(f).
Section 1.02 Classification of Loans and Borrowings. For purposes of this Agreement, Loans may be classified and referred to by Class (e.g., a Revolving Loan) or by Type (e.g., a Eurodollar Loan) or by Class and Type (e.g, a Eurodollar Revolving Loan). Borrowings also may be classified and referred to by Class (e.g, a Revolving Borrowing, Borrowing of Term Loans) or by Type (e.g., a Eurodollar Borrowing) or by Class and Type (e.g., a Eurodollar Revolving Borrowing).
Section 1.03 Terms Generally.
(a) The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words include, includes and including shall be deemed to be followed by the phrase without limitation. The word will shall be construed to have the same meaning and effect as the word shall. Unless the context requires otherwise (i) any definition of or reference to any Loan Document, agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, restated, amended and restated, supplemented, replaced or otherwise modified (subject to any restrictions on such amendments, supplements, replacements or modifications set forth herein), (ii) any reference herein to any person shall be construed to include such persons successors and assigns (subject to any restrictions on assignments set forth herein), (iii) the words herein, hereof and hereunder, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (iv) all references herein to Articles, Sections, Exhibits and
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Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, (v) any reference to any law or regulation herein shall refer to such law or regulation as amended, modified or supplemented from time to time, (vi) the words asset and property shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights, and (vii) all references to the knowledge of any Group Member or facts known by any Group Member shall mean actual knowledge of any Responsible Officer of such Person. Any Responsible Officer executing any Loan Document or any certificate or other document made or delivered pursuant hereto or thereto, so executes or certifies in his/her capacity as a Responsible Officer on behalf of the applicable Credit Party and not in any individual capacity.
(b) The term enforceability and its derivatives when used to describe the enforceability of an agreement shall mean that such agreement is enforceable except as enforceability may be limited by any Debtor Relief Law and by general equitable principles (whether enforcement is sought by proceedings in equity or at law).
(c) Any terms used in this Agreement that are defined in the UCC shall be construed and defined as set forth in the UCC unless otherwise defined herein; provided that to the extent that the UCC is used to define any term herein and such term is defined differently in different Articles of the UCC, the definition of such term contained in Article 9 of the UCC shall govern.
Section 1.04 Accounting Terms; GAAP; Tax Laws. Except as otherwise expressly provided herein, all financial statements to be delivered pursuant to this Agreement shall be prepared in accordance with GAAP as in effect from time to time and all terms of an accounting or financial nature shall be construed and interpreted in accordance with GAAP, as in effect on the date hereof. If at any time any change in GAAP or Tax Change (as defined below) would affect the computation of any financial ratio, standard or term set forth in any Loan Document, and the Borrower or the Required Lenders shall so request, the Administrative Agent and the Borrower shall negotiate in good faith to amend such ratio, standard or term to preserve the original intent thereof in light of such change in GAAP or Tax Change (subject to approval by the Required Lenders and the Borrower); provided that, until so amended, such ratio or requirement shall continue to be computed in accordance with GAAP immediately prior to such change therein or, in the case of a Tax Change, as if the Applicable Tax Laws immediately prior to such change therein continued to apply, and the Borrower shall provide to the Administrative Agent and the Lenders within five days after delivery of each certificate or financial report required hereunder that is affected thereby a written statement of a Financial Officer of Holdings setting forth in reasonable detail the differences (including any differences that would affect any calculations relating to the Financial Covenant as set forth in Section 6.08) that would have resulted if such financial statements had been prepared giving effect to such change; provided, further that, to the extent any such change would have a negative impact on the Borrower with respect to any ratio, financial calculation, financial reporting items or requirement computation, the Borrower may (in its sole discretion) elect to compute or report such ratio, financial calculation, financial reporting item or requirement in accordance with GAAP and/or the Applicable Tax Laws, as the case may be, as changed and accordingly, if such an election is made, the Borrower shall not be required to deliver the written statement described in the immediately preceding proviso with respect thereto. Notwithstanding anything to the contrary,
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for all purposes under this Agreement and the other Loan Documents, including negative covenants, financials covenants and component definitions, GAAP will be deemed to treat operating leases and Capital Leases in a manner consistent with their current treatment under GAAP as in effect on the Closing Date, notwithstanding any modifications or interpretive changes thereto that may occur thereafter. Tax Change means any change in the Code or any other applicable Requirement of Law that would have the effect of changing the amount of Taxes due and payable by Holdings and its Restricted Subsidiaries for any taxable period, as compared to the amount of Taxes that would have been due and payable by Holdings and its Restricted Subsidiaries for such taxable period under the Code or any other Requirements of Law as in effect immediately prior to such change; provided for avoidance of doubt, that the calculation of a change in Taxes due and payable shall take into account all changes to the Code or any other Requirements of Law. Notwithstanding any other provision contained herein, (i) all terms of an accounting or financial nature used herein shall be construed, and all computations of amounts and ratios referred to herein shall be made, without giving effect to any election under Statement of Financial Accounting Standards 159 or FASB ASC 825 (or any other financial accounting standard having a similar result or effect) to value any Indebtedness or other liabilities of Holdings or any of its Restricted Subsidiaries at fair value, as defined therein and (ii) the financial ratios and related definitions set forth in the Loan Documents shall be computed to exclude the application of Financial Accounting Standards No. 133, 150 or 123(R) or any other financial accounting standard having a similar result or effect (to the extent that the pronouncements in Financial Accounting Standards No. 123(R) result in recording an equity award as a liability on a consolidated balance sheet of Holdings and its Restricted Subsidiaries in the circumstance where, but for the application of the pronouncements, such award would have been classified as equity).
Notwithstanding anything to the contrary herein, all financial ratios and tests (including the First Lien Leverage Ratio, the Senior Secured Leverage Ratio, the Total Leverage Ratio, the Consolidated Interest Coverage Ratio and the amount of Consolidated Total Assets and Consolidated EBITDA) contained in this Agreement other than for purposes of calculating Excess Cash Flow that are calculated with respect to any Test Period during which any Subject Transaction occurs shall be calculated with respect to such Test Period and such Subject Transaction on a Pro Forma Basis. Further, if since the beginning of any such Test Period and on or prior to the date of any required calculation of any financial ratio or test (x) any Subject Transaction shall have occurred or (y) any Person that subsequently became a Restricted Subsidiary or was merged, amalgamated or consolidated with or into Holdings or any of its Restricted Subsidiaries since the beginning of such Test Period shall have consummated any Subject Transaction, then, in each case, any applicable financial ratio or test shall be calculated on a Pro Forma Basis for such Test Period as if such Subject Transaction had occurred at the beginning of the applicable Test Period (it being understood, for the avoidance of doubt, that solely for purposes of calculating quarterly compliance with Section 6.08, the date of the required calculation shall be the last day of the Test Period, and no Subject Transaction occurring thereafter shall be taken into account).
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Other than as provided in Section 1,06, for purposes of determining the permissibility of any action, change, transaction or event that by the terms of the Loan Documents requires a calculation of any financial ratio or test (including the First Lien Leverage Ratio, the Senior Secured Leverage Ratio, the Total Leverage Ratio, the Consolidated Interest Coverage Ratio and the amount of Consolidated EBITDA and Consolidated Total Assets), (x) such financial ratio or test shall be calculated at the time such action is taken, such change is made, such transaction is consummated or such event occurs, as the case may be, and no Default or Event of Default shall be deemed to have occurred solely as a result of a change in such financial ratio or test occurring after the time such action is taken, such change is made, such transaction is consummated or such event occurs, as the case may be and (y) such financial ratio or test shall be calculated (on a Pro Forma Basis if applicable) using the most recent financial statements which have been delivered by the Credit Parties in accordance with Section 5.01(a) or 5.01(b) hereof or, at the option of the Borrower, such other unaudited financial statements provided to the Administrative Agent and reasonably sufficient for determining such compliance.
Notwithstanding anything to the contrary herein, to the extent compliance with a financial ratio or test is calculated prior to the date financial statements are first delivered under Section 5.01(a) or (b), such calculation shall use the latest financial statements delivered pursuant to Section 3.04(a).
Notwithstanding anything to the contrary herein, the defined terms First Lien Leverage Ratio, Senior Secured Leverage Ratio, Total Leverage Ratio, Consolidated Interest Coverage Ratio, Consolidated Total Assets and Consolidated EBITDA when used in this Agreement or any other Loan Document shall be deemed to refer to such ratio or amount with respect to the Group unless otherwise expressly set forth herein or therein.
Section 1.05 Resolution of Drafting Ambiguities. Each party hereto acknowledges and agrees that it was represented by counsel in connection with the execution and delivery of the Loan Documents to which it is a party, that it and its counsel reviewed and participated in the preparation and negotiation hereof and thereof and that any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be employed in the interpretation hereof or thereof.
Section 1.06 Limited Condition Transaction. Notwithstanding anything to the contrary herein, for purposes of (i) measuring the relevant ratios (including the First Lien Leverage Ratio (including, without limitation, for purposes of determining pro forma compliance with the Financial Covenant as a condition to effecting any such transaction), the Senior Secured Leverage Ratio, the Total Net Leverage Ratio and the Interest Coverage Ratio) and baskets (including baskets measured as a percentage of Consolidated EBITDA or Consolidated Total Assets) with respect to the incurrence of any Indebtedness (including any Incremental Facilities and Permitted Incremental Equivalent Debt but excluding Revolving Loans (provided that, for the avoidance of doubt, the term Revolving Loans shall not, for purposes of this sentence, include loans made pursuant to any Additional Revolving Commitment) or Liens or the making of any Permitted Acquisitions or other similar Investments, Dividends, Restricted Debt Payments, Asset Sales or other sales or dispositions of assets or fundamental changes or the designation of any Restricted Subsidiaries or Unrestricted Subsidiaries, or (ii) determining compliance with representations and warranties or the occurrence of any Default or Event of Default, in the case of clauses (i) and (ii), in connection with a Limited Condition Transaction, if the Borrower has made an LCT Election with respect to such Limited Condition Transaction, the date of determination of whether any such action is permitted hereunder (including, in the case of calculating Consolidated EBITDA, the reference date for determining which Test Period shall be
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the most recently ended Test Period for purposes of making such calculation) shall be deemed to be the date the definitive agreements for (or in the case of an LCT Transaction that involves some other manner of establishing a binding obligation under local law, such other binding obligations to consummate) such Limited Condition Transaction are entered into (the LCT Test Date), and if, after giving pro forma effect to such Limited Condition Transaction and the other transactions to be entered into in connection therewith as if they had occurred (with respect to income statement items) at the beginning of, or (with respect to balance sheet items) on the last day of, the most recent Test Period ending prior to the LCT Test Date, the Group Members could have taken such action on the relevant LCT Test Date in compliance with such ratio, basket, representation and warranty, or Event of Default blocker such ratio, basket, or representation and warranty or Event of Default blocker shall be deemed to have been complied with (and no Default or Event of Default shall be deemed to have arisen thereafter with respect to such Limited Condition Transaction from any such failure to comply with such ratio, basket, or representation and warranty). For the avoidance of doubt, if the Borrower has made an LCT Election and any of the ratios, baskets, Default or Event of Default blockers or representations and warranties for which compliance was determined or tested as of the LCT Test Date would thereafter have failed to have been satisfied as a result of fluctuations in any such ratio or basket, including due to fluctuations in Consolidated EBITDA, Unrestricted Cash, Consolidated Total Funded Indebtedness or Consolidated Total Assets or otherwise, at or prior to the consummation of the relevant transaction or action, such baskets, ratios or representations and warranties will not be deemed to have failed to have been satisfied as a result of such fluctuations or otherwise. If the Borrower has made an LCT Election for any Limited Condition Transaction, then in connection with any subsequent calculation of any ratio or basket on or following the relevant LCT Test Date and prior to the earlier of (i) the date on which such Limited Condition Transaction is consummated or (ii) the date that the definitive agreement for (or in the case of an LCT Transaction that involves some other manner of establishing a binding obligation under local law, such other binding obligations to consummate) such Limited Condition Transaction is terminated or expires, or the date for redemption, repurchase, defeasance, satisfaction and discharge or repayment specified in an irrevocable notice for such Limited Condition Transaction expires or passes, in each case without consummation of such Limited Condition Transaction, any such ratio (other than the Financial Covenant under Section 6.08) or basket shall be calculated on a Pro Forma Basis assuming such Limited Condition Transaction and other transactions in connection therewith (including any incurrence of Indebtedness and the use of proceeds thereof) have been consummated.
Notwithstanding the foregoing provisions of this paragraph or any other provision of this Agreement, any unfunded Commitments outstanding at any time in respect of any individual Incremental Facility pursuant to Section 2.20 established to finance an LCT Transaction may be terminated only by the lenders holding more than 50% of the aggregate amount of the Commitments in respect of such Incremental Facility (or by the Administrative Agent acting at the request of such Lenders), and not, for the avoidance of doubt, automatically or by the Required Lenders or any other Lenders (or by the Administrative Agent acting at the request of the Required Lenders or any other Lenders).
Section 1.07 Times of Day. Unless otherwise specified, all references herein to times of day shall be references to New York City time.
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Section 1.08 Deliveries. Notwithstanding anything herein to the contrary, whenever any document, agreement or other item is required by any Loan Document to be delivered or completed on a day that is not a Business Day, the due date thereof shall be extended to the next succeeding Business Day.
Section 1.09 Schedules and Exhibits. All of the schedules and exhibits attached to this Agreement shall be deemed incorporated herein by reference.
Section 1.10 Currency Generally. For purposes of determining compliance with Section 6.01, 6,02, 6,03, 6,04, 6,05, 6,06, 6,07 or 6,09, with respect to any Indebtedness, Liens, Investments, liquidations, dissolutions, mergers, consolidations, Asset Sales or other dispositions, Dividends, affiliate transactions or Restricted Debt Payments in a currency other than Dollars, no Default or Event of Default shall be deemed to have occurred solely as a result of changes in rates of currency exchange occurring after the time Holdings or one of its Restricted Subsidiaries shall (or, solely in connection with a Limited Condition Transaction, shall enter into a contractual obligation to) incur, enter into, make or acquire such Indebtedness, Liens, Investments, liquidations, dissolutions, mergers, consolidations, Asset Sales or other dispositions, Dividends, affiliate transactions or Restricted Debt Payments (so long as, at the time of incurring, entering into, making or acquiring (or, solely in connection with a Limited Condition Transaction, at the time of entering into the contract to incur, enter into, make or acquire) such Indebtedness, Liens, Investments, liquidations, dissolutions, mergers, consolidations, Asset Sales or other dispositions, Dividends, affiliate transactions or Restricted Debt Payments, such transaction was permitted hereunder) and once incurred, entered into, made or acquired (or, solely in connection with a Limited Condition Transaction, contractually obligated to be incurred, entered into, made or acquired), the amount of such Indebtedness, Liens, Investments, liquidations, dissolutions, mergers, consolidations, Asset Sales or other dispositions, Dividends, affiliate transactions or Restricted Debt Payments, shall be always deemed to be at the Dollar amount on such date, regardless of later changes in currency exchange rates.
Section 1.11 Basket Amounts and Application of Multiple Relevant Provisions. Notwithstanding anything to the contrary, (a) unless specifically stated otherwise herein, any dollar, number, percentage or other amount available under any carve-out, basket, exclusion or exception to any affirmative, negative or other covenant in this Agreement or the other Loan Documents may be accumulated, added, combined, aggregated or used together by any Credit Party and its Subsidiaries without limitation for any purpose not prohibited hereby, and (b) any action or event permitted by this Agreement or the other Loan Documents need not be permitted solely by reference to one provision permitting such action or event but may be permitted in part by one such provision and in part by one or more other provisions of this Agreement and the other Loan Documents. For purposes of determining compliance with Article VI, in the event that any Lien, Investment, liquidation, dissolution, merger, consolidation, Indebtedness (whether at the time of incurrence or upon application of all or a portion of the proceeds thereof), disposition, Dividend, Affiliate transaction, contractual requirement or prepayment of Indebtedness meets the criteria of one, or more than one, of the baskets or categories of transactions then permitted pursuant to any clause or subsection of Article VI, such transaction (or any portion thereof) at any time shall be permitted under one or more of such baskets or categories at the time of such transaction or any later time from time to time, in each case, as
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determined by the Borrower in its sole discretion at such time and thereafter may be reclassified or divided among such baskets or categories (as if incurred at such later time) by the Borrower in any manner not expressly prohibited by this Agreement, and such Lien, Investment, liquidation, dissolution, merger, consolidation, Indebtedness, disposition, Dividend, Affiliate transaction, contractual requirement or prepayment of Indebtedness (or any portion thereof) shall be treated as having been incurred or existing pursuant to only such basket or category of transactions or baskets or categories of transactions (or any portion thereof) without giving pro forma effect to such item (or portion thereof) when calculating the amount of Liens, Investments, liquidations, dissolutions, mergers, consolidations, Indebtedness, dispositions, Dividends, Affiliate transactions, contractual requirements or prepayments of Indebtedness, as applicable, that may be incurred pursuant to any other basket or category of transactions.
For the avoidance of doubt, with respect to any amounts incurred or transactions entered into (or consummated) in reliance on a provision of the Loan Documents (including, for the avoidance of doubt, the Fixed Incremental Amount) under a specific covenant that does not require compliance with a financial ratio or test (including a test based on the Consolidated Interest Coverage Ratio, the First Lien Leverage Ratio, the Senior Secured Leverage Ratio and/or the Total Leverage Ratio) (any such amounts, the Fixed Amounts) substantially concurrently with any amounts incurred or transactions entered into (or consummated) in reliance on a provision of the Loan Documents (including, for the avoidance of doubt, the Incurrence Ratio) under the same covenant that requires compliance with a financial ratio or test (including a test based on the Consolidated Interest Coverage Ratio, the First Lien Leverage Ratio, the Senior Secured Leverage Ratio and/or the Total Leverage Ratio) (any such amounts, the Incurrence-Based Amounts), it is understood and agreed that (a) the Fixed Amounts shall be disregarded in the calculation of the financial ratio or test applicable to the Incurrence-Based Amounts, and (b) except as provided in clause (a), pro forma effect shall be given to the entire transaction. In addition, for the avoidance of doubt, any Indebtedness (and associated Liens, subject to the applicable priorities required pursuant to the applicable Incurrence-Based Amounts), Investments, liquidations, dissolutions, mergers, consolidations, Dividends, or any prepayments of Indebtedness incurred or otherwise effected in reliance on Fixed Amounts may be reclassified at any time, as the Borrower may elect from time to time, as incurred under the applicable Incurrence-Based Amounts if the Borrower subsequently meets the applicable ratio for such Incurrence-Based Amounts on a pro forma basis.
Section 1.12 Letter of Credit Amounts. Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided, however, that with respect to any Letter of Credit that, by its terms or the terms of any LC Request or other letter of credit application related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such times.
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ARTICLE II
THE CREDITS
Section 2.01 Commitments. Subject to the terms and conditions herein set forth, each Lender agrees, severally and not jointly:
(a) Term Loans. To make a Term Loan to the Borrower on the Closing Date in the principal amount of its Term Loan Commitment; provided that the initial Lender shall be deemed to have satisfied its obligation to make Term Loans on the Closing Date pursuant to this Section 2.01 (and Borrower shall be deemed to have issued Term Loans on the Closing Date in the amount identified on Schedule 2.01 as having been made in respect of cashless roll elections) in respect of Term Loans under the Existing First Lien Credit Agreement for which the applicable Term Loan Lender under the Existing First Lien Credit Agreement made a cashless roll election pursuant to that certain letter agreement entitled Cashless Settlement of Existing Term Loans dated November 29, 2017 and which existing Term Loans are therefore are not repaid on the Closing Date; and
(b) Revolving Loans. To make Revolving Loans to the Borrower at any time and from time to time on or after the Closing Date until the earlier of the Revolving Maturity Date and the termination of the Revolving Commitment of such Lender in accordance with the terms hereof, in an aggregate principal amount at any time outstanding that will not result in such Lenders Revolving Exposure exceeding such Lenders Revolving Commitment.
Amounts paid or prepaid in respect of Term Loans may not be reborrowed. Within the limits set forth in clause (b) above and subject to the terms, conditions and limitations set forth herein, the Borrower may borrow, pay or prepay and reborrow Revolving Loans.
Section 2.02 Loans.
(a) Each Loan (other than Swing Line Loans) shall be made as part of a Borrowing consisting of Loans made by the applicable Lenders ratably in accordance with their applicable Commitments; provided that the failure of any Lender to make its Loan shall not in itself relieve any other Lender of its obligation to lend hereunder (it being understood, however, that no Lender shall be responsible for the failure of any other Lender to make any Loan required to be made by such other Lender). Except for Loans deemed made pursuant to Section 2.18(e)(ii) and Swing Line Loans, (x) ABR Loans comprising any Borrowing shall be in an aggregate principal amount that is (i) an integral multiple of $100,000 and not less than the Minimum Borrowing Amount or (ii) equal to the remaining available balance of the applicable Commitments and (y) the Eurodollar Loans comprising any Borrowing shall be in an aggregate principal amount that is (i) an integral multiple of $100,000 and not less than the Minimum Borrowing Amount or (ii) equal to the remaining available balance of the applicable Commitments.
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(b) Subject to Sections 2,11 and 2,12, each Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as the Borrower may request pursuant to Section 2.03. Each Lender may at its option make any Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of the Borrower to repay such Loan in accordance with the terms of this Agreement. More than one Borrowing may be incurred on any day, but at no time shall there be outstanding more than, in the case of Loans maintained as Eurodollar Loans, ten Borrowings of such Loans in the aggregate. For purposes of the foregoing, Borrowings having different Interest Periods, regardless of whether they commence on the same date, shall be considered separate Borrowings.
(c) Except with respect to Loans deemed made pursuant to Section 2.18(e)(ii), Swing Line Loans and Loans made on the Closing Date, each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds to such account as the Administrative Agent may designate not later than 1:00 p.m. New York City time, and following receipt of all funds expected to be received, the Administrative Agent shall promptly credit the amounts so received to an account as directed by the Borrower in the applicable Borrowing Request or, if a Borrowing shall not occur on such date because any condition precedent herein specified shall not have been met, return the amounts so received to the respective Lenders. The Swing Line Lender shall make each Swing Line Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds not later than 3:00 p.m., New York City time in the manner specified in Section 2.17(b).
(d) Unless the Administrative Agent shall have received notice from a Lender prior to the date (in the case of any Eurodollar Borrowing), and at least two hours prior to the time (in the case of any ABR Borrowing), of any Borrowing that such Lender will not make available to the Administrative Agent such Lenders portion of such Borrowing, the Administrative Agent may assume that such Lender has made such portion available to the Administrative Agent at the time of such Borrowing in accordance with clause (c) above, and the Administrative Agent may, in its sole discretion, in reliance upon such assumption, make available to the Borrower on such date a corresponding amount. If the Administrative Agent shall have so made funds available, then, to the extent that such Lender shall not have made such portion available to the Administrative Agent, each of such Lender and the Borrower severally agrees to repay to the Administrative Agent forthwith on demand such corresponding amount together with interest thereon, for each day from the date such amount is made available to the Borrower until the date such amount is repaid to the Administrative Agent at (i) in the case of the Borrower, the interest rate applicable at the time to the Loans comprising such Borrowing and (ii) in the case of such Lender, the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation. If such Lender shall repay to the Administrative Agent such corresponding amount, such amount shall constitute such Lenders Loan as part of such Borrowing for the purposes of this Agreement, and the Borrowers obligation to repay the Administrative Agent such corresponding amount pursuant to this Section 2.02(d) shall cease.
(e) Notwithstanding any other provision of this Agreement, the Borrower shall not be entitled to request, or to elect to convert or continue, any Borrowing if the Interest Period requested with respect thereto would end after the Revolving Maturity Date or the Term Loan Maturity Date, as applicable.
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Section 2.03 Borrowing Procedure. To request a Revolving Borrowing or Term Loan Borrowing, the Borrower shall deliver, by hand delivery, facsimile or email, a duly completed and executed Borrowing Request to the Administrative Agent (i) in the case of a Eurodollar Borrowing, not later than 2:00 p.m., New York City time (or such later time on such Business Day as may be reasonably acceptable to the Administrative Agent), three Business Days before the date of the proposed Borrowing (or, in the case of Eurodollar Borrowings that are Term Loan Borrowings to be made on the Closing Date, not later than 12:00 p.m., New York City time, one Business Day before the date of the proposed Borrowing) or (ii) in the case of an ABR Borrowing, not later than 12:00 noon., New York City time (or such later time on such Business Day as may be reasonably acceptable to the Administrative Agent), on the Business Day prior to the proposed Borrowing. Each Borrowing Request shall be irrevocable and shall specify the following information in compliance with Section 2.02:
(a) whether the requested Borrowing is to be a Borrowing of Revolving Loans or Term Loans;
(b) the aggregate amount of such Borrowing;
(c) the date of such Borrowing, which shall be a Business Day;
(d) whether such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;
(e) in the case of a Eurodollar Borrowing, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term Interest Period;
(f) the location and number of the account to which funds are to be disbursed; and
(g) with respect to each Credit Extension, that the conditions set forth in Section 4.02(b) and Section 4.02(c) will be satisfied or waived as of the date the requested Borrowing is made.
If no election as to the Type of Borrowing is specified, then the requested Borrowing shall be a Eurodollar Borrowing with an Interest Period of one months duration. If the Borrower requests a Eurodollar Borrowing but fails to specify an Interest Period, the Borrower will be deemed to have specified an Interest Period of one months duration. Promptly following receipt of a Borrowing Request in accordance with this Section, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lenders Loan to be made as part of the requested Borrowing.
Section 2.04 Evidence of Debt; Repayment of Loans.
(a) Promise to Repay. The Borrower unconditionally promises to pay to the Administrative Agent (i) for the account of each Term Loan Lender, the principal amount of each Term Loan of such Term Loan Lender as provided in Section 2.09, (ii) for the account of each Revolving Lender, the then unpaid principal amount of each Revolving Loan of such Revolving Lender on the Revolving Maturity Date, and (iii) for the account of the Swing Line Lender, the then unpaid principal amount of each Swing Line Loan on the earlier of the Revolving Maturity Date and the date ten Business Days after such Swing Line Loan is made.
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(b) Lender and Administrative Agent Records. Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the Indebtedness of the Borrower to such Lender resulting from each Loan made by such Lender from time to time, including the amounts of principal and interest payable and paid to such Lender from time to time under this Agreement. The Administrative Agent shall maintain accounts in which it will record (i) the amount of each Loan made hereunder, the Type and Class thereof and the Interest Period applicable thereto; (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each Lender hereunder; and (iii) the amount of any sum received by the Administrative Agent hereunder for the account of the Lenders and each Lenders share thereof. The entries made in the accounts maintained pursuant to this paragraph shall be prima facie evidence of the existence and amounts of the obligations therein recorded; provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligations of the Borrower to repay the Loans in accordance with their terms. In the event of any conflict between the records maintained by any Lender and the records of the Administrative Agent in respect of such matters, the records of the Administrative Agent shall control in the absence of manifest error.
(c) Promissory Notes. Any Lender by written notice to the Borrower (with a copy to the Administrative Agent) may request that Loans of any Class made by it be evidenced by a promissory note. In such event, the Borrower shall prepare, execute and deliver to such Lender a promissory note payable to such Lender or its registered assigns in the form of Exhibit H-l, H-2 or H-3, as the case may be. Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times (including after assignment pursuant to Section 10.04) be represented by one or more promissory notes in such form payable to the payee named therein or its registered assigns.
Section 2.05 Fees.
(a) Commitment Fee. The Borrower agrees to pay to the Administrative Agent for the account of each Revolving Lender (subject to Section 2.19, in the case of a Defaulting Lender) a commitment fee (a Commitment Fee) equal to the applicable percentage set forth in the definition of Applicable Margin per annum on the actual daily unused amount of the Revolving Commitment of such Revolving Lender during the period from and including the Closing Date to but excluding the date on which such Revolving Commitment terminates. Accrued Commitment Fees shall be payable in arrears (A) on the last Business Day of each March, June, September and December of each year, commencing on the first such date to occur after the Closing Date, and (B) on the date on which such Commitment terminates. Commitment Fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day). For purposes of computing Commitment Fees with respect to Revolving Commitments, a Revolving Commitment of a Revolving Lender shall be deemed to be used to the extent of the outstanding Revolving Loans and LC Exposure of such Revolving Lender; provided that for the purpose of calculations and payments pursuant to this Section 2.05, the Revolving Commitment of each Defaulting Lender shall be deemed equal to $0.
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(b) Administrative Agent Fees. The Borrower agrees to pay to the Administrative Agent, for its own account, the administrative fees payable in the amounts and at the times separately agreed upon between the Borrower and the Administrative Agent (the Administrative Agent Fee).
(c) LC Participation Fees. The Borrower agrees to pay to the Administrative Agent for the account of each Revolving Lender a participation fee (LC Participation Fee), with respect to its participations in Letters of Credit, which shall accrue at a rate equal to the Applicable Margin from time to time for LC Participation Fees on the actual daily amount of such Lenders LC Exposure (excluding any portion thereof attributable to Reimbursement Obligations) during the period from and including the Closing Date to but excluding the later of the date on which such Lenders Revolving Commitment terminates and the date on which such Lender ceases to have any LC Exposure. Accrued LC Participation Fees shall be payable in arrears (i) on the last Business Day of each March, June, September and December of each year, commencing on the first such date to occur after the Closing Date, and (ii) on the date on which the Revolving Commitments terminate (or, if later, when the Lenders obligations (in their capacities as such) in respect of all Letters of Credit have been terminated). Any such fees accruing after the date on which the Revolving Commitments terminate shall be payable promptly on written demand. All LC Participation Fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day). For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1,12.
(d) Fronting Fees. The Borrower agrees to pay to the Administrative Agent on behalf of the applicable Issuing Bank a fronting fee (Fronting Fee), which shall accrue at 0.125% on the actual daily amount of the LC Exposure (excluding any portion thereof attributable to Reimbursement Obligations) during the period from and including the Closing Date to but excluding the later of the date of termination of the Revolving Commitments and the date on which there ceases to be any LC Exposure, as well as such Issuing Banks reasonable customary fees with respect to the issuance, amendment, renewal or extension of any Letter of Credit or processing of drawings thereunder. Accrued Fronting Fees shall be payable in arrears (i) on the last Business Day of each March, June, September and December of each year, commencing on the first such date to occur after the Closing Date, and (ii) on the date on which the Revolving Commitments terminate (or, if later, when all Letters of Credit of such Issuing Bank have been terminated). Any such fees accruing after the date on which the Revolving Commitments terminate shall be payable promptly on written demand. Any other fees payable to the Issuing Bank pursuant to this paragraph shall be payable within ten Business Days after written demand therefor. All Fronting Fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day). For purposes of computing the daily amount available to be drawn under any Letter of Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.12.
(e) Fee Letters. Without duplication of any other fees set forth in this Section 2.05, the Borrower agrees to pay the fees set forth in the Fee Letters at the times and in the manner set forth therein.
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(f) All Fees shall be paid on the dates due, in Dollars in immediately available funds, to the Administrative Agent for distribution, if and as appropriate, among the applicable Lenders. Once paid when due and payable, none of the Fees shall be refundable under any circumstances.
Section 2.06 Interest on Loans.
(a) ABR Loans. Subject to the provisions of Section 2.06(c), the Loans comprising each ABR Borrowing, including each Swing Line Loan, shall bear interest at a rate per annum equal to the Alternate Base Rate plus the Applicable Margin in effect from time to time.
(b) Eurodollar Loans. Subject to the provisions of Section 2.06(c), the Loans comprising each Eurodollar Borrowing shall bear interest at a rate per annum equal to the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the Applicable Margin in effect from time to time.
(c) Default Rate. Notwithstanding the foregoing, upon the occurrence and during the existence of an Event of Default under Sections 8.01(a), (b), (g) or (h), the overdue Obligations shall bear interest, at a per annum rate equal to (i) in the case of principal on any Loan, 2.00% plus the rate otherwise applicable to such Loan as provided in Section 2.06(a) and Section 2.06(b) or (ii) in the case of any other such Obligations, 2.00% plus the rate applicable to ABR Loans as provided in Section 2.06(a) (in either case, the Default Rate).
(d) Interest Payment Dates. Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan; provided that (i) additional interest accrued pursuant to Section 2.06(c) shall be payable on written demand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Loan without a permanent reduction in Revolving Commitments or Swing Line Commitments), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.
(e) Interest Calculation. All interest hereunder shall be computed on the basis of a year of 360 days, except that interest computed by reference to the Base Rate in clause (a) of the definition of Alternate Base Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year), and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day). The applicable Alternate Base Rate or Adjusted LIBO Rate shall be determined by the Administrative Agent in accordance with the provisions of this Agreement and such determination shall be deemed presumptively correct absent manifest error.
Section 2.07 Termination and Reduction of Commitments.
(a) Termination of Commitments. The Term Loan Commitments shall automatically terminate at 5:00 p.m., New York City time (or such later time as may be reasonably determined by the Administrative Agent), on the Closing Date. The Revolving Commitments, the Swing Line Commitments and the LC Commitment shall automatically terminate on the Revolving Maturity Date.
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(b) Optional Terminations and Reductions. At its option, the Borrower may at any time terminate, or from time to time, without premium or penalty (except as provided in Section 2.13 with respect to any concurrent prepayment of Revolving Loans), permanently reduce, the Commitments of any Class; provided that (i) each reduction of the Commitments of any Class shall be in an amount that is an integral multiple of $100,000 and not less than $250,000 and (ii) the Revolving Commitments shall not be terminated or reduced if, after giving effect to any concurrent prepayment of the Revolving Loans in accordance with Section 2.10, the aggregate amount of Revolving Exposures would exceed the aggregate amount of Revolving Commitments.
(c) Borrower Notice. The Borrower shall notify the Administrative Agent in writing in substantially the form attached as Exhibit C-2, of any election to terminate or reduce the Commitments under Section 2.07(b) by 12:00 p.m. New York City time at least one Business Day (or, in the case of a prepayment of Eurodollar Loans, three Business Days) (or in each case such shorter period as the Administrative Agent may agree in its sole discretion) prior to the effective date of such termination or reduction, specifying such election and the effective date thereof. Promptly following receipt of any such notice, the Administrative Agent shall advise the applicable Lenders of the contents thereof. Each notice delivered by the Borrower pursuant to this Section shall be irrevocable; provided that a notice of termination of the Commitments delivered by the Borrower may state that such notice is conditioned upon the effectiveness of any other credit facilities or the closing of any securities offering, or the occurrence of any other event specified therein, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied. With respect to the effectiveness of any such other credit facilities or the closing of any such securities offering, the Borrower may extend the date of termination at any time with the consent of the Administrative Agent (which consent shall not be unreasonably withheld or delayed). Any termination or reduction of the Commitments of any Class shall be permanent. Each reduction of the Commitments of any Class shall be made ratably among the Lenders in accordance with their respective Commitments of such Class.
Section 2.08 Interest Elections.
(a) Generally. Each Revolving Borrowing and Term Loan Borrowing initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a Eurodollar Borrowing, shall have an initial Interest Period as specified in such Borrowing Request. Thereafter, the Borrower may elect to convert such Borrowing to a different Type or to continue such Borrowing and, in the case of a Eurodollar Borrowing, may elect Interest Periods therefor, all as provided in this Section 2.08. The Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing. This Section 2.08 shall not apply to Swing Line Borrowings, which may not be converted or continued.
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(b) Interest Election Notice. To make an election pursuant to this Section, the Borrower shall deliver, by hand delivery, facsimile or email, a duly completed and executed Interest Election Request to the Administrative Agent not later than the time that a Borrowing Request would be required under Section 2.03 if the Borrower were requesting a Revolving Borrowing or Term Loan Borrowing of the Type resulting from such election to be made on the effective date of such election. Each Interest Election Request shall be irrevocable. Each Interest Election Request shall specify the following information in compliance with Section 2.02:
(i) the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, or if outstanding Borrowings are being combined, allocation to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below, as applicable, shall be specified for each resulting Borrowing);
(ii) the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;
(iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing; and
(iv) if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term Interest Period.
If any such Interest Election Request requests a Eurodollar Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one months duration.
Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender of the details thereof and of such Lenders portion of each resulting Borrowing.
(c) Automatic Conversion. If an Interest Election Request with respect to a Eurodollar Borrowing is not timely delivered prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid or prepaid as provided herein, at the end of such Interest Period such Borrowing shall be continued as a Eurodollar Borrowing with an Interest Period of one months duration. Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing, the Administrative Agent or the Required Lenders may require, by notice to the Borrower, that (i) no outstanding Borrowing may be converted to or continued as a Eurodollar Borrowing, and (ii) unless repaid or prepaid, each Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the Interest Period applicable thereto.
Section 2.09 Amortization of Term Loan Borrowings. The Borrower shall pay to the Administrative Agent, for the ratable account of the Term Loan Lenders, on the last Business Day of each March, June, September and December, commencing with the last Business Day of June 2018 (each such date, a Term Loan Repayment Date), an amount equal to one quarter of one percent (0.25%) of the original principal amount of such Term Loans made
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on the Closing Date, as adjusted from time to time pursuant to Section 2.10(h), as reduced by the principal amount of Loans contributed or assigned to Holdings or any of its Restricted Subsidiaries pursuant to Section 10.04(b)(vi) or (viii), and as adjusted in connection with the making of any Incremental Term Loans pursuant to Section 2.20 hereof, together in each case with accrued and unpaid interest on the principal amount to be paid to but excluding the date of such payment. To the extent not previously paid, all Term Loans made on the Closing Date shall be due and payable by the Borrower on the Term Loan Maturity Date.
Section 2.10 Optional and Mandatory Prepayments of Loans.
(a) Optional Prepayments. The Borrower shall have the right at any time and from time to time to prepay Revolving Loans and Term Loans, without premium or penalty (except as and to the extent provided in Section 2.10(i) or Section 2.13), subject to the requirements of this Section 2.10; provided that (i) each prepayment of Eurodollar Loans shall be in an aggregate principal amount that is an integral multiple of $100,000 and not less than $250,000 or, if less, the entire principal amount thereof then outstanding and (ii) each prepayment of ABR Loans shall be in an aggregate principal amount that is an integral multiple of $100,000 and not less than $250,000 or, if less, the entire principal amount thereof then outstanding.
(b) Revolving Loan Prepayments.
(i) In the event of the termination of all of the Revolving Commitments in accordance with the terms hereof, the Borrower shall, on the date of such termination, repay or prepay all of its outstanding Revolving Borrowings and Swing Line Loans and, at the Borrowers option, (x) cash collateralize all outstanding Letters of Credit in accordance with the procedures set forth in Section 2.18(i), (y) backstop all outstanding Letters of Credit with one or more back to back letters of credit in a manner reasonably acceptable to the applicable Issuing Bank or (z) roll all outstanding Letters of Credit into another credit facility to the sole satisfaction of the applicable Issuing Bank.
(ii) In the event of any partial reduction of the Revolving Commitments in accordance with the terms hereof, then (x) at or prior to the effective date of such reduction, the Administrative Agent shall notify the Borrower and the Revolving Lenders of the sum of the Revolving Exposures after giving effect thereto and (y) if the sum of the Revolving Exposures would exceed the aggregate amount of Revolving Commitments after giving effect to such reduction, then the Borrower shall, on the date of such reduction, first, repay or prepay Swing Line Loans, second, repay or prepay Revolving Borrowings and third, at the Borrowers option, (1) cash collateralize outstanding Letters of Credit in accordance with the procedures set forth in Section 2.18(i), (2) backstop outstanding Letters of Credit with one or more back to back letters of credit in a manner reasonably acceptable to the applicable Issuing Bank or (3) roll outstanding Letters of Credit into another credit facility to the sole satisfaction of the applicable Issuing Bank, in an aggregate amount sufficient to eliminate such excess.
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(iii) In the event that the sum of all Lenders Revolving Exposures exceeds the Revolving Commitments then in effect, the Borrower shall, without notice or demand, immediately first, repay or prepay Swing Line Loans, second, repay or prepay Revolving Borrowings, and third, at the Borrowers option, (1) cash collateralize outstanding Letters of Credit in accordance with the procedures set forth in Section 2.18(i), (2) backstop outstanding Letters of Credit with one or more back to back letters of credit in a manner reasonably acceptable to the applicable Issuing Bank or (3) roll outstanding Letters of Credit into another credit facility to the sole satisfaction of the applicable Issuing Bank, in an aggregate amount sufficient to eliminate such excess.
(iv) In the event that at any time the aggregate LC Exposure exceeds the LC Sublimit then in effect, the Borrower shall, without notice or demand, immediately, at the Borrowers option, (1) cash collateralize outstanding Letters of Credit in accordance with the procedures set forth in Section 2.18(i), (2) backstop outstanding Letters of Credit with one or more back to back letters of credit in a manner reasonably acceptable to the applicable Issuing Bank or (3) roll outstanding Letters of Credit into another credit facility to the sole satisfaction of the applicable Issuing Bank, in an aggregate amount sufficient to eliminate such excess.
(c) Asset Sales. Not later than ten Business Days following the receipt of any Net Cash Proceeds of any Asset Sale by any Group Member (other than any issuance or sale of Equity Interests to or from Holdings, the Borrower or a Subsidiary Guarantor), the Borrower shall apply an aggregate amount equal to 100% of such Net Cash Proceeds to make prepayments in accordance with Section 2.10(h) and Section 2.10(i); provided that:
(i) no such prepayment shall be required under this clause (c) (A) with respect to any disposition of property which constitutes a Casualty Event or (B) to the extent the Net Cash Proceeds of any Asset Sales or series of related Asset Sales do not result in more than $7,500,000 per Asset Sale or series of related Asset Sales or an aggregate amount of Net Cash Proceeds of more than $14,500,000 in any twelve month period (the Asset Sale Threshold and the Net Cash Proceeds in excess of the Asset Sale Threshold, the Excess Net Cash Proceeds);
(ii) such proceeds with respect to any such Asset Sale shall not be required to be so applied on such date to the extent that the Borrower shall have notified the Administrative Agent on or prior to such date stating that such Excess Net Cash Proceeds are expected to be reinvested in assets used or useful in the business of any Group Member (including pursuant to a Permitted Acquisition, Investment or Capital Expenditure) or to be contractually committed to be so reinvested, within 18 months (or within 24 months following receipt thereof if a contractual commitment to reinvest is entered into within 18 months following receipt thereof) following the date of such Asset Sale; and
(iii) if all or any portion of such Excess Net Cash Proceeds that are subject of clause (ii) immediately above is neither reinvested nor contractually committed to be so reinvested within such 18 month period (and actually reinvested within 24 months of the receipt of the Net Cash Proceeds related thereto), such unused portion shall be applied within five Business Days after the last day of such period as a mandatory prepayment as provided in this Section 2.10(c).
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(d) Debt Issuance. Not later than one Business Day following the receipt of any Net Cash Proceeds of any Debt Issuance by any Group Member (or concurrently with the receipt thereof in the case of a Debt Issuance pursuant to Section 2.22), the Borrower shall make prepayments in accordance with Section 2.10(h) and (i) in an aggregate principal amount equal to 100% of such Net Cash Proceeds.
(e) Casualty Events. Not later than ten Business Days following the receipt of any Net Cash Proceeds from a Casualty Event by any Group Member, the Borrower shall apply an amount equal to 100% of such Net Cash Proceeds to make prepayments in accordance with Section 2.10(h) and (i); provided that
(i) such Net Cash Proceeds shall not be required to be so applied on such date to the extent that (A) such Net Cash Proceeds shall be less than $7,500,000 per Casualty Event or an aggregate amount of Net Cash Proceeds are less than $14,500,000 in any twelve month period (the Casualty Event Threshold), or (B) in the event that such Net Cash Proceeds exceed the Casualty Event Threshold, the Borrower shall have notified the Administrative Agent on or prior to such date stating that such proceeds in excess of the Casualty Event Threshold are expected to be (x) used to repair, replace or restore any Property in respect of which such Net Cash Proceeds were paid or to reinvest in other fixed or Capital Assets or assets that are otherwise used or useful in the business of the Group Members (including pursuant to a Permitted Acquisition, Investment or Capital Expenditure), or (y) contractually committed to be so reinvested, in each case, no later than 18 months (or within 24 months following receipt thereof if such contractual commitment to reinvest has been entered into within 18 months following receipt thereof) following the date of receipt of such proceeds; and
(ii) if all or any portion of such Net Cash Proceeds is contractually committed within such 18 month period to be so reinvested within such 24 month period but is not actually reinvested within 24 months of the receipt of the Net Cash Proceeds related thereto, such unused portion shall be applied within ten Business Days after the last day of such period as a mandatory prepayment as provided in this Section 2.10(e).
(f) Excess Cash Flow. No later than ten Business Days after the date on which the financial statements with respect to each fiscal year of Holdings, commencing with the first full fiscal year ending after the Closing Date, in which an Excess Cash Flow Period occurs are required to be delivered pursuant to Section 5.01(a) (each such date, an ECF Payment Date), the Borrower shall, if and to the extent Excess Cash Flow for such Excess Cash Flow Period exceeds $7,500,000, make prepayments of Term Loans in accordance with Section 2.10(h) and (i) in an aggregate amount equal to (A) the Applicable ECF Percentage of the amount equal to (x) Excess Cash Flow for the Excess Cash Flow Period then ended (for the avoidance of doubt, including the $7,500,000 floor referenced above) minus (y) $7,500,000 minus (B) at the option of the Borrower, the aggregate principal amount of (x) any Term Loans, Incremental Term Loans, Permitted Incremental Equivalent Debt, Senior Secured Indebtedness, Junior Secured Indebtedness, Revolving Loans or Incremental Revolving Loans, in each case secured on a pari passu basis with the Obligations or on a junior basis to the Secured Obligations (but not on a junior basis to any such Indebtedness that is itself secured on a junior basis to the Secured Obligations) (or, in each case, any Credit Agreement Refinancing Indebtedness or
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Permitted Refinancing in respect thereof or Permitted Debt Exchange Notes issued in exchange therefor, in each case, to the extent secured on secured on a pari passu basis with the Obligations or on a junior basis to the Secured Obligations (but not on a junior basis to any such Indebtedness that is itself secured on a junior basis to the Secured Obligations)), in each case prepaid pursuant to Section 2.10(a), Section 2.16(b)(B) or Section 10.02(f)(i) or pursuant to the corresponding provisions of the documentation governing any such Permitted Incremental Equivalent Debt, Senior Secured Indebtedness, Junior Secured Indebtedness, Credit Agreement Refinancing Indebtedness in respect thereof or Permitted Debt Exchange Notes (in the case of any prepayment of Revolving Loans and/or Incremental Revolving Loans, to the extent accompanied by a corresponding permanent reduction in the Revolving Commitment), during the applicable Excess Cash Flow Period (or, at the option of the Borrower and without duplication, after such Excess Cash Flow Period and prior to such subsequent ECF Payment Date) and (y) the amount actually paid in cash pursuant to any assignment made in accordance with Section 10.04(b)(viii) of this Agreement (to the extent such assignment was offered to all Lenders of the applicable Class) or the corresponding provisions of the documentation governing any Permitted Incremental Equivalent Debt, Incremental Facility, Senior Secured Indebtedness or Junior Secured Indebtedness, in each case secured on a pari passu basis with the Obligations or on a junior basis to the Secured Obligations (but not on a junior basis to any such Indebtedness that is itself secured on a junior basis to the Secured Obligations) (or, in each case, any Credit Agreement Refinancing Indebtedness or Permitted Refinancing or Permitted Debt Exchange Notes offered in exchange therefor, in each case, to the extent secured on a pari passu basis with Obligations or on a junior basis to the Secured Obligations (but not on a junior basis to any such Indebtedness that is itself secured on a junior basis to the Secured Obligations)) (in each case to the extent such assignment was offered to all lenders or holders of the applicable class thereof) during the applicable Excess Cash Flow Period (or, at the option of the Borrower, and without duplication, after such Excess Cash Flow Period and prior to such subsequent ECF Payment Date) (and the First Lien Leverage Ratio shall be recalculated for purposes of determining the Applicable ECF Percentage to give pro forma effect to all such voluntary prepayments), and in the case of all such prepayments or buybacks, to the extent that such prepayments or buybacks were financed with sources other than the proceeds of long-term Indebtedness (other than revolving Indebtedness to the extent intended to be repaid from operating cash flow) of Holdings or its Restricted Subsidiaries (such payment, the ECF Payment Amount).
(g) Notwithstanding the foregoing, mandatory prepayments made pursuant to clauses (c), (e) and (f) above by or with respect to Foreign Subsidiaries shall be limited to the extent that the Borrower reasonably determines that such prepayment or the obligation to make such prepayment could reasonably be expected to result in adverse tax consequences to Holdings or its Restricted Subsidiaries or to any direct or indirect parent of Holdings on account of its direct or indirect ownership of Holdings and its Restricted Subsidiaries that are not de minimis (including the imposition of any withholding tax) related to the repatriation of funds or could reasonably be expected to be prohibited, restricted or delayed by applicable law. All prepayments referred to in clauses (c), (e) and (f) above are subject to permissibility under (in the case of any such payments made by or with respect to Foreign Subsidiaries) local law (including without limitation, financial assistance, corporate benefit, thin capitalization, capital maintenance, foreign exchange controls and similar legal principles, restrictions on upstreaming of cash intra-group, and the fiduciary and statutory duties of the directors of the relevant
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Restricted Subsidiaries), under any applicable Organizational Documents (including as a result of minority ownership, but other than with respect to any immaterial restrictions therein), and under any other material agreements to which Holdings or any of its Subsidiaries is party (so long as any such reasonably expected prohibition is not created in contemplation of such mandatory prepayment requirement). Further, with respect to mandatory prepayments made pursuant to clauses (c), (e) and (f) above by or with respect to Foreign Subsidiaries there will be no requirement to make any prepayment where by doing so Holdings and its Restricted Subsidiaries or to any direct or indirect parent of Holdings on account of its direct or indirect ownership of Holdings and its Restricted Subsidiaries could reasonably be expected to suffer adverse tax consequences that are not de minimis (including the imposition of any withholding tax) as a result of upstreaming cash to make such prepayments (including the imposition of withholding taxes). The non-application of any such prepayment amounts as a result of the foregoing provisions will not constitute a Default or an Event of Default, and such amounts shall be available for working capital purposes of Holdings and the applicable Restricted Subsidiaries as long as not required to be prepaid in accordance with the following provisions. The Borrower will undertake to use commercially reasonable efforts for a period of no greater than one year to overcome or eliminate any such restriction and/or minimize any such costs of prepayment and/or use the other cash resources of the Borrower and its Restricted Subsidiaries (subject to the considerations above and as determined in the Borrowers reasonable business judgment) to make the relevant payment. If at any time within one year of a mandatory prepayment pursuant to clauses (c), (e) or (f) being forgiven due to such restrictions, such restrictions are removed, any relevant proceeds will at the end of the then current interest period be applied in prepayment in accordance with Section 2.10(h). Notwithstanding the foregoing, any prepayments made after application of the above provision shall be net of any costs, expenses or taxes incurred by Holdings and its Restricted Subsidiaries or any of its Affiliates (or direct or indirect equityholders) and arising as a result of compliance with the preceding sentence, and Holdings and its Restricted Subsidiaries shall be permitted to make, directly or indirectly, a dividend or distribution to its Affiliates or direct or indirect equityholders in an amount sufficient to cover such tax liability, costs or expenses.
(h) Application of Prepayments. Prior to any optional or mandatory prepayment hereunder, the Borrower shall select the Borrowing or Borrowings to be prepaid and shall specify such selection in the notice of such prepayment pursuant to Section 2.10(i), subject to the provisions of this Section 2.10(h). Any prepayments pursuant to Section 2.10(c), (d), (e) and (f) shall be applied pro rata amongst each Tranche of outstanding Term Loans and, within each Tranche, first, to accrued interest and fees with respect to Term Loans being prepaid and second, to reduce remaining scheduled payments required under Section 2.09 (or any equivalent provision applicable to any Tranche of Term Loans extended hereunder after the Closing Date) as directed by the Borrower (or, in the case of no direction, in direct order of maturity). Any prepayment of Term Loans pursuant to Section 2.10(a) shall be applied as directed by the Borrower (or, in the case of no direction, in direct order of maturity). After application of mandatory prepayments of Term Loans described above in this Section 2.10(h) and to the extent there are mandatory prepayment amounts remaining after such application, such amounts shall be applied as directed by the Borrower.
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Amounts to be applied pursuant to Section 2.10(h) to the prepayment of Loans shall be applied, first to reduce outstanding ABR Loans, if any. Any amounts remaining after each such application shall be applied to prepay Eurodollar Loans, if any. Notwithstanding the foregoing, if the amount of any prepayment of Loans required under this Section 2.10 shall be in excess of the amount of the ABR Loans at the time outstanding (an Excess Amount), only the portion of the amount of such prepayment as is equal to the amount of such outstanding ABR Loans shall be immediately prepaid and, at the election of the Borrower, the Excess Amount shall be either (A) deposited in an escrow account and applied to the prepayment of Eurodollar Loans on the last day of the then next-expiring Interest Period for Eurodollar Loans; provided that (i) interest in respect of such Excess Amount shall continue to accrue thereon at the rate provided hereunder for the Loans which such Excess Amount is intended to repay until such Excess Amount shall have been used in full to repay such Loans and (ii) at any time while an Event of Default has occurred and is continuing, the Administrative Agent may, and upon written direction from the Required Lenders shall, apply any or all proceeds then on deposit to the payment of such Loans in an amount equal to such Excess Amount or (B) prepaid immediately, together with any amounts owing to the Lenders under Section 2.13.
Notwithstanding anything herein to the contrary, with respect to any prepayment under Section 2.10(c), (e) or (f), the Borrower may use a portion of the Net Cash Proceeds to prepay or repurchase Permitted Incremental Equivalent Debt, Permitted Pari Passu Refinancing Debt and any other senior Indebtedness in each case secured by the Collateral on a pari passu basis with the Liens securing the Obligations (the Applicable Other Indebtedness) to the extent required pursuant to the terms of the documentation governing such Applicable Other Indebtedness, in which case, the amount of the prepayment required to be offered with respect to such Net Cash Proceeds pursuant to Section 2.10(c), (e) or (f) shall be deemed to be the amount equal to the product of (x) the amount of such Net Cash Proceeds multiplied by (y) a fraction, the numerator of which is the outstanding principal amount of Term Loans required to be prepaid pursuant to Section 2.10(c), (e) or (f) and the denominator of which is the sum of the outstanding principal amount of such Applicable Other Indebtedness and the outstanding principal amount of Term Loans required to be prepaid pursuant to Section 2.10(c), (e) or (f).
(i) Notice of Prepayment. The Borrower shall notify the Administrative Agent (and, in the case of prepayment of a Swing Line Loan, the Swing Line Lender) by written notice in substantially the form attached as Exhibit C-2 of any prepayment hereunder (i) in the case of prepayment of a Eurodollar Borrowing, not later than 1:00 p.m., New York City time, three Business Days before the date of prepayment (or such later time as may be agreed by the Administrative Agent in its sole discretion), (ii) in the case of prepayment of an ABR Borrowing, not later than 1:00 p.m., New York City time, on the date of prepayment (or such later time as may be agreed by the Administrative Agent in its sole discretion), and (iii) in the case of prepayment of Swing Line Loans, not later than 1:00 p.m., New York City time, on the date of prepayment (or such later time as may be agreed upon by the Administrative Agent in its sole discretion). Each such notice shall be irrevocable; provided that a notice of an optional prepayment pursuant to Section 2.10(a) delivered by the Borrower may state that such notice is conditioned upon the effectiveness of any such other credit facilities or the closing of any such securities offering, or the occurrence of any other event specified therein, in which case such notice may be revoked by the Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied. With respect to the effectiveness of any such other credit facilities or the closing of any such securities offering, the Borrower may extend the date of the optional prepayment pursuant to Section 2.10(a) at any time with the
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consent of the Administrative Agent (which consent shall not be unreasonably withheld or delayed). Each such notice shall specify the Borrowing to be repaid, the prepayment date, the principal amount of each Borrowing or portion thereof to be prepaid and, in the case of a mandatory prepayment, a reasonably detailed calculation of the amount of such prepayment. Promptly following receipt of any such notice (other than a notice relating solely to Swing Line Loans), the Administrative Agent shall advise the Lenders of the contents thereof. Each partial prepayment of any Borrowing shall be in an amount that would be permitted in the case of a Credit Extension of the same Type as provided in Section 2.02, except as necessary to apply fully the required amount of a mandatory prepayment. Each prepayment of a Borrowing shall be applied ratably to the Loans included in the prepaid Borrowing and otherwise in accordance with this Section 2.10. Prepayments shall be accompanied by accrued interest to the extent required by Section 2.06. Notwithstanding the foregoing, each Lender may reject all or a portion of its pro rata share of any mandatory prepayment (such declined amounts, the Declined Proceeds) of Term Loans required to be made pursuant to clauses (c), (d) (other than mandatory prepayments with the proceeds of Credit Agreement Refinancing Indebtedness), (e) and (f) of this Section 2.10 by providing written notice (each, a Rejection Notice) to the Administrative Agent and the Borrower no later than 5:00 p.m. one Business Day prior to such prepayment. Each Rejection Notice from a given Lender shall specify the principal amount of the mandatory prepayment of Term Loans to be rejected by such Lender. If a Lender fails to deliver a Rejection Notice to the Administrative Agent within the time frame specified above or such Rejection Notice fails to specify the principal amount of the Term Loans to be rejected, any such failure will be deemed an acceptance of the total amount of such mandatory repayment of Term Loans. Any Declined Proceeds shall be applied as directed by the Borrower (any such proceeds that are not applied by the Borrower to prepay other Indebtedness shall be referred to herein as Retained Declined Proceeds).
(j) Loan Call Protection. At the time of the effectiveness of any Repricing Event that is consummated on or prior to the date that is six months after the Closing Date, the primary purpose of which is to lower the Effective Yield on the initial Term Loans, the Borrower agrees to pay on the date of effectiveness of such Repricing Event to the Administrative Agent, for the ratable account of each applicable Term Loan Lender, 1.00% of the portion of the principal amount of the initial Term Loans held by such Term Loan Lender at the time of such Repricing Event that is affected by such Repricing Event in the manner set forth in the definition of Repricing Event.
Section 2.11 Alternate Rate of Interest. If prior to the commencement of any Interest Period for a Eurodollar Borrowing:
(a) the Administrative Agent determines in good faith and in its reasonable discretion (which determination shall be deemed presumptively correct absent manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate for such Interest Period;
(b) the Administrative Agent determines in good faith and in its reasonable discretion or is advised in writing by the Required Lenders (which determination shall be deemed presumptively correct absent manifest error) that Dollar deposits are not being offered to banks in the London interbank eurodollar market for the applicable amount and Interest Period of such Eurodollar Loan; or
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(c) the Administrative Agent determines in good faith and in its reasonable discretion or is advised in writing by the Required Lenders that the Adjusted LIBO Rate for such Interest Period will not adequately and fairly reflect the cost to such Lenders of making or maintaining their Loans included in such Borrowing for such Interest Period; then the Administrative Agent shall give written notice thereof to the Borrower and the Lenders as promptly as practicable thereafter and, until the Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist (which notice shall be delivered by the Administrative Agent promptly after such situation ceases to exist), (i) any Interest Election Request that requests the conversion of any Borrowing to, or continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective and the obligation of the Lenders to make or maintain Eurodollar Loans shall be suspended (to the extent of the affected Eurodollar Loans or Interest Periods), and (ii) if any Borrowing Request requests a Eurodollar Borrowing, such Borrowing shall be made as an ABR Borrowing; provided that the Borrower may revoke any such Borrowing Request (without penalty) prior to such Borrowing upon written notice to the Administrative Agent.
Section 2.12 Yield Protection.
(a) Increased Costs Generally. If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in, by any Lender (except any reserve requirement reflected in the Adjusted LIBO Rate) or the Issuing Bank;
(ii) subject the Administrative Agent, any Lender or the Issuing Bank to any Tax of any kind whatsoever (except for Indemnified Taxes indemnified under Section 2.15 and any Excluded Tax) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto, or change the basis of taxation of payments to such Administrative Agent or Lender or the Issuing Bank in respect thereof; or
(iii) impose on any Lender or the Issuing Bank or the London interbank market any other condition, cost or expense affecting this Agreement or Eurodollar Loans made by such Lender or any Letter of Credit or participation therein; and the result of any of the foregoing shall be to increase the cost to such Lender of making, converting or maintaining any Eurodollar Loan or any other Loan (or of maintaining its obligation to make any such Loan), or to increase the cost to such Lender, the Issuing Bank or such Lenders or the Issuing Banks holding company, if any, of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by the Administrative Agent, such Lender or the Issuing Bank hereunder (whether of principal, interest or any other amount), then, upon written request of the Administrative Agent, such Lender or the Issuing Bank, as applicable, the Borrower will pay to the Administrative Agent, such Lender or the Issuing Bank, as the case may be, such additional amount or amounts as will compensate the Administrative Agent, such Lender or the Issuing Bank, as the case may be, for such additional costs incurred or reduction suffered.
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(b) Capital Requirements. If any Lender or the Issuing Bank determines (in good faith, in its reasonable discretion) that any Change in Law affecting such Lender or the Issuing Bank or any lending office of such Lender or such Lenders or the Issuing Banks holding company, if any, regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lenders or the Issuing Banks capital or on the capital of such Lenders or the Issuing Banks holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made by, or participations in Letters of Credit or Swing Line Loans held by, such Lender, or the Letters of Credit issued by the Issuing Bank, to a level below that which such Lender or the Issuing Bank or such Lenders or the Issuing Banks holding company, if any, would have achieved but for such Change in Law (taking into consideration such Lenders or the Issuing Banks policies and the policies of such Lenders or the Issuing Banks holding company, if any, with respect to capital adequacy or liquidity requirements), then from time to time the Borrower will pay to such Lender or the Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or the Issuing Bank or such Lenders or the Issuing Banks holding company, if any, for any such reduction suffered.
(c) Certificates for Reimbursement. A certificate of the Administrative Agent, a Lender or the Issuing Bank setting forth the amount or amounts necessary to compensate the Administrative Agent, such Lender or the Issuing Bank or its holding company, as the case may be, as specified in clause (a) or (b) of this Section 2.12, and setting forth in reasonable detail the calculation of the amount owed and the basis for the claim shall be delivered to the Borrower and shall be deemed presumptively correct absent manifest error. The Borrower shall pay the Administrative Agent, such Lender or the Issuing Bank, as the case may be, the amount shown as due on any such certificate within ten Business Days after receipt thereof.
(d) Delay in Requests. Failure or delay on the part of any Lender or the Issuing Bank to demand compensation pursuant to this Section 2.12 shall not constitute a waiver of such Lenders or the Issuing Banks right to demand such compensation; provided that the Borrower shall not be required to compensate a Lender or the Issuing Bank pursuant to this Section 2.12 for any increased costs incurred or reductions suffered more than 180 days prior to the date that such Lender or the Issuing Bank, as the case may be, notifies the Borrower of the Change in Law giving rise to such increased costs or reductions pursuant to the certificate to be delivered in clause (c) above and of such Lenders or the Issuing Banks intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 180 day period referred to above shall be extended to include the period of retroactive effect thereof).
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Section 2.13 Funding Losses. Upon demand of any Lender (with a copy to the Administrative Agent) from time to time, the Borrower shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense incurred by it as a result of
(a) any continuation, conversion, payment or prepayment of any Eurodollar Loan on a day other than the last day of the Interest Period for such Loan; or
(b) any failure by the Borrower (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow, continue or convert any Loan (other than an ABR Loan) on the date or in the amount notified by the Borrower including any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan or from fees payable to terminate the deposits from which such funds were obtained.
For purposes of calculating amounts payable by the Borrower to the Lenders under this Section 2.13, each Lender shall be deemed to have funded each Eurodollar Loan made by it at the LIBO Rate for such Loan by a matching deposit or other borrowing in the London interbank eurodollar market for a comparable amount and for a comparable period, whether or not such Eurodollar Loan was in fact so funded.
Section 2.14 Payments Generally; Pro Rata Treatment; Sharing of Setoffs.
(a) Payments Generally. The Borrower shall make each payment required to be made by it hereunder or under any other Loan Document (whether of principal, interest, fees or Reimbursement Obligations, or of amounts payable under Sections 2,12, 2,13, 2,15 or 10,03, or otherwise) on or before the time expressly required hereunder or under such other Loan Document for such payment (or, if no such time is expressly required, prior to 2:00 p.m., New York City time), on the date when due, in immediately available funds, free and clear of, and without condition or deduction for, recoupment or setoff. Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All such payments shall be made to the Administrative Agent at its Principal Office except payments to be made directly to the Issuing Bank or Swing Line Lender as expressly provided herein and except that payments pursuant to Sections 2,12, 2,13, 2,15 and 10.03 shall be made directly to the persons entitled thereto and payments pursuant to other Loan Documents shall be made to the persons specified therein. The Administrative Agent shall distribute any such payments received by it for the account of any other person to the appropriate recipient promptly following receipt thereof. If any payment under any Loan Document shall be due on a day that is not a Business Day, unless specified otherwise, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension. All payments under each Loan Document shall be made in Dollars. For the avoidance of doubt, notwithstanding any other provision of any Loan Document to the contrary, no payment received directly or indirectly from any Credit Party that is not a Qualified ECP Guarantor shall be applied directly or indirectly by the Administrative Agent or otherwise to the payment of any Excluded Swap Obligations.
(b) Pro Rata Treatment.
(i) Other than as permitted by Section 2.20, Section 2.21, Section 2.22, Section 2.23, Section 2.16(b), Section 10.02(f) and Section 10.04, and subject to the express provisions of this Agreement which require, or permit, differing payments to be made to non-Defaulting Lenders as opposed to Defaulting Lenders, each payment by the Borrower of interest in respect of the Loans shall be applied to the amounts of such obligations owing to the Lenders pro rata according to the respective amounts then due and owing to the Lenders.
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(ii) Other than as permitted by Section 2.20, Section 2.21, Section 2.22, Section 2.23, Section 2.16(b), Section 10.02(f) and Section 10.04, and subject to the express provisions of this Agreement which require, or permit, differing payments to be made to non-Defaulting Lenders as opposed to Defaulting Lenders, (A) each payment by the Borrower on account of principal of the Term Loans shall be allocated among the Term Loan Lenders pro rata based on the principal amount of the Term Loans held by the Term Loan Lenders; (B) each payment by the Borrower on account of principal of the Revolving Borrowings shall be made pro rata according to the respective outstanding principal amounts of the Revolving Loans then held by the Revolving Lenders; and (C) each permanent reduction in Revolving Commitments shall be pro rata according to the respective Revolving Commitments then held by the Revolving Lenders.
(c) Insufficient Funds. If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, Reimbursement Obligations, interest and fees then due hereunder, such funds shall be applied (i) first, toward payment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, and (ii) second, toward payment of principal and Reimbursement Obligations then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal and Reimbursement Obligations then due to such parties. It is understood that the foregoing does not apply to any adequate protection payments under any federal, state or foreign bankruptcy, insolvency, receivership or similar proceeding, and that the Administrative Agent may, subject to any applicable federal, state or foreign bankruptcy, insolvency, receivership or similar orders, distribute any adequate protection payments it receives on behalf of the Lenders to the Lenders in its sole discretion (i.e., whether to pay the earliest accrued interest, all accrued interest on a pro rata basis or otherwise).
(d) Sharing of Setoff. Subject to the terms of any Intercreditor Agreement, if any Lender (and/or the Issuing Bank, which shall be deemed a Lender for purposes of this Section 2.14(d)) shall, by exercising any right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of its Loans or other Obligations resulting in such Lenders receiving payment of a proportion of the aggregate amount of its Loans and accrued interest thereon or other Obligations greater than its pro rata share thereof as provided herein, then the Lender receiving such greater proportion shall (a) notify the Administrative Agent of such fact, and (b) purchase (for cash at face value) participations in the Loans and such other obligations of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Loans and other amounts owing them; provided that:
(i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest; and
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(ii) the provisions of this paragraph shall not be construed to apply to any payment (x) made by the Borrower pursuant to and in accordance with the express terms of this Agreement or (y) obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in LC Disbursements to any assignee or participant).
Each Credit Party consents to the foregoing and agrees, to the extent it may effectively do so under applicable Requirements of Law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against such Credit Party rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of such Credit Party in the amount of such participation. If under applicable bankruptcy, insolvency or any similar law any Secured Party receives a secured claim in lieu of a setoff or counterclaim to which this Section 2.14(d) applies, such Secured Party shall, to the extent practicable, exercise its rights in respect of such secured claim in a manner consistent with the rights to which the Secured Party is entitled under this Section 2.14(d) to share in the benefits of the recovery of such secured claim.
(e) Borrower Default. Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders or the Issuing Bank hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the Issuing Bank, as the case may be, the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders or the Issuing Bank, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or the Issuing Bank with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.
(f) Obligations of Lenders Several. The obligations of the Lenders hereunder to make Loans, to fund participations in Letters of Credit and Swing Line Loans and to make payments pursuant to Section 10.03(c) are several and not joint. The failure of any Lender to make any Loan, to fund any such participation or to make any payment under Section 10.03(c) on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to so make its Loans, to purchase its participation or to make its payment under Section 10.03(c).
Section 2.15 Taxes.
(a) Payments Free of Taxes. Any and all payments by or on account of any obligation of the Credit Parties hereunder or under any other Loan Document shall be made free and clear of and without reduction, deduction or withholding for any Taxes (Tax Withholdings) except as required by any applicable Requirements of Law; provided that if any Taxes are required by any applicable Requirements of Law to be withheld or deducted in respect of any such payments by any applicable withholding agent (as determined in the good faith discretion of an applicable withholding agent), then (i) in the case of Indemnified Taxes, the sum
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payable by the relevant Credit Party shall be increased as necessary so that after all such Tax Withholdings have been made (including deductions or withholdings applicable to additional sums payable under this Section 2.15), each Recipient receives an amount equal to the sum it would have received had no such Tax Withholdings been made (including such Tax Withholdings applicable to additional sums payable under this Section 2.15) (such additional sums being the Additional Amount), (ii) the applicable withholding agent shall make such Tax Withholdings, and (iii) the applicable withholding agent shall timely pay the full amount of the Tax Withholdings to the relevant Governmental Authority.
(b) Payment of Other Taxes by the Borrower. Without limiting the provisions of clause (a) above, the Credit Parties shall timely pay any Other Taxes to the relevant Governmental Authority in accordance with applicable Requirements of Law, or at the option of the Administrative Agent timely reimburse it for the payment of any Other Taxes.
(c) Indemnification by the Borrower. The Credit Parties shall indemnify and hold harmless (on a joint and several basis) each Recipient, within ten days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 2.15) payable or paid by such Recipient or required to be withheld and deducted from a payment to such Recipient, and any penalties, interest and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Borrower by a Recipient (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Recipient, shall be conclusive absent manifest error.
(d) Evidence of Payments. As soon as practicable after any payment of Taxes by any Credit Party pursuant to this Section 2.15 to a Governmental Authority, the Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the Tax Return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.
(e) Status of Lenders.
(i) Each Recipient shall deliver to the Borrower and to the Administrative Agent, whenever reasonably requested by the Borrower or the Administrative Agent, such properly completed and duly executed documentation prescribed by applicable Requirements of Law and such other reasonably requested information as will permit the Borrower or the Administrative Agent, as the case may be, (x) to determine whether or not any payments made under any Loan Document are subject to Tax Withholdings or information reporting requirements, (y) to determine, if applicable, the required rate of Tax Withholdings, and (z) to establish such Recipients entitlement to any available exemption from, or reduction in the rate of, Tax Withholdings, in respect of any payments to be made to such Recipient by any Credit Party pursuant to any Loan Document or otherwise establish such Recipients status for withholding Tax purposes in an applicable jurisdiction. Notwithstanding anything to the contrary in the preceding sentence, the completion, execution and submission of such documentation and information (other than such documentation set forth in Section 2.15(e)(ii)(A)(l)-(4), Section 2.15(e)(ii)(B) and Section 2.15(e)(ii)(C) below) shall not be required if in the Recipients reasonable judgment such completion, execution or submission would subject such Recipient to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Recipient.
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(ii) Without limiting the generality of the foregoing:
(A) each Foreign Lender shall deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Recipient under this Agreement (and from time to time thereafter upon the request of the Borrower or the Administrative Agent) whichever of the following is applicable:
(1) properly completed and duly executed copies of IRS Form W-8BEN or W-8BEN-E (or any successor form) claiming eligibility for benefits of an income tax treaty to which the United States is a party,
(2) properly completed and duly executed copies of IRS Form W-8ECI (or any successor form),
(3) in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate substantially in the form of Exhibit K-l and (y) properly completed and duly executed copies of IRS Service Form W-8BEN or W-8BEN-E (or any successor form),
(4) to the extent a Foreign Lender is not the beneficial owner (for example, where the Foreign Lender is a partnership or a participating Lender granting a participation), properly completed and duly executed copies of IRS Form W-8IMY, accompanied by a Form W-8ECI, W-8BEN, W-8BEN-E, a certificate substantially in the form of Exhibit K-2 or Exhibit K-3, Form W-9, and/or other certification documents from each beneficial owner, as applicable (provided that if the Foreign Lender is a partnership for U.S. federal income tax purposes and one or more direct or indirect partners are claiming the portfolio interest exemption, the certificate substantially in the form of Exhibit K-4 may be provided by such Foreign Lender on behalf of such direct or indirect partners), or
(5) any other form prescribed by applicable Requirements of Law as a basis for claiming exemption from or a reduction in U.S. federal withholding tax duly completed together with such supplementary documentation as may be prescribed by applicable Requirements of Law to permit the Borrower and the Administrative Agent to determine any withholding or deduction required to be made;
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(B) each Recipient that is not a Foreign Lender shall deliver to the Borrower and the Administrative Agent two properly completed and duly executed copies of IRS Form W-9 (or any successor or other applicable form) certifying that such Recipient is exempt from United States federal backup withholding;
(C) if a payment made to a Recipient under any Loan Document would be subject to United States federal withholding tax imposed by FATCA if such Recipient were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Recipient shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by applicable Requirements of Law and at such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable Requirements of Law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under FATCA, to determine whether such Recipient has complied with such Recipients obligations under FATCA or to determine the amount (if any) to deduct and withhold from such payment. Solely for purposes of this clause (C), FATCA shall include any amendments made to FATCA after the date of this Agreement;
(D) notwithstanding any other provision of this Section 2.15(e), a Recipient shall not be required to deliver any documentation or information that such Recipient is not legally eligible to deliver; and
(E) each such Recipient shall, from time to time after the initial delivery by such Recipient of any form or certificate, whenever a lapse in time or change in such Recipients circumstances renders such form or certificate (including any specific form or certificate required in this Section 2.15(e)) so delivered obsolete, expired or inaccurate in any material respect, promptly (i) update such form or certificate or (ii) notify the Borrower and the Administrative Agent in writing of its legal ineligibility to do so.
(f) Treatment of Certain Refunds. If the Administrative Agent or a Lender determines, in its sole discretion exercised in good faith, that it has received a refund of any Indemnified Taxes as to which it has been indemnified by the Credit Parties or on account of which the Credit Parties have paid Additional Amounts pursuant to this Section 2.15, it shall pay to the Credit Parties an amount equal to such refund (but only to the extent of indemnity payments made, or Additional Amounts paid, by the Credit Parties under this Section with respect to the Indemnified Taxes giving rise to such refund), net of any Taxes thereon and of all out-of-pocket expenses of the Administrative Agent or such Lender, as the case may be, and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided that the Credit Parties, upon the request of the Administrative Agent or such Lender, agrees to repay any such amount paid over to the Credit Parties to the Administrative Agent or such Lender (plus any penalties, interest or other charges imposed by
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the relevant Governmental Authority) in the event the Administrative Agent or such Lender is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this clause (f), in no event will the Administrative Agent or a Lender be required to pay any amount to the Credit Parties pursuant to this clause (f), the payment of which would place the Administrative Agent or a Lender, as applicable, in a less favorable net after-Tax position than it would have been in if the Tax subject to indemnification (or the payment of Additional Amounts) and giving rise to such refund had not been deducted, withheld or imposed and the indemnification payments (or Additional Amounts) with respect to such Tax had never been paid. Nothing herein contained shall interfere with the right of a Recipient to arrange its tax affairs in whatever manner it thinks fit nor obligate any Recipient to claim any tax refund or to make available its Tax Returns or disclose any information relating to its tax affairs or any computations in respect thereof or require any Recipient to do anything that would prejudice its ability to benefit from any other refunds, credits, reliefs, remissions or repayments to which it may be entitled. Unless required by Requirements of Law, at no time shall the Administrative Agent have any obligation to file for or otherwise pursue on behalf of a Lender, or have any obligation to pay to any Lender, any refund of Taxes withheld or deducted from funds paid for the account of such Lender, as the case may be.
(g) Survival. The obligations of the Credit Parties under this Section 2.15 shall survive the resignation or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any Loan Document. For purposes of this Section 2.15, any payments by the Administrative Agent to a Lender of any amounts received by the Administrative Agent from any Credit Party on behalf of such Lender shall be treated as a payment from such Credit Party to such Lender.
(h) For the avoidance of doubt, for the purposes of this Section 2.15, the term Lender shall include the Swing Line Lender and the Issuing Bank.
Section 2.16 Mitigation Obligations; Replacement of Lenders.
(a) Designation of a Different Lending Office. If any Lender requests compensation under Section 2.12 or requires the Borrower to pay any Additional Amount to any Lender or any Governmental Authority (other than with respect to Other Taxes) for the account of any Lender pursuant to Section 2.15, or if any event gives rise to the operation of Section 2.26, then, in each such case, such Lender shall (at the request of the Borrower) use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates or to file any certificate or document reasonably required by the Borrower, if, in the reasonable judgment of such Lender, such designation or assignment or filing (i) would eliminate or reduce amounts payable pursuant to Section 2.12 or 2,15, or avoid the consequences of the event giving rise to the operation of Section 2.26, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment. A certificate setting forth in reasonable detail the calculation of such costs and expenses submitted by such Lender to the Borrower shall be deemed presumptively correct absent manifest error.
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(b) Replacement of Lenders. If (v) any Lender or the Administrative Agent requests compensation under Section 2.12, (w) any Lender or the Administrative Agent is affected in the manner described in Section 2.26 and as a result thereof any of the actions described in such Section is required to be taken, (x) the Borrower is required to pay any Additional Amount to any Lender or the Administrative Agent or any Governmental Authority (other than with respect to Other Taxes) for the account of any Lender or the Administrative Agent pursuant to Section 2.15, and such Lender or the Administrative Agent declined or is unable to designate a different lending office in accordance with Section 2.16(a), (y) any Lender or the Administrative Agent is a Defaulting Lender or (z) the Borrower exercises its replacement rights under Section 10.02(f), then the Borrower may, at its sole expense and effort and option, upon notice to such Lender and the Administrative Agent, (A) require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 10.04), all of its interests, rights (other than its existing rights to payments pursuant to Section 2.12 or 2,15 arising with respect to any period prior to such assignment) and obligations under this Agreement and the other Loan Documents to an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment), (B) pay off in full all of the Loans and any other Obligations owed to such Lender, (C) if applicable, terminate such Lenders Commitments or (D) if applicable, upon at least ten (10) days prior notice, require the Administrative Agent to resign in accordance with Section 9,06; provided that:
(i) unless waived by the Administrative Agent, the Borrower shall have paid to the Administrative Agent the processing and recordation fee specified in Section 10.04(b), if any,
(ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in LC Disbursements, accrued interest thereon, accrued fees and all other amounts (including any amount pursuant to Section 2.10(i) if a Repricing Event has occurred) payable to it hereunder and under the other Loan Documents (including any amounts under Sections 2,12 and 2,15, assuming for this purpose (in the case of a Lender being replaced as the result of a claim or payment under Sections 2,12 or 2,15) that the Loans of such Lender were being prepaid) from the assignee or the Borrower;
(iii) in the case of any such assignment resulting from a claim for compensation under Section 2.12 or payments required to be made pursuant to Section 2.15, such assignment will result in a reduction in such compensation or payments thereafter; and
(iv) such assignment does not conflict with applicable Requirements of Law.
Each Lender agrees that, if the Borrower elects to replace such Lender in accordance with this Section 2.16(b), it shall promptly execute and deliver to the Administrative Agent an Assignment and Assumption to evidence the assignment and shall deliver to the Administrative Agent any Note (if Notes have been issued in respect of such Lenders Loans) subject to such Assignment and Assumption; provided that the failure of any such Lender to execute an Assignment and Assumption shall not render such assignment invalid and such assignment shall be in full force and effect and shall be recorded in the Register.
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Section 2.17 Swing Line Loans.
(a) Swing Line Commitment. Subject to the terms and conditions set forth herein, the Swing Line Lender, in reliance upon the agreements of the other Revolving Lenders set forth in this Section 2.17, agrees to make Swing Line Loans to the Borrower from time to time on any Business Day during the Revolving Availability Period, in an aggregate principal amount at any time outstanding that will not result in (and upon each such Borrowing of Swing Line Loans, the Borrower shall be deemed to represent and warrant that such Borrowing will not result in) (i) the aggregate principal amount of outstanding Swing Line Loans exceeding the Swing Line Commitment, or (ii) the sum of the total Revolving Exposures exceeding the total Revolving Commitments; provided that the Swing Line Lender shall not be required to make a Swing Line Loan to refinance, in whole or in part, an outstanding Swing Line Loan. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower may borrow, repay and reborrow Swing Line Loans. Immediately upon the making of a Swing Line Loan, each Revolving Lender shall be deemed to, and hereby does, irrevocably and unconditionally agree to purchase from the Swing Line Lender a risk participation in such Swing Line Loan in an amount equal to the product of such Revolving Lenders Pro Rata Percentage times the amount of such Swing Line Loan.
(b) Swing Line Loans. To request a Swing Line Loan, the Borrower shall deliver, by hand delivery or facsimile transmission (or transmit by other electronic transmission if arrangements for doing so have been approved in writing by the Administrative Agent), a duly completed and executed Borrowing Request to the Administrative Agent and the Swing Line Lender, not later than 12:00 p.m., New York City time (or such later time as the Administrative Agent may agree in its sole discretion), on the Business Day of a proposed Swing Line Loan. Each such notice shall be irrevocable and shall specify the requested date (which shall be a Business Day) and the amount of the requested Swing Line Loan. Each Swing Line Loan shall be an ABR Loan. The Swing Line Lender shall make each Swing Line Loan available to the Borrower by means of a credit to the general deposit account of the Borrower with the Swing Line Lender, if any, or otherwise to an account as directed by the Borrower in the applicable Borrowing Request (or, in the case of a Swing Line Loan made to finance the reimbursement of an LC Disbursement as provided in Section 2.18(e), by remittance to the Issuing Bank). The Swing Line Lender shall fund each Swing Line Loan by 3:00 p.m., New York City time on the requested date of such Swing Line Loan. The Borrower shall not request a Swing Line Loan if at the time of or immediately after giving effect to the Credit Extension contemplated by such request a Default or Event of Default has occurred and is continuing or would immediately thereafter result therefrom. Swing Line Loans shall be made in minimum amounts of $50,000 and integral multiples of $50,000 above such amount.
(c) Prepayment. The Borrower shall have the right at any time and from time to time to repay, without prepayment or penalty, any Swing Line Loan, in whole or in part, upon giving written notice (or notice by electronic transmission if arrangements for doing so have been approved in writing (including via email) by the Administrative Agent) from the Borrower to the Swing Line Lender and the Administrative Agent before 1:00 p.m., New York City time, on the proposed date of repayment.
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(d) Participations. The Swing Line Lender may at any time in its sole discretion, by written notice given to the Administrative Agent not later than 11:00 a.m., New York City time, on the next succeeding Business Day following such notice, require the Revolving Lenders to acquire participations on such Business Day in all or a portion of the Swing Line Loans then outstanding. Such notice shall specify the aggregate amount of Swing Line Loans in which Revolving Lenders will participate. Promptly upon receipt of such notice, the Administrative Agent will give notice thereof to each Revolving Lender, specifying in such notice such Lenders Pro Rata Percentage of such Swing Line Loan or Loans. Each Revolving Lender hereby absolutely and unconditionally agrees, upon receipt of notice as provided above, to pay to the Administrative Agent, for the account of the Swing Line Lender, such Lenders Pro Rata Percentage of such Swing Line Loan or Loans. Each Revolving Lender acknowledges and agrees that its obligation to acquire participations in Swing Line Loans pursuant to this paragraph is absolute and unconditional and shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a Default or Event of Default or a reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever. Each Revolving Lender shall comply with its obligation under this paragraph by wire transfer of immediately available funds, in the same manner as provided in Section 2.02(c) with respect to Loans made by such Lender (and Section 2.02 shall apply, mutatis mutandis, to the payment obligations of the Revolving Lenders), and the Administrative Agent shall promptly pay to the Swing Line Lender the amounts so received by it from the Revolving Lenders; provided that the Revolving Lender who is the Swing Line Lender shall be deemed to have funded its Pro Rata Percentage automatically without further funding. The Administrative Agent shall notify the Borrower of any participations in any Swing Line Loan acquired by the Revolving Lenders pursuant to this paragraph, and thereafter payments in respect of such Swing Line Loan shall be made to the Administrative Agent and not to the Swing Line Lender. Any amounts received by the Swing Line Lender from the Borrower (or other party on behalf of the Borrower) in respect of a Swing Line Loan after receipt by the Swing Line Lender of the proceeds of a sale of participations therein shall be promptly remitted to the Administrative Agent. Any such amounts received by the Administrative Agent shall be promptly remitted by the Administrative Agent to the Revolving Lenders that shall have made their payments pursuant to this paragraph, as their interests may appear. The purchase of participations in a Swing Line Loan pursuant to this paragraph shall not relieve the Borrower of any default in the payment thereof.
(e) Resignation or Removal of the Swing Line Lender. The Swing Line Lender may resign as Swing Line Lender hereunder at any time upon at least 30 days prior written notice to the Lenders, the Administrative Agent and the Borrower. Following such notice of resignation from the Swing Line Lender, the Swing Line Lender may be replaced at any time by written agreement among the Borrower (with the Borrowers agreement not to be unreasonably withheld, delayed or conditioned), the Administrative Agent and the successor Swing Line Lender. The Administrative Agent shall notify the Lenders of any such replacement of the Swing Line Lender. At the time any such resignation or replacement shall become effective, the Borrower shall pay all unpaid fees and interest accrued for the account of the replaced Swing Line Lender. From and after the effective date of any such resignation or
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replacement, (i) the successor Swing Line Lender shall have all rights and obligations of the Swing Line Lender under this Agreement with respect to Swing Line Loans to be made by it thereafter and (ii) references herein and in the other Loan Documents to the term Swing Line Lender shall be deemed to refer to such successor or to any previous Swing Line Lenders, or to such successor and all previous Swing Line Lenders, as the context shall require. After the resignation or replacement of the Swing Line Lender hereunder, the replaced Swing Line Lender shall remain a party hereto and shall continue to have all the rights and obligations of the Swing Line Lender under this Agreement with respect to Swing Line Loans made by it prior to such resignation or replacement, but shall not be required to make additional Swing Line Loans.
(f) Payments of Principal and Interest. Subject to Section 2.17(d), the Borrower shall make all payments of principal and interest in respect of the Swing Line Loans directly to the Administrative Agent on behalf of the Swing Line Lender.
(g) Provisions Related to Extended Tranches of Revolving Commitments. If the maturity date shall have occurred in respect of any tranche of Revolving Commitments at a time when another tranche or tranches of Revolving Commitments is or are in effect with a longer maturity date, then on the earliest occurring maturity date all then outstanding Swing Line Loans shall be repaid in full on such date (and there shall be no adjustment to the participations in such Swing Line Loans as a result of the occurrence of such maturity date); provided that if on the occurrence of such earliest maturity date (after giving effect to any repayments of Swing Line Loans and Revolving Loans and any reallocation of participations as contemplated in Section 2.18(p)), there shall exist sufficient unutilized non-terminating Revolving Commitments so that the respective outstanding Swing Line Loans could be incurred pursuant to the Revolving Commitments which will remain in effect after the occurrence of such maturity date, then there shall be an automatic adjustment on such date of the participations in such Swing Line Loans and the same shall be deemed to have been incurred solely pursuant to the relevant non-terminating Revolving Commitments, and such Swing Line Loans shall not be so required to be repaid in full on such earliest maturity date.
Section 2.18 Letters of Credit.
(a) General. Subject to the terms and conditions set forth herein, the Borrower may request the Issuing Bank, and the Issuing Bank agrees from time to time on any Business Day during the period from the Closing Date until the date that is 30 days prior to the Letter of Credit Expiration Date, to issue Letters of Credit denominated in Dollars for the account of the Borrower or any Wholly Owned Restricted Subsidiary of the Borrower in a form reasonably acceptable to the Borrower (with the Borrowers agreement not to be unreasonably withheld, delayed or conditioned), the Administrative Agent and the Issuing Bank, or to amend, renew or extend any Letter of Credit, at any time and from time to time prior to the Letter of Credit Expiration Date (provided that the Borrower shall be a co-applicant, and be jointly and severally liable, with respect to each Letter of Credit issued for the account of any Wholly Owned Restricted Subsidiary of Holdings) upon delivery to the relevant Issuing Bank and the Administrative Agent (at least three Business Days in advance of the requested date of issuance, amendment, renewal or extension) of an LC Request requesting the issuance of a Letter of Credit, or identifying the Letter of Credit to be amended, renewed or extended, and specifying the requested date of issuance of such Letter of Credit (which shall be a Business Day) and, as
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applicable, specifying the date of amendment, renewal or extension (which shall be a Business Day), the date on which such Letter of Credit is to expire, whether such Letter of Credit is to be a Standby Letter of Credit or a Commercial Letter of Credit, the amount of such Letter of Credit, the name and address of the beneficiary thereof and such other information as shall be necessary to prepare, amend, renew or extend such Letter of Credit, as applicable. The Issuing Bank shall have no obligation to issue, and the Borrower shall not request the issuance of, any Letter of Credit at any time if after giving effect to such issuance the LC Exposure would exceed the LC Sublimit or the total Revolving Exposure would exceed the total Revolving Commitments. If requested by the Issuing Bank, the Borrower also shall submit a letter of credit application on the Issuing Banks standard form in connection with any request for a Letter of Credit (the Application); provided that in the event of any inconsistency between the terms and conditions of this Agreement and the terms and conditions of any form of letter of credit application or other agreement submitted by the Borrower to, or entered into by the Borrower with, the Issuing Bank relating to any Letter of Credit, the terms and conditions of this Agreement shall control. Notwithstanding anything in this Section 2.18 or otherwise herein to the contrary, GS (i) shall not be obligated to issue any commercial or trade (as opposed to standby) Letter of Credit and (ii) shall not be required to have outstanding more than ten Letters of Credit.
(b) Request for Issuance, Amendment, Renewal, Extension; Certain Conditions and Notices. To request the issuance of a Letter of Credit or the amendment, renewal or extension of an outstanding Letter of Credit, the Borrower shall deliver by hand, or telecopier (or transmit by electronic communication, if arrangements for doing so have been approved by the Issuing Bank), an LC Request to the Issuing Bank and the Administrative Agent not later than 11:00 a.m. New York City time on the third Business Day preceding the requested date of issuance, amendment, renewal or extension (or such later date and time as is acceptable to the Issuing Bank).
A request for an initial issuance of a Letter of Credit shall specify, in form and detail reasonably satisfactory to the Issuing Bank:
(i) the proposed issuance date of the requested Letter of Credit (which shall be a Business Day) and whether such Letter of Credit is to be a Standby Letter of Credit or a Commercial Letter of Credit;
(ii) the stated or face amount thereof;
(iii) the expiry date thereof (which shall not be later than the close of business on the Letter of Credit Expiration Date or as otherwise extended pursuant to an LC Extension);
(iv) the name and address of the beneficiary thereof;
(v) whether the Letter of Credit is to be issued for the Borrowers own account, or the account of one of Holdings Wholly Owned Restricted Subsidiaries (provided that the Borrower shall be the applicant, and therefore jointly and severally liable, with respect to each Letter of Credit issued for the account of any of Holdings Wholly Owned Restricted Subsidiaries);
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(vi) the documents to be presented by such beneficiary in connection with any drawing thereunder;
(vii) the full text of any certificate to be presented by such beneficiary in connection with any drawing thereunder; and
(viii) such other matters as the Issuing Bank may reasonably require.
A request for an amendment, renewal or extension of any outstanding Letter of Credit shall specify in form and detail reasonably satisfactory to the Issuing Bank:
(i) the Letter of Credit to be amended, renewed or extended;
(ii) the proposed date of amendment, renewal or extension thereof (which shall be a Business Day);
(iii) the nature of the proposed amendment, renewal or extension; and
(iv) such other matters as the Issuing Bank reasonably may require.
A Letter of Credit shall be issued, amended, renewed or extended only if (and, upon issuance, amendment, renewal or extension of each Letter of Credit, the Borrower shall be deemed to represent and warrant that) after giving effect to such issuance, amendment, renewal or extension, (i) the LC Exposure shall not exceed the LC Sublimit, (ii) the total Revolving Exposures shall not exceed the total Revolving Commitments and (iii) the conditions set forth in Article IV in respect of such issuance, renewal or extension shall have been satisfied, provided, however that an Issuing Bank may permit renewal of an Auto-Renewal Letter of Credit in accordance with Section 2.18(c)(ii) below. Unless the Issuing Bank shall agree otherwise, no Letter of Credit shall be in an initial amount less than $100,000, in the case of a Commercial Letter of Credit, or $100,000 (or such lesser amount as approved by the Issuing Bank), in the case of a Standby Letter of Credit.
Upon the issuance of any Letter of Credit or amendment, renewal, extension or modification of a Letter of Credit, the Issuing Bank shall promptly notify the Administrative Agent (and in the case of an issuance of a new Letter of Credit, or an increase or decrease in the stated amount of an existing Letter of Credit, the Administrative Agent shall promptly notify each Revolving Lender), which notice shall be accompanied by a copy of such Letter of Credit or amendment, renewal, extension or modification to a Letter of Credit (and in the case of an issuance of a new Letter of Credit, or an increase or decrease in the stated amount of an existing Letter of Credit, the notice to each Revolving Lender shall include a copy of such Letter of Credit and the amount of each such Revolving Lenders respective participation in such Letter of Credit pursuant to Section 2.18(d)).
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(c) Expiration Date.
(i) Each Letter of Credit shall expire at or prior to the close of business on the earlier of (x) the date which is one year after the date of the issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, one year after such renewal or extension) and (y) the Letter of Credit Expiration Date; provided, however, the Issuing Bank, in its sole discretion, may agree to extend such Letter of Credit beyond the Letter of Credit Expiration Date (an LC Extension) upon the Borrower either (i) providing the Issuing Bank funds equal to 103% of the LC Exposure with respect to such Letter of Credit for deposit in a cash collateral account which cash collateral account will be held by the Issuing Bank as a pledged cash collateral account, and the Borrower hereby grants to the Collateral Agent a security interest in all cash and credit support now or hereafter deposited to any such collateral account, and applied to reimbursement of all drafts submitted under such outstanding Letter of Credit, or (ii) delivering to the Issuing Bank one or more letters of credit for the benefit of the Issuing Bank, issued by a bank reasonably acceptable to the Issuing Bank in its sole discretion, each in form and substance reasonably acceptable to the Issuing Bank in its sole discretion, unless the applicable Issuing Bank notifies the beneficiary thereof at least 30 days (or such longer period as may be specified in such Letter of Credit) prior to the then-applicable expiration date that such Letter of Credit will not be renewed.
(ii) If the Borrower so requests in any LC Request for a Standby Letter of Credit, the Issuing Bank may, in its sole and absolute discretion, agree to issue a Standby Letter of Credit that has automatic renewal provisions (each, an Auto-Renewal Letter of Credit); provided that any such Auto-Renewal Letter of Credit must permit the Issuing Bank to prevent any such renewal at least once in each twelve month period (commencing with the date of issuance of such Letter of Credit) by giving prior notice to the beneficiary thereof not later than a day in each such twelve month period to be agreed upon at the time such Standby Letter of Credit is issued. Once an Auto-Renewal Letter of Credit has been issued, unless otherwise directed by the Issuing Bank, the Borrower shall not be required to make a specific request to the Issuing Bank for any such renewal. Once an Auto-Renewal Letter of Credit has been issued, the Revolving Lenders shall be deemed to have authorized (but may not require) the Issuing Bank to permit the renewal of such Standby Letter of Credit at any time to an expiry date not later than the earlier of (i) one year from the date of such renewal and (ii) the Letter of Credit Expiration Date, unless otherwise extended pursuant to an LC Extension; provided that the Issuing Bank shall not permit any such renewal if (x) the Issuing Bank has determined that it would have no obligation at such time to issue such Standby Letter of Credit in its renewed form under the terms hereof (by reason of the provisions of Section 2.18(m) or otherwise), or (y) it has received notice on or before the day that is seven Business Days before the date which has been agreed upon pursuant to the proviso of the first sentence of this paragraph, from the Administrative Agent, any Lender or the Borrower that one or more of the applicable conditions specified in Section 4,02 are not then satisfied.
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(d) Participations. By the issuance of a Letter of Credit (or an amendment to a Letter of Credit increasing the amount thereof) and without any further action on the part of the Issuing Bank or the Lenders, the Issuing Bank hereby irrevocably grants to each Revolving Lender, and each Revolving Lender hereby acquires and is deemed to have purchased from the Issuing Bank, a participation in such Letter of Credit equal to such Revolving Lenders Pro Rata Percentage of the aggregate amount available to be drawn under such Letter of Credit in Dollars. In consideration and in furtherance of the foregoing (regardless of whether the conditions set forth in Section 4,02 shall have been satisfied), each Revolving Lender hereby absolutely and unconditionally agrees to pay to the Administrative Agent, for the account of the Issuing Bank, such Revolving Lenders Pro Rata Percentage of each LC Disbursement made by the Issuing Bank and not reimbursed by the Borrower on the date due as provided in Section 2.18(e) (the Unreimbursed Amount), or of any reimbursement payment required to be refunded to the Borrower for any reason. Each Revolving Lender acknowledges and agrees that its obligation to acquire participations pursuant to this paragraph in respect of Letters of Credit is absolute and unconditional and shall not be affected by any circumstance whatsoever, including any amendment, renewal or extension of any Letter of Credit or the occurrence and continuance of a Default, or any of the circumstances set forth in Section 2.18(f) or reduction or termination of the Commitments, or expiration, termination or cash collateralization of any Letter of Credit and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever.
(e) Reimbursement.
(i) If the Issuing Bank shall make any LC Disbursement in Dollars, the Borrower shall reimburse such LC Disbursement by paying to the Issuing Bank an amount equal to such LC Disbursement in Dollars not later than 1:00 p.m., New York City time, on the Business Day immediately following the day that the Borrower receives notice of such LC Disbursement; provided that the Borrower may, subject to the conditions to Borrowing set forth herein, request in accordance with Section 2.03 that such payment be financed with ABR Revolving Loans in an equal amount and, to the extent so financed, the Borrowers obligation to make such payment shall be discharged and replaced by the resulting ABR Revolving Loans.
(ii) If the Borrower fails to make such payment when due, the Issuing Bank shall notify the Administrative Agent in writing, and the Administrative Agent shall notify each Revolving Lender of the applicable LC Disbursement, the payment then due from the Borrower in respect thereof and such Revolving Lenders Pro Rata Percentage (based on the total aggregate amount of Revolving Commitments) thereof. Each Revolving Lender shall pay by wire transfer of immediately available funds to the Administrative Agent not later than 12:00 p.m., New York City time, on such date (or, if such Revolving Lender shall have received such notice later than 12:00 p.m., New York City time, on any day, not later than 11:00 a.m., New York City time, on the immediately following Business Day), an amount equal to such Revolving Lenders Pro Rata Percentage (based on the total aggregate amount of Revolving Commitments) of the unreimbursed LC Disbursement in the same manner as provided in Section 2.02(c) with respect to Revolving Loans made by such Revolving Lender, and the Administrative Agent will promptly pay to the Issuing Bank the amounts so received by it from the Revolving Lenders. Any amounts received by the Issuing Bank from the Borrower pursuant to the above paragraph prior to, concurrently with or after any Revolving Lender makes any payment pursuant to the preceding sentence will be promptly remitted by the Issuing Bank to the Administrative Agent and by the Administrative Agent to the Revolving Lenders that shall have made such payments.
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(iii) If any Revolving Lender shall not have made its Pro Rata Percentage of such LC Disbursement available as provided above, each of such Revolving Lender and the Borrower severally agree to pay interest on such amount, for each day from and including the date such amount is required to be paid in accordance with the foregoing to but excluding the date such amount is paid, to the Administrative Agent for the account of the Issuing Bank at (i) in the case of the Borrower, the rate per annum set forth in clause (h) below and (ii) in the case of such Lender, at a rate determined by the Administrative Agent in accordance with banking industry rules or practices on interbank compensation.
(f) Obligations Absolute. The Reimbursement Obligation of the Borrower and the Revolving Lenders as provided in Section 2.18(d) and (e) shall be absolute, unconditional and irrevocable, and shall be paid and performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of any Letter of Credit or this Agreement, or any term or provision therein or herein; (ii) any draft or other document presented under a Letter of Credit being proved to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; (iii) payment by the Issuing Bank under a Letter of Credit against presentation of a draft or other document that fails to comply with the terms of such Letter of Credit; (iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section 2.18(f), constitute a legal or equitable discharge of, or provide a right of setoff against, the obligations of the Borrower hereunder; (v) the fact that a Default shall have occurred and be continuing; or (vi) any material adverse change in the business, property, results of operations, prospects or condition, financial or otherwise, of Holdings and its Restricted Subsidiaries. None of the Agents, the Lenders, the Issuing Bank or any of their Affiliates shall have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder), any error in interpretation of technical terms or any consequence arising from causes beyond the control of the Issuing Bank; provided that the foregoing shall not be construed to excuse the Issuing Bank from liability to the Borrower to the extent of any direct damages (as opposed to consequential damages, claims in respect of which are hereby waived by the Borrower to the extent permitted by applicable Requirements of Law) suffered by the Borrower that are caused by the Issuing Banks failure to exercise care when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof. The parties hereto expressly agree that, in the absence of bad faith, gross negligence or willful misconduct on the part of the Issuing Bank (as finally determined by a court of competent jurisdiction (that is not subject to appeal)), the Issuing Bank shall be deemed to have exercised care in each such determination. In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented which appear on their face to be in substantial compliance with the terms of a Letter of Credit, the Issuing Bank may, in its reasonable discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit.
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(g) Disbursement Procedures. The Issuing Bank shall, promptly following its receipt thereof, examine all documents purporting to represent a demand for payment under a Letter of Credit. The Issuing Bank shall promptly give written notice to the Administrative Agent of such demand for payment and whether the Issuing Bank has made or will make an LC Disbursement thereunder, and the Administrative Agent shall promptly give the Borrower written notice of such demand for payment upon receiving such notice from the Issuing Bank; provided that any failure to give or delay in giving such notice shall not relieve the Borrower of its Reimbursement Obligation to the Issuing Bank and the Revolving Lenders with respect to any such LC Disbursement (other than with respect to the timing of such Reimbursement Obligation set forth in Section 2.18(e)).
(h) Interim Interest. If the Issuing Bank shall make any LC Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in full on the date such LC Disbursement is made, the unpaid amount thereof shall bear interest payable on demand, for each day from and including the date such LC Disbursement has been made to but excluding the date that the Borrower reimburses such LC Disbursement, at the Alternate Base Rate plus the Applicable Margin from the date of such LC Disbursement until the date that is three Business Days from the date of such LC Disbursement, and thereafter at the rate per annum determined pursuant to Section 2.06(c). Interest accrued pursuant to this paragraph shall be for the account of the Issuing Bank, except that interest accrued on and after the date of payment by any Revolving Lender pursuant to Section 2.18(e) to reimburse the Issuing Bank shall be for the account of such Lender to the extent of such payment.
(i) Cash Collateralization. If (1) any Event of Default shall occur and be continuing, on the Business Day that the Borrower receives notice from the Administrative Agent or the Required Lenders (or, if the maturity of the Loans has been accelerated, Revolving Lenders with LC Exposure representing greater than 50% of the total LC Exposure) demanding the deposit of cash collateral pursuant to this paragraph, (2) as of the Letter of Credit Expiration Date, any LC Obligation for any reason remains outstanding (other than any LC Obligation that is (x) backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or (y) rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank) or (3) there shall exist a Defaulting Lender, the Borrower shall immediately (and in the case of clause (3), upon the reasonable request of the Administrative Agent, solely to the extent of the LC Exposure of such Defaulting Lender, and solely to the extent such LC Exposure has not been reallocated to other Lenders pursuant to Section 2.19(b)(i) or cash collateralized pursuant to Section 2.19(b)(ii)) deposit on terms and in accounts satisfactory to the Collateral Agent, in the name of the Collateral Agent and for the benefit of the Revolving Lenders, an amount in cash equal to 103% of the LC Exposure as of such date plus any accrued and unpaid interest thereon; provided that the obligation to deposit such cash collateral shall become effective immediately, and such deposit shall become immediately due and payable, without demand or other notice of any kind, upon the occurrence and during the continuance of any Event of Default with respect to the Borrower described in Section 8.01(g) or (h). Funds so deposited shall be applied by the Collateral Agent to reimburse the Issuing Bank
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for LC Disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of outstanding Reimbursement Obligations or, if the maturity of the Loans has been accelerated (but subject to the consent of Revolving Lenders with LC Exposure representing greater than 50% of the total LC Exposure), be applied to satisfy other Obligations of the Borrower under this Agreement. If the Borrower is required to provide an amount of cash collateral hereunder as a result of the existence of an Event of Default, such amount plus any accrued interest or realized profits with respect to such amounts (to the extent not applied as aforesaid) shall be returned to the Borrower within three Business Days after all Events of Default have been cured or waived.
(j) Additional Issuing Banks. The Borrower may, at any time and from time to time, designate one or more additional Revolving Lenders (subject to the consent of each such Revolving Lender in its sole discretion) reasonably acceptable to the Administrative Agent to act as an issuing bank with respect to Letters of Credit under the terms of this Agreement. Any Revolving Lender designated as an issuing bank with respect to Letters of Credit pursuant to this clause (j) shall have all the rights and obligations of the Issuing Bank under the Loan Documents with respect to Letters of Credit issued or to be issued by it, and all references in the Loan Documents to the term Issuing Bank shall, with respect to such Letters of Credit, be deemed to refer to such Revolving Lender in its capacity as the Issuing Bank, as the context shall require. If at any time there is more than one Issuing Bank hereunder, the Borrower may, in its discretion and subject to the terms and conditions set forth herein, select which Issuing Bank to request to issue any particular Letter of Credit.
(k) Resignation or Removal of the Issuing Bank. The Issuing Bank may resign as Issuing Bank hereunder at any time upon at least 30 days prior written notice to the Lenders, the Administrative Agent and the Borrower. The Issuing Bank may be replaced at any time by the Borrower. The Borrower shall notify the Administrative Agent and then the Administrative Agent shall notify the Lenders of any such replacement of the Issuing Bank. At the time any such resignation or replacement shall become effective, the Borrower shall pay all unpaid fees accrued for the account of the replaced Issuing Bank pursuant to Section 2.05(d). From and after the effective date of any such resignation or replacement, as applicable, (i) the successor Issuing Bank shall have all of the rights and obligations of the Issuing Bank under this Agreement with respect to Letters of Credit to be issued by it thereafter and (ii) references herein and in the other Loan Documents to the term Issuing Bank shall be deemed to refer to such successor or to any previous Issuing Bank, or to such successor and all previous Issuing Banks, as the context shall require. After the resignation or replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto and shall continue to have all of the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit issued by it prior to such resignation or replacement, but shall not be required to issue additional Letters of Credit.
(l) Issuing Bank. The Issuing Bank shall act on behalf of the Lenders with respect to any Letters of Credit issued by it and the documents associated therewith, and the Issuing Bank shall have all of the benefits and immunities (A) provided to the Administrative Agent in Article IX with respect to any acts taken or omissions suffered by the Issuing Bank in connection with Letters of Credit issued by it or proposed to be issued by it and documents pertaining to such Letters of Credit as fully as if the term Administrative Agent as used in Article IX included the Issuing Bank with respect to such acts or omissions, and (B) as additionally provided herein with respect to the Issuing Bank. The Issuing Bank may, but shall not be obligated to, send a Letter of Credit or conduct any communication to or from the beneficiary via a Society for Worldwide Interbank Financial Telecommunication message or overnight courier, or any other commercially reasonable means of communicating with a beneficiary.
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(m) Other. The Issuing Bank shall be under no obligation to issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain the Issuing Bank from issuing such Letter of Credit, or any Requirement of Law applicable to the Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over the Issuing Bank shall prohibit, or request that the Issuing Bank refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon the Issuing Bank with respect to such Letter of Credit any restriction, reserve or capital requirement (for which the Issuing Bank is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon the Issuing Bank any unreimbursed loss, cost or expense which was not applicable on the Closing Date, for which the Issuing Bank is not otherwise compensated hereunder, and which the Issuing Bank in good faith deems material to it; or
(ii) the issuance of such Letter of Credit would violate one or more policies of general application of the Issuing Bank now or hereafter applicable.
The Issuing Bank shall be under no obligation to amend any Letter of Credit if (A) the Issuing Bank would have no obligation at such time to issue such Letter of Credit in its amended form under the terms hereof, or (B) the beneficiary of such Letter of Credit does not accept the proposed amendment to such Letter of Credit. Unless otherwise expressly agreed by the Issuing Bank and the Borrower when a Letter of Credit is issued, (i) the rules of the ISP shall apply to each Standby Letter of Credit and (ii) the rules of the UCP shall apply to each Commercial Letter of Credit. Notwithstanding the foregoing, the Issuing Bank shall not be responsible to the Borrower for, and the Issuing Banks rights and remedies against the Borrower shall not be impaired by, any action or inaction of the Issuing Bank required or permitted under any law, order, or practice that is required or permitted to be applied to any Letter of Credit or this Agreement, including the Requirements of Law or any order of a jurisdiction where the Issuing Bank or the beneficiary is located, the practice stated in the ISP or in the decisions, opinions, practice statements, or official commentary of the ICC Banking Commission, the Bankers Association for Finance and TradeInternational Financial Services Association (BAFT-IFSA), or the Institute of International Banking Law & Practice, whether or not any Letter of Credit chooses such law or practice.
(n) Letters of Credit Issued for Wholly Owned Subsidiaries of Holdings. Notwithstanding that a Letter of Credit issued or outstanding hereunder is in support of any obligations of, or is for the account of, a Wholly Owned Restricted Subsidiary of Holdings that is a Guarantor hereunder, the Borrower and each other applicant under such Letter of Credit shall be obligated to reimburse the Issuing Bank hereunder for any and all drawings under such Letter of Credit. The Borrower hereby acknowledges that the issuance of Letters of Credit for the account of Wholly Owned Subsidiaries of Holdings inures to the benefit of the Borrower, and that the Borrowers business derives substantial benefits from the businesses of any such Wholly Owned Subsidiaries of Holdings.
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(o) [Reserved].
(p) Provisions Related to Extended Tranches of Revolving Commitments. If the maturity date in respect of any tranche of Revolving Commitments occurs prior to the expiration of any Letter of Credit, then (i) if one or more other tranches of Revolving Commitments in respect of which the maturity date shall not have occurred are then in effect, (x) the outstanding Swing Line Loans and Revolving Loans shall be repaid pursuant to Section 2.10(b)(ii) on such maturity date to the extent and in an amount sufficient to permit the reallocation of the LC Exposure relating to the outstanding Letters of Credit contemplated by clause (y) below and (y) such Letters of Credit shall automatically be deemed to have been issued (including for purposes of the obligations of the Revolving Lenders to purchase participations therein and to make payments in respect thereof pursuant to Section 2.18(d)) under (and ratably participated in by Revolving Lenders pursuant to) the Revolving Commitments in respect of such non-terminating tranches up to an aggregate amount not to exceed the aggregate principal amount of the Revolving Commitments in respect of such non-terminating tranches at such time (it being understood that (1) the participations therein of Revolving Lenders under the maturing tranche shall be correspondingly released and (2) no partial face amount of any Letter of Credit may be so reallocated) and (ii) to the extent not reallocated pursuant to the immediately preceding clause (i), but without limiting the obligations with respect thereto, the Borrower shall provide the Issuing Bank with either (x) funds equal to 103% of the LC Exposure with respect to each such Letter of Credit for deposit in a cash collateral account which cash collateral account will be held by the Issuing Bank as a pledged cash collateral account (and the Borrower hereby grants to the Collateral Agent a security interest in all cash and credit support now or hereafter deposited to any such collateral account, and applied to reimbursement of all drafts submitted under any such Letter of Credit) or (y) one or more letters of credit, issued by a bank reasonably acceptable to the Issuing Bank in its sole discretion, for the benefit of the Issuing Bank with aggregate face amounts equal to 103% of the LC Exposure with respect to each such Letter of Credit, each in form and substance reasonably acceptable to the Issuing Bank in its sole discretion, which may be drawn by the Issuing Bank to satisfy any obligations of the Borrower in respect of such Letter of Credit. If, for any reason, such cash collateral or backstop letters of credit are not provided or the reallocation does not occur, the Revolving Lenders under the maturing tranche shall continue to be responsible for their participating interests in the Letters of Credit; provided that, notwithstanding anything to the contrary contained herein, upon any subsequent repayment of the Revolving Loans, the reallocation set forth in clause (i) shall automatically and concurrently occur to the extent of such repayment (it being understood that no partial face amount of any Letter of Credit may be so reallocated). Except to the extent of reallocations of participations pursuant to clause (i) of the second preceding sentence, the occurrence of a maturity date with respect to a given tranche of Revolving Commitments shall have no effect upon (and shall not diminish) the percentage participations of the Revolving Lenders in any Letter of Credit issued before such maturity date. Commencing with the maturity date of any tranche of Revolving Commitments, the LC Sublimit under any tranche of Revolving Commitments that has not so then matured shall be in an amount agreed between such Revolving
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Lenders, the Issuing Bank and the Borrower; provided that in no event shall such sublimit be less than the sum of (x) the LC Exposure with respect to the Revolving Lenders under such extended tranche immediately prior to such maturity date and (y) the face amount of the Letters of Credit reallocated to such tranche of Revolving Commitments pursuant to clause (i) of the second preceding sentence above (assuming Swing Line Loans and Revolving Loans are repaid in accordance with clause (i)(x)).
Section 2.19 Defaulting Lenders. Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the following provisions shall apply for so long as such Lender is a Defaulting Lender:
(a) the Commitment Fee shall cease to accrue on the Commitment of such Lender so long as it is a Defaulting Lender (except to the extent such amount is payable to the Issuing Bank pursuant to clause (b)(v) below) and such Defaulting Lender shall not be entitled to receive any Commitment Fee pursuant to Section 2.05(a);
(b) if any Swing Line Exposure or LC Exposure exists at the time a Lender becomes a Defaulting Lender then:
(i) all or any part of such Defaulting Lenders participation in Swing Line Exposure and LC Exposure shall be reallocated among the non-Defaulting Lenders in accordance with their respective Pro Rata Percentages, but only to the extent that (y) such reallocation does not cause the aggregate Revolving Exposure of any nonDefaulting Lender to exceed such non-Defaulting Lenders Revolving Commitment and (z) to the extent requested in writing by the Administrative Agent, the Borrower shall confirm that the conditions set forth in Section 4,02 are satisfied at the time of such reallocation and if the Borrower cannot confirm such conditions have been satisfied (which shall not constitute a Default or an Event of Default) and such conditions have not otherwise been waived by the Required Revolving Lenders, then clause (ii) below shall apply;
(ii) if the reallocation described in clause (i) above cannot, or can only partially, be effected, the Borrower shall within one Business Day following notice by the Administrative Agent, (a) prepay such Swing Line Exposure of such Defaulting Lender and (b) cash collateralize such Defaulting Lenders LC Exposure (in each case after giving effect to any partial reallocation pursuant to clause (i) above) in accordance with the procedures set forth in Section 2.18(i)for so long as such LC Exposure is outstanding;
(iii) if any portion of such Defaulting Lenders LC Exposure is cash collateralized pursuant to clause (ii) above, the Borrower shall not be required to pay the LC Participation Fee with respect to such portion of such Defaulting Lenders LC Exposure so long as it is cash collateralized;
(iv) if any portion of such Defaulting Lenders LC Exposure is reallocated to the non-Defaulting Lenders pursuant to clause (i) above, then the LC Participation Fee with respect to such portion shall be allocated among the non-Defaulting Lenders in accordance with their Pro Rata Percentages;
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(v) if any portion of such Defaulting Lenders LC Exposure is neither cash collateralized nor reallocated pursuant to this Section 2.19(b), then, without prejudice to any rights or remedies of the Issuing Bank or any Lender hereunder, the Commitment Fee that otherwise would have been payable to such Defaulting Lender (with respect to the portion of such Defaulting Lenders Revolving Commitment that was utilized by such LC Exposure) and the LC Participation Fee payable with respect to such Defaulting Lenders LC Exposure shall be payable to the Issuing Bank until such LC Exposure is cash collateralized and/or reallocated;
(vi) so long as any Lender is a Defaulting Lender, the Swing Line Lender shall not be required to fund any Swing Line Loan and the Issuing Bank shall not be required to issue, amend or increase any Letter of Credit, in each case unless it is satisfied that the related exposure will be 100% covered by the Revolving Commitments of the non-Defaulting Lenders and/or cash collateralized in accordance with this Section 2.19(b), and participations in any such newly issued or increased Letter of Credit or newly made Swing Line Loan shall be allocated among non-Defaulting Lenders in accordance with their respective Pro Rata Percentages (and Defaulting Lenders shall not participate therein); and
(vii) any amount payable to such Defaulting Lender hereunder (whether on account of principal, interest, fees or otherwise and including any amount that would otherwise be payable to such Defaulting Lender pursuant to Section 2.14(d) but excluding Section 2.16(b)) may, in lieu of being distributed to such Defaulting Lender, be retained by the Administrative Agent in a segregated non-interest bearing account and, subject to any applicable Requirements of Law, be applied at such time or times as may be determined by the Administrative Agent (i) first, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder, (ii) second, pro rata, to the payment of any amounts owing by such Defaulting Lender to the Issuing Bank or Swing Line Lender hereunder, (iii) third, to the funding of any Loan or the funding or cash collateralization of any participation in any Letter of Credit in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent, (iv) fourth, if so determined by the Administrative Agent and the Borrower, held in such account as cash collateral for future funding obligations of the Defaulting Lender under this Agreement, (v) fifth, pro rata, to the payment of any amounts owing to the Borrower, the Issuing Bank, the Swing Line Lender or the Lenders as a result of any judgment of a court of competent jurisdiction obtained by the Borrower, the Issuing Bank, the Swing Line Lender or any Lender against such Defaulting Lender as a result of such Defaulting Lenders breach of its obligations under this Agreement and (vi) sixth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if such payment is (x) a prepayment of the principal amount of any Loans or Reimbursement Obligations in respect of LC Disbursements which a Defaulting Lender has funded in respect of its participation obligations and (y) made at a time when the conditions set forth in Section 4,02 are satisfied, such payment shall be applied solely to prepay the Loans of, and Reimbursement Obligations owed to, all non-Defaulting Lenders pro rata prior to being applied to the prepayment of any Loans, or Reimbursement Obligations owed to, any Defaulting Lender.
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(c) such Defaulting Lender shall be deemed not to be a Lender, and the amount of such Defaulting Lenders Revolving Commitment and Revolving Loans and/or Term Loan Commitments and Term Loans and/or Swing Line Commitments and Swing Line Loans shall be excluded, for purposes of voting, and the calculation of voting, on any matters (including the granting of any consents or waivers) with respect to any of the Loan Documents, except as otherwise set forth in Section 10.02(b).
(d) to the extent permitted by applicable Requirements of Law, until such time as the Default Excess with respect to such Defaulting Lender shall have been reduced to zero, (A) any voluntary prepayment of the Loans pursuant to Section 2.10(a) shall, if the Borrower so directs at the time of making such voluntary prepayment, be applied to the Loans of other Lenders in accordance with Section 2.10(a) as if such Defaulting Lender had no Loans outstanding and the Revolving Exposure of such Defaulting Lender were zero, and (B) any portion of any mandatory prepayment of the Loans pursuant to Section 2.10 that would be applied to the Loans of any Defaulting Lender if such Defaulting Lender had funded all of its defaulted Revolving Loans shall, if the Borrower so directs at the time of making such mandatory prepayment, be (i) applied to the Loans of other Lenders (but not to the Loans of such Defaulting Lender) in accordance with Section 2.10 as if such Defaulting Lender had no Loans outstanding and the Revolving Exposure of such Defaulting Lender were zero or (ii) retained by the Administrative Agent in a segregated non-interest-bearing account.
(e) Subject to Section 10,18, no reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a non-Defaulting Lender as a result of such non-Defaulting Lenders increased exposure following such reallocation.
In the event that the Administrative Agent or the Issuing Bank, as the case may be, and the Borrower each agrees in writing (provided that the Borrowers agreement shall not be unreasonably withheld) that a Defaulting Lender has adequately remedied all matters that caused such Lender to be a Defaulting Lender, then the Swing Line Exposure and the LC Exposure of the Lenders shall be readjusted to reflect the inclusion of such Lenders Commitment and on such date such Lender shall purchase at par such of the Loans of the other Lenders (except for Swing Line Loans) as the Administrative Agent shall determine may be necessary in order for such Lender to hold such Loans in accordance with its Pro Rata Percentage. The rights and remedies against a Defaulting Lender under this Section 2.19 are in addition to other rights and remedies that the Borrower, the Administrative Agent, the Issuing Bank, and the non-Defaulting Lenders may have against such Defaulting Lender. The operation of this Section 2.19 shall not be construed to relieve or excuse the performance by such Defaulting Lender or any other Lender of its duties and obligations hereunder. Any failure by a Defaulting Lender to fund amounts that it was obligated to fund hereunder shall constitute a material breach by such Defaulting Lender of this Agreement and shall entitle the Borrower, at its option, to arrange for a substitute Lender to replace such Defaulting Lender pursuant to Section 2.16(b). The arrangements permitted or required by this Section 2.19 shall be permitted under this Agreement, notwithstanding any limitation on Liens or the pro rata sharing provisions hereof or otherwise.
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Section 2.20 Increase in Commitments.
(a) Borrower Request. The Borrower may by written notice to the Administrative Agent elect to request the establishment of one or more new Term Loan Commitments under a new term facility or under the existing term facility or any increase under an existing tranche of Term Loans (each, an Incremental Term Loan Commitment) and/or one or more new Revolving Loan Commitments under a new revolving facility (an Additional Revolving Commitment) or under the then existing revolving facility (a Revolving Commitment Increase and together with any Additional Revolving Commitment, each an Incremental Revolving Loan Commitment and together with any Incremental Term Loan Commitment, the Incremental Facilities), in an aggregate amount not to exceed the Maximum Incremental Facilities Amount (the date of establishment of any such Incremental Facility, an Increase Effective Date). Any existing Lender approached to provide all or a portion of such Incremental Term Loan Commitments or Incremental Revolving Loan Commitments may elect or decline, in its sole discretion, to provide such Incremental Term Loan Commitment or Incremental Revolving Loan Commitment, and, to the extent any such Incremental Term Loan Commitments or Incremental Revolving Loan Commitments are not provided by existing Lenders, each Lender providing such commitments shall otherwise constitute an Eligible Assignee hereunder; provided that (i) the Administrative Agent shall have consented to such Eligible Assignee providing such Incremental Term Loan Commitment or Incremental Revolving Loan Commitment, as applicable, if such consent would be required under Section 10.04 for an assignment of such type of Loans or Commitments, as applicable, to such Eligible Assignee and (ii) any Incremental Facilities to be provided by Sponsor Investors shall be subject to the terms of Section 10.04(b) as if such Incremental Facilities were being assigned to such Sponsor Investor; provided further that, for the avoidance of doubt, the Borrower shall not be required to offer the opportunity to participate in any Incremental Facility to any existing Lenders.
(b) Conditions. Such Incremental Term Loan Commitments and Incremental Revolving Loan Commitments shall become effective as of such Increase Effective Date; provided that:
(i) subject to Section 1,06, and (solely in the case of any Incremental Facility (other than any Revolving Commitment Increase) incurred in connection with a Limited Condition Transaction) unless (other than in the case of an Event of Default under Section 8.01(a), (b), (g) or (h)) waived by the lenders in respect of such Incremental Facility, no Event of Default (or, in the case of an Incremental Facility (other than a Revolving Commitment Increase) the proceeds of which will be used for a Permitted Acquisition or similar Investment, no Event of Default under Section 8.01(a), (b), (g) or (h)) shall have occurred and be continuing at the time of funding or immediately after giving effect thereto; provided that any Limited Condition Transaction remains subject to the terms of Section 1,06 hereof;
(ii) the proceeds of the Incremental Term Loans and/or Incremental Revolving Loans may be used for working capital needs and other general corporate purposes (including Capital Expenditures, acquisitions and other Investments, working capital and/or purchase price adjustments, Dividends, prepayments of Indebtedness (including Restricted Debt Payments) and related fees and expenses) and for any other purpose not prohibited by the Loan Documents;
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(iii) the Borrower shall deliver or cause to be delivered any customary amendments to the Loan Documents or other documents reasonably requested by the Administrative Agent or any Incremental Term Loan Lender or Incremental Revolving Loan Lender in connection with any such transaction;
(iv) any such Incremental Term Loans shall be in an aggregate amount of at least $5,000,000 and integral multiples of $1,000,000 above such amount (except, in each case, such minimum amount and integral multiples amount shall not apply when the Borrower uses all of the Incremental Term Loan Commitments available at such time);
(v) any Incremental Facilities may be (A) secured on a pari passu basis with the Term Loans, (B) secured on a junior basis to the Term Loans, or (C) unsecured and, in the case of clauses (B) and (C), shall be established as a separate facility from the then existing Term Loans or Revolving Loans, as applicable; provided that any such separate facility (x) subject to the proviso contained in Section 2.20(c)(ii) does not mature (and does not require any mandatory redemptions, sinking funds or similar payments or offers to purchase (excluding customary asset sale and change of control provisions and similar provisions and, if applicable, AHYDO catch-up payments)) on or prior to the date that is 91 days after the Latest Maturity Date of, or have a shorter Weighted Average Life to Maturity than, any existing Term Loans or Revolving Loans, as applicable, and (y) to the extent secured, shall be subject to intercreditor terms reasonably agreed among the agent under such facility, the Borrower and the Administrative Agent. No Incremental Facility shall be secured by a Lien on any assets of the Borrower or any Guarantor not constituting Collateral or incurred or guaranteed by any person other than the Borrower or the Guarantors; and
(vi) subject (other than in the case of any Revolving Commitment Increase) to customary SunGard limitations (to the extent agreed to by the lenders providing the applicable Incremental Facility and to the extent the proceeds of the applicable Incremental Facility are being used to finance a Permitted Acquisition or other Investment), each of the representations and warranties made by any Credit Party set forth in Article III hereof or in any other Loan Document shall be true and correct in all material respects (except that any representation and warranty that is qualified as to materiality or Material Adverse Effect shall be true and correct in all respects) on and as of the date of such credit extension (or, if incurred in connection with a Limited Condition Transaction, the LCT Test Date) with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date, in which case such representations and warranties shall be true and correct in all material respects (except that any representation and warranty that is qualified as to materiality or Material Adverse Effect shall be true and correct in all respects) as of such earlier date.
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(c) Terms of New Term Loans and Commitments. The terms and provisions of Loans made pursuant to such Incremental Term Loan Commitments shall be subject to Section 2.20(f) and as follows:
(i) the terms and provisions of Loans made pursuant to Incremental Term Loan Commitments (Incremental Term Loans) shall be, except as otherwise set forth herein (including Section 2.20(f)), on terms and pursuant to documentation to be determined by the Borrower and the lenders providing such Incremental Term Loans; provided that, to the extent such terms and documentation are not consistent with the existing Term Loans (but excluding any terms applicable only after the applicable Term Loan Maturity Date), they shall either, at the option of the Borrower, (A) reflect market terms and conditions (taken as a whole) at the time of (subject to Section 1,06) incurrence or effectiveness (as determined by the Borrower in good faith) or (B) be reasonably satisfactory to the Administrative Agent (it being understood that no consent shall be required from the Administrative Agent for any terms or conditions that are not market terms if the Lenders under the Term Loans existing on the date of incurrence of such Incremental Term Loans receive the benefit of such terms or conditions through their addition to the Loan Documents);
(ii) the maturity date of any Incremental Term Loans shall be no earlier than the Latest Maturity Date applicable to the Term Loans and the Weighted Average Life to Maturity of such Incremental Term Loans shall be no shorter than the then remaining Weighted Average Life to Maturity of the Term Loans; provided that the limitations in this clause (ii) shall not apply to any customary bridge facility so long as the long-term debt into which such customary bridge facility is to be converted satisfies the provisions of this clause; and
(iii) any Incremental Term Loans that are pari passu in right of payment and security with the Term Loans may participate on a pro rata basis, greater than pro rata basis or less than pro rata basis in any voluntary prepayment of Term Loans hereunder and may participate on a pro rata basis or less than pro rata basis (but not on a greater than pro rata basis) in any mandatory prepayments of Term Loans hereunder.
(d) Terms of New Revolving Loans and Commitments, (i) Any Additional Incremental Revolving Loan Commitments shall be, except as otherwise set forth herein (including Section 2.20(f)), on terms and pursuant to documentation to be determined by the Borrower and the lenders providing such Additional Incremental Revolving Commitments; provided that, to the extent such terms and documentation are not consistent with the existing Term Loans (but excluding any terms applicable only after the applicable Revolving Maturity Date, they shall either (A) reflect (as determined by the Borrower in good faith) market terms and conditions (taken as a whole) at the time of (subject to Section 1.06) incurrence or effectiveness or (B) be reasonably satisfactory to the Administrative Agent (except, in the case of either clause (A) or (B), for covenants or other provisions applicable only to periods after the applicable Revolving Maturity Date) (except for covenants or other provisions applicable only to periods after the Revolving Maturity Date) (it being understood that no consent shall be required from the Administrative Agent for any terms or conditions if the Lenders under the Revolving
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Commitments existing on the date of incurrence of such Incremental Revolving Commitments receive the benefit of such terms or conditions through their addition to the Loan Documents) and (ii)(A) in the case of a Revolving Commitment Increase, (I) the maturity date of such Revolving Commitment Increase shall be the same as the Revolving Maturity Date applicable to the Revolving Commitments subject to such increase, such Revolving Commitment Increase shall require no scheduled amortization or mandatory commitment reduction prior to the final Revolving Maturity Date applicable to the Revolving Commitments subject to such increase, and the Revolving Commitment Increase shall be on the exact same terms and pursuant to the exact same documentation applicable to the Revolving Commitments subject to such increase (it being understood that, if required to consummate a Revolving Commitment Increase, the pricing, interest rate margins, rate floors and undrawn fees on the Revolving Commitments being increased may be increased for all Revolving Lenders under the Revolving Commitments being increased, and additional upfront or similar fees may be payable to the Lenders participating in the Revolving Commitment Increase without any requirement to pay such amounts to any Revolving Lenders that do not participate in such increase), and (II) each of the applicable Revolving Lenders shall be deemed to have assigned to each Lender with Incremental Revolving Loan Commitments in respect of a Revolving Incremental Increase, and each such Lender shall be deemed to have purchased from each of the applicable Revolving Lenders, at the principal amount thereof (together with accrued interest), such interests in the applicable Revolving Loans outstanding on the effective date of such increase as shall be necessary in order that, immediately after giving effect to all such assignments and purchases, such Revolving Loans will be held by existing applicable Revolving Lenders and Incremental Revolving Loan Lenders in respect of such Revolving Incremental Increase ratably in accordance with their Revolving Commitments after giving effect to the addition of such Incremental Revolving Loan Commitments to the Revolving Commitments and (B) in the case of an Additional Revolving Commitment, the maturity date of such Additional Revolving Commitment shall be no earlier than the Revolving Maturity Date and such Additional Revolving Commitment shall require no scheduled amortization or mandatory commitment reduction prior to the final Revolving Maturity Date; provided, that the Administrative Agents, the Issuing Banks, the Swing Line Lenders and the Borrowers consent shall be required to each Person providing any portion of an Incremental Revolving Loan Commitment to the same extent, and in the same manner, as if such Person had taken assignment of Revolving Commitments pursuant to Section 10.04. Each Incremental Revolving Loan Commitment shall be deemed for all purposes a Revolving Commitment and each Loan made thereunder (an Incremental Revolving Loan) shall be deemed, for all purposes, a Revolving Loan.
(e) Joinder. Such Incremental Term Loan Commitments and Incremental Revolving Loan Commitments shall be effected by a joinder agreement (the Increase Joinder) executed by the Borrower, the Administrative Agent and each lender making such Incremental Term Loan Commitment or Incremental Revolving Loan Commitment, in form and substance reasonably satisfactory to each of them. The Increase Joinder may, without the consent of any other Lenders, effect such amendments to this Agreement and the other Loan Documents (i) as may be necessary or appropriate (which may be in the form of an amendment and restatement of this Agreement) (including with respect to pro rata payments, repayments, borrowings and commitment reductions of Revolving Commitments (and Revolving Loans thereunder) and Incremental Revolving Loan Commitments (and loans thereunder)), in the opinion of the Administrative Agent and the Borrower, to effect the provisions of this Section 2.20 and (ii) so long as such amendments are not adverse to the Lenders, such other changes as may be necessary, as reasonably determined by the Borrower and the Administrative Agent, to maintain the fungibility of any Incremental Term Loans with any Tranche of then-outstanding Term Loans. This Section 2.20(e) shall supersede any provisions in Section 10.02 to the contrary.
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(f) Yield. If the initial Yield (as defined below) on any Incremental Term Loans that are secured on a pari passu basis with the Secured Obligations exceeds the then applicable Yield on the Term Loans by more than 50 basis points (the amount of such excess above 50 basis points being referred to herein as the Yield Differential), then the Applicable Margin then in effect for such tranche of Term Loans shall automatically be increased by the Yield Differential. Yield shall mean, with respect to any credit facility, the then effective yield on such facility consistent with generally accepted financial practice, it being understood that (x) customary arrangement, commitment, structuring, underwriting, ticking, unused line and amendment fees paid or payable to one or more arrangers (or their Affiliates) (regardless of whether such fees are paid to or shared in whole or in part with any lender) in their respective capacities as such in connection with the applicable facility and any other fees that are not generally payable to all lenders (or their Affiliates) ratably with respect to any such facility and that are paid or payable in connection with such facility shall be excluded, (y) original issue discount and upfront fees paid or payable to the lenders thereunder shall be included (with original issue discount and upfront fees being equated to interest based on assumed four-year life to maturity (or, if less, the remaining life to maturity) without any present value discount) and (z) to the extent that the Adjusted LIBO Rate for a three month interest period on the closing date of any such Incremental Term Loan Commitment is less than the interest rate floor, if any, applicable to any such Incremental Term Loan Commitments, the amount of such difference shall be deemed added to the interest rate margins for the Loans under such Incremental Term Loan Commitment.
(g) Equal and Ratable Benefit. Subject to Section 2.20(b)(v), the Loans and Commitments established pursuant to this Section 2.20 shall constitute Loans and Commitments under, and shall be entitled to all the benefits afforded by, this Agreement and the other Loan Documents. The Borrower and the other Credit Parties shall take any actions reasonably required by the Administrative Agent to ensure and/or demonstrate that the Lien and security interests granted by the Security Documents continue to be perfected under the UCC or otherwise after giving effect to the establishment of any such Class of Incremental Term Loans or Incremental Revolving Loans or any such Incremental Term Loan Commitments or Incremental Revolving Loan Commitments.
Section 2.21 Extension Amendments.
(a) The Borrower may at any time and from time to time request that all or a portion, including one or more Tranches, of the Loans (including any Extended Loans), in each case existing at the time of such request (each such Tranche of existing Loans, an Existing Tranche and the Loans of any such Tranche, the Existing Loans) be converted to extend the termination date thereof and/or the scheduled maturity date(s) of any payment of principal with respect to all or a portion of any such Existing Tranche (any such Existing Tranche or portion thereof which has been so extended, an Extended Tranche and the Loans of such Tranche or
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portion thereof, the Extended Loans) and to provide for other terms consistent with this Section 2.21. In order to establish any Extended Tranche, the Borrower shall provide a notice to the Administrative Agent (who shall provide a copy of such notice to each of the Lenders of the applicable Existing Tranche) (an Extension Request) setting forth the proposed terms of the Extended Tranche to be established, which terms (other than as provided in clause (C) below) shall be (taken as a whole) substantially similar to, or (taken as a whole) no more favorable (as reasonably determined by the Borrower) to the Lenders providing the Loans that are being extended or replaced (in each case, other than terms applicable only to periods after the Latest Maturity Date of the Existing Loans) to those applicable to the Existing Tranche from which they are to be extended (the Specified Existing Tranche), except (w) the final maturity date of the Extended Tranche may be later than the final maturity date of the Specified Existing Tranche, (x)(A) the interest margins with respect to the Extended Tranche may be higher or lower than the interest margins for the Specified Existing Tranche, (B) subject to clause (3) of the following proviso, the prepayment terms may be different and/or (C) additional pricing and fees may be payable to the Lenders providing the Extended Tranche in addition to or in lieu of any increased margins contemplated by the preceding clause (A), (y) the commitment fee, if any, with respect to the Extended Tranche may be higher or lower than the commitment fee, if any, for the Specified Existing Tranche and (z) the provisions for optional and mandatory prepayments may provide for such payments to be directed first to the Specified Existing Tranche prior to being applied to the Extended Tranche, in each case to the extent provided in the applicable Extension Amendment; provided that, notwithstanding anything to the contrary in this Section 2.21 or otherwise, (1) the Extended Tranche shall not be, (y) in the case of any Extended Tranche relating to Term Loans, in an amount less than $5,000,000 and (z) in the case of any Extended Tranche relating to Revolving Loans hereunder, in an amount less than $1,000,000, (2) no Extended Tranche shall be secured by or receive the benefit of any collateral, credit support or security that does not secure or support the Existing Tranches, (3) the mandatory prepayment or the commitment reduction of any of Loans or Commitments under the Extended Tranches shall be made on a pro rata basis with all other outstanding Loans or Commitments respectively; provided that Extended Loans may, if the Extending Lenders making such Extended Loans so agree, participate on a less than pro rata basis in any mandatory prepayment or commitment reductions hereunder, (4) the final maturity of any Extended Tranche shall not be earlier than, and, if such Extended Tranche is a term facility, shall not have a Weighted Average Life to Maturity shorter than, the applicable Specified Existing Tranche, and, if such Extended Tranche is a revolving facility, shall not have any scheduled amortization or mandatory commitment reduction prior to the final maturity of the applicable Specified Existing Tranche, (5) each Lender in the Specified Existing Tranche shall be permitted to participate in the Extended Tranche in accordance with its pro rata share of the Specified Existing Tranche and (6) assignments and participations of Extended Tranches shall be governed by the same assignment and participation provisions applicable to Loans and Commitments hereunder as set forth in Section 10.04. No Lender shall have any obligation to agree to have any of its Existing Loans or, if applicable, commitments of any Existing Tranche converted into an Extended Tranche pursuant to any Extension Request. Any Extended Tranche shall constitute a separate Tranche of Loans (and, if applicable, commitments) from the Specified Existing Tranches, from any other Existing Tranches, and from any other Extended Tranches so established on or after such date.
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(b) The Borrower shall provide the applicable Extension Request at least five Business Days (or such shorter period as may be agreed by the Administrative Agent in its sole discretion) prior to the date on which Lenders under the applicable Existing Tranche or Existing Tranches are requested to respond. Any Lender (an Extending Lender) wishing to have all or a portion of its Specified Existing Tranche converted into an Extended Tranche shall notify the Administrative Agent (an Extension Election) on or prior to the date specified in such Extension Request of the amount of its Specified Existing Tranche that it elects to convert into an Extended Tranche. In the event that the aggregate amount of the Specified Existing Tranche subject to Extension Elections exceeds the amount of Extended Tranches requested pursuant to the Extension Request, the Specified Existing Tranches subject to Extension Elections shall be converted to Extended Tranches on a pro rata basis based on the amount of Specified Existing Tranches included in each such Extension Election.
(c) Extended Tranches shall be established pursuant to an amendment (an Extension Amendment) to this Agreement (which may include amendments to provisions related to maturity, interest margins, fees or prepayments and which, except to the extent expressly contemplated by the penultimate sentence of this Section 2.21(c) and notwithstanding anything to the contrary set forth in Section 10.02, shall not require the consent of any Lender other than the Extending Lenders with respect to the Extended Tranches established thereby) executed by the Credit Parties, the Administrative Agent, and the Extending Lenders. It is understood and agreed that each Lender has consented for all purposes requiring its consent, and shall at the effective time thereof be deemed to consent to each amendment to this Agreement and the other Loan Documents authorized by this Section 2.21 and the arrangements described above in connection therewith. This Section 2.21(c) shall supersede any provisions in Section 10.02 to the contrary.
(d) Notwithstanding anything to the contrary contained in this Agreement, (A) on any date on which any Existing Tranche is converted to extend the related scheduled maturity date(s) in accordance with clause (a) above (an Extension Date), in the case of the Specified Existing Tranche of each Extending Lender, the aggregate principal amount of such Specified Existing Tranche shall be deemed reduced by an amount equal to the aggregate principal amount of such Specified Existing Tranche so converted by such Lender into an Extended Tranche or Extended Tranches on such date, and such Extended Tranche or Extended Tranches shall be established as a separate Tranche or Tranches from the Specified Existing Tranche and from any other Existing Tranches and any other Extended Tranches so established on or after such date, and (B) if, on any Extension Date, any Revolving Loans of any Extending Lender are outstanding under the applicable Specified Existing Tranches, such loans (and any related participations) shall be deemed to be allocated as Extended Loans (and related participations) and Existing Loans (and related participations) in the same proportion as such Extending Lenders applicable Specified Existing Tranches to the applicable Extended Tranches so converted by such Lender on such date.
(e) If, in connection with any proposed Extension Amendment, any Lender declines to consent to the applicable extension on the terms and by the deadline set forth in the applicable Extension Request (each such Lender, a Non-Extending Lender) then the Borrower may, on notice to the Administrative Agent and the Non-Extending Lender, (A) replace such Non-Extending Lender by causing such Lender to (and such Lender shall be obligated to) assign pursuant to Section 10.04 (with the assignment fee, if any, and any other costs and expenses to be paid by the Borrower in such instance) all of its rights and obligations
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under this Agreement to one or more assignees; provided that neither the Administrative Agent nor any Lender shall have any obligation to the Borrower to obtain a replacement Lender; provided, further, that the applicable assignee shall have agreed to provide Loans and/or a commitment on the terms set forth in such Extension Amendment; and provided, further, that all Obligations (other than contingent indemnity obligations, unasserted expense reimbursement obligations, and Letters of Credit that have been (i) cash collateralized in accordance with the terms of this Agreement, (ii) backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or (iii) rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank) of the Borrower owing to the Non-Extending Lender relating to the Loans and participations so assigned shall be paid in full at par to such Non-Extending Lender concurrently with such Assignment and Assumption by the assignee Lender (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts) or (B) prepay the Loans and all other Obligations owing to and, at the Borrowers option, if applicable, terminate the Commitments of, such Non-Extending Lender, in whole or in part, subject to breakage costs, without premium or penalty. In connection with any such replacement under this Section 2.21, if the Non-Extending Lender does not execute and deliver to the Administrative Agent a duly completed Assignment and Assumption and/or any other documentation necessary to reflect such replacement by the later of (a) the date on which the replacement Lender executes and delivers such Assignment and Assumption and/or such other documentation and (b) the date as of which all Obligations (other than contingent indemnity obligations, unasserted expense reimbursement obligations, and Letters of Credit that have been (i) cash collateralized in accordance with the terms of this Agreement, (ii) backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or (iii) rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank) of the Borrower owing to the Non-Extending Lender relating to the Loans and participations so assigned shall be paid in full in cash to such Non-Extending Lender by the assignee Lender (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts), then such Non-Extending Lender shall be deemed to have executed and delivered such Assignment and Assumption and/or such other documentation as of such date and the Borrower shall be entitled (but not obligated) to execute and deliver such Assignment and Assumption and/or such other documentation on behalf of such Non-Extending Lender. This Section 2.21(e) shall supersede any provisions in Section 10.02 to the contrary.
Section 2.22 Refinancing Facilities.
(a) At any time after the Closing Date, the Borrower may obtain, from any Lender or any Additional Lender (to the extent agreed to by such Lender or Additional Lender in its sole discretion), Credit Agreement Refinancing Indebtedness in respect of all or any portion of the Term Loans or Revolving Loans then outstanding under this Agreement (which will be deemed to include any then outstanding Incremental Term Loans under any Incremental Term Loan Commitments or any Incremental Revolving Loan Commitments then outstanding under this Agreement) or any then outstanding Refinancing Term Loans in the form of Refinancing Term Loans or Refinancing Term Commitments or any then outstanding Refinancing Revolving Loans in the form of Refinancing Revolving Loans or Refinancing Revolving Loan Commitments, in each case, pursuant to a Refinancing Amendment, together with any applicable Intercreditor Agreement or other customary subordination agreement; provided that such Credit
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Agreement Refinancing Indebtedness (i) will, to the extent secured, rank pari passu or junior in right of payment and of security with the other Loans and Commitments hereunder (but for the avoidance of doubt, such Credit Agreement Refinancing Indebtedness may be unsecured), (ii) will, to the extent permitted by the definition of Credit Agreement Refinancing Indebtedness, have such pricing, interest rate margins, rate floors, discounts, fees, premiums and prepayment or redemption provisions and terms as may be agreed by the Borrower and the Lenders or Additional Lenders with respect thereto and (iii) will, to the extent in the form of Refinancing Revolving Loans or Refinancing Revolving Loan Commitments, participate in the payment, borrowing, participation and commitment reduction provisions herein on a pro rata basis with any then outstanding Revolving Loans and Revolving Commitments, except that the Borrower shall be permitted to permanently repay and terminate commitments of any such Class on a better than a pro rata basis as compared to any other Class with a later maturity date than such Class. The effectiveness of any Refinancing Amendment shall be subject to, to the extent reasonably requested by the Administrative Agent, receipt by the Administrative Agent of board resolutions, officers certificates and/or reaffirmation agreements consistent with those delivered on the Closing Date. The Administrative Agent shall promptly notify each Lender as to the effectiveness of each Refinancing Amendment. Each of the parties hereto hereby agrees that, upon the effectiveness of any Refinancing Amendment, this Agreement shall be deemed amended to the extent (but only to the extent) necessary to reflect the existence and terms of the Credit Agreement Refinancing Indebtedness incurred pursuant thereto (including any amendments necessary to treat the Loans and Commitments subject thereto as Refinancing Term Loans, Refinancing Revolving Loans, Refinancing Term Loan Commitments or Refinancing Revolving Loan Commitments, as applicable) and any Indebtedness being replaced or refinanced with such Credit Agreement Refinancing Indebtedness shall be deemed permanently reduced and satisfied in all respects. Any Refinancing Amendment may, without the consent of any other Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, to effect the provisions of this Section.
(b) This Section 2.22 shall supersede any provisions in Section 10.02 to the contrary.
Section 2.23 Permitted Debt Exchanges.
(a) Notwithstanding anything to the contrary contained in this Agreement, pursuant to one or more offers (each, a Permitted Debt Exchange Offer) made from time to time by the Borrower to all Lenders (other than, with respect to any Permitted Debt Exchange Offer that constitutes an offering of securities, any Lender that, if requested by the Borrower, is unable to certify that it is (i) a qualified institutional buyer (as defined in Rule 144A under the Securities Act), (ii) an institutional accredited investor (as defined in Rule 501 under the Securities Act) or (iii) not a U.S. person (as defined in Rule 902 under the Securities Act)) with outstanding Term Loans of a particular Class, the Borrower may from time to time consummate one or more exchanges of such Term Loans for Indebtedness (in the form of senior secured, senior unsecured, senior subordinated, or subordinated notes or loans) (such Indebtedness, Permitted Debt Exchange Notes and each such exchange, a Permitted Debt Exchange), so long as the following conditions are satisfied:
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(i) each such Permitted Debt Exchange Offer shall be made on a pro rata basis to the applicable Term Loan Lenders (other than, with respect to any Permitted Debt Exchange Offer that constitutes an offering of securities, any Lender that, if requested by the Borrower, is unable to certify that it is (i) a qualified institutional buyer (as defined in Rule 144A under the Securities Act), (ii) an institutional accredited investor (as defined in Rule 501 under the Securities Act) or (iii) not a U.S. person (as defined in Rule 902 under the Securities Act)) of each applicable Class based on their respective aggregate principal amounts of outstanding Term Loans under such Class;
(ii) the aggregate principal amount (calculated on the face amount thereof) of such Permitted Debt Exchange Notes shall not exceed the aggregate principal amount (calculated on the face amount thereof) of Term Loans so refinanced, except by an amount equal to any accrued and unpaid interest thereon, and any fees, expenses, commissions, underwriting discounts and premiums payable in connection with such Permitted Debt Exchange;
(iii) (x) the sole borrower in respect of such Indebtedness shall be the Borrower and (y) no Person shall be a guarantor with respect to such Indebtedness unless such Person is a Guarantor which shall have previously or substantially concurrently Guaranteed the Obligations;
(iv) (x) other terms and conditions of such Permitted Debt Exchange Notes otherwise comply with the Required Debt Terms and (y) the Permitted Debt Exchange Notes shall not have a higher Lien priority than the facility that is being refinanced by the issuance of any such Permitted Debt Exchange Notes;
(v) [reserved];
(vi) subject to Section 1,06, no Default or Event of Default shall have occurred and be continuing at the time of funding or immediately after giving effect to such Permitted Debt Exchange;
(vii) the aggregate principal amount (calculated on the face amount thereof) of all Term Loans exchanged under each applicable Class by the Borrower pursuant to any Permitted Debt Exchange shall automatically be cancelled and retired by the Borrower on date of the settlement thereof (and, if requested by the Administrative Agent, any applicable exchanging Lender shall execute and deliver to the Administrative Agent an Assignment and Assumption, or such other form as may be reasonably requested by the Administrative Agent, in respect thereof pursuant to which the respective Lender assigns its interest in the Term Loans being exchanged pursuant to the Permitted Debt Exchange to the Borrower for immediate cancellation), and accrued and unpaid interest on such Term Loans shall be paid to the exchanging Lenders on the date of consummation of such Permitted Debt Exchange, or, if agreed to by the Borrower and the Administrative Agent, the next scheduled Interest Payment Date with respect to such Term Loans (with such interest accruing until the date of consummation of such Permitted Debt Exchange);
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(viii) if the aggregate principal amount of all Term Loans (calculated on the face amount thereof) of a given Class tendered by Lenders in respect of the relevant Permitted Debt Exchange Offer (with no Lender being permitted to tender a principal amount of Term Loans which exceeds the principal amount of the applicable Class actually held by it) shall exceed the maximum aggregate principal amount of Term Loans of such Class offered to be exchanged by the Borrower pursuant to such Permitted Debt Exchange Offer, then the Borrower shall exchange Term Loans under the relevant Class tendered by such Lenders ratably up to such maximum based on the respective principal amounts so tendered, or, if such Permitted Debt Exchange Offer shall have been made with respect to multiple Classes without specifying a maximum aggregate principal amount offered to be exchanged for each Class, and the aggregate principal amount of all Term Loans (calculated on the face amount thereof) of all Classes tendered by Lenders in respect of the relevant Permitted Debt Exchange Offer (with no Lender being permitted to tender a principal amount of Term Loans which exceeds the principal amount thereof actually held by it) shall exceed the maximum aggregate principal amount of Term Loans of all relevant Classes offered to be exchanged by the Borrower pursuant to such Permitted Debt Exchange Offer, then the Borrower shall exchange Term Loans across all Classes subject to such Permitted Debt Exchange Offer tendered by such Lenders ratably up to such maximum amount based on the respective principal amounts so tendered;
(ix) all documentation in respect of such Permitted Debt Exchange shall be consistent with the foregoing and reasonably acceptable to the Administrative Agent and the Borrower, and all written communications generally directed to the Lenders in connection therewith shall be in form and substance consistent with the foregoing and made in consultation with the Borrower and the Administrative Agent;
(x) any applicable Minimum Tender Condition or Maximum Tender Condition, as the case may be, shall be satisfied or waived by the Borrower; and
(xi) notwithstanding anything to the contrary herein, no Lender shall have any obligation to agree to have any of its Loans or Commitments exchanged pursuant to any Permitted Debt Exchange Offer.
(b) With respect to all Permitted Debt Exchanges effected by the Borrower pursuant to this Section 2.23, such Permitted Debt Exchange Offer shall be made for not less than $5,000,000 in aggregate principal amount of Term Loans; provided that subject to the foregoing the Borrower may at its election specify (A) as a condition (a Minimum Tender Condition) to consummating any such Permitted Debt Exchange that a minimum amount (to be determined and specified in the relevant Permitted Debt Exchange Offer in the Borrowers discretion) of Term Loans of any or all applicable Classes be tendered and/or (B) as a condition (a Maximum Tender Condition) to consummating any such Permitted Debt Exchange that no more than a maximum amount (to be determined and specified in the relevant Permitted Debt Exchange Offer in the Borrowers discretion) of Term Loans of any or all applicable Classes will be accepted for exchange. The Administrative Agent and the Lenders hereby acknowledge and agree that the provisions of Section 2.07 and Section 2.10 do not apply to the Permitted Debt Exchange and the other transactions contemplated by this Section 2.23 and hereby agree not to assert any Default or Event of Default in connection with the implementation of any such Permitted Debt Exchange or any other transaction contemplated by this Section 2.23.
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(c) In connection with each Permitted Debt Exchange, the Borrower shall provide the Administrative Agent at least five Business Days (or such shorter period as may be agreed by the Administrative Agent) prior written notice thereof, and the Borrower and the Administrative Agent, acting reasonably, shall mutually agree to such procedures as may be necessary or advisable to accomplish the purposes of this Section 2.23; provided that the terms of any Permitted Debt Exchange Offer shall provide that the date by which the relevant Lenders are required to indicate their election to participate in such Permitted Debt Exchange shall be not less than five Business Days following the date on which the Permitted Debt Exchange Offer is made. The Borrower shall provide the final results of such Permitted Debt Exchange to the Administrative Agent no later than three Business Days prior to the proposed date of effectiveness for such Permitted Debt Exchange (or such shorter period agreed to by the Administrative Agent in its sole discretion), and the Administrative Agent shall be entitled to conclusively rely on such results.
(d) The Borrower shall be responsible for compliance with, and hereby agrees to comply with, all applicable securities and other laws in connection with each Permitted Debt Exchange, it being understood and agreed that (i) neither the Administrative Agent nor any Lender assumes any responsibility in connection with the Borrowers compliance with such laws in connection with any Permitted Debt Exchange and (ii) each Lender shall be solely responsible for its compliance with any applicable insider trading laws and regulations to which such Lender may be subject under the Exchange Act.
Section 2.24 Designation of Borrowers.
(a) The Borrower may from time to time designate one or more Additional Borrowers organized in a jurisdiction within the U.S. for purposes of this Agreement by delivering to the Administrative Agent:
(i) written notice (including via email) of election to become an Additional Borrower (an Election to Participate) duly executed on behalf of such Restricted Subsidiary and the Borrower two Business Days prior to the proposed effectiveness of such election,
(ii) all documentation and other information with respect to such Subsidiary required by regulatory authorities under applicable know your customer and anti-money laundering rules and regulations, including without limitation the Patriot Act, no later than two Business Days prior to the date of such notice (or such later date as may be agreed by the Administrative Agent);
(iii) (A) all documents, updated schedules, instruments, certificates and agreements, and all other actions and information, then required by or in respect of such Additional Borrower by Section 5.10 or by the Security Agreement (without giving effect to any grace periods for delivery of such items, the updating of such information or the taking of such actions), (B) a legal opinion of counsel to the Additional Borrower relating
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to such Additional Borrower, in form and substance consistent with that delivered in respect of the initial Borrower on the Closing Date (provided that such legal opinion may be modified in form or substance in a manner satisfactory to the Administrative Agent in its sole discretion), and (C) a customary secretarys certificate attaching such documents as were delivered by the original Borrower on the Closing Date;
(iv) documentation reasonably satisfactory to the Administrative Agent pursuant to which (i) each then-existing Borrower unconditionally Guarantees the Borrowings of the Additional Borrower on terms substantially consistent with the Guarantors Guarantee of the initial Borrowers obligations hereunder and (ii) each Additional Borrower unconditionally Guarantees the Borrowings of each then-existing Borrower on terms substantially consistent with the Guarantors Guarantee of the initial Borrowers obligations hereunder;
(v) a certificate of a Responsible Officer of the Borrower stating that, as of the date the Additional Borrower joins this Agreement as such, no Default or Event of Default has occurred and is continuing;
(vi) promissory notes in respect of such Additional Borrower in favor of any Lender requesting such promissory notes, in form and substance consistent with the Notes set forth in Exhibit H-l, Exhibit H-2 and Exhibit H-3 (modified to reflect such Additional Borrower); and
(vii) a customary joinder agreement whereby the Additional Borrower becomes party hereto as a Borrower and appoints the Borrower as a Borrower Agent hereunder and under the other Loan Documents, in form and substance reasonably satisfactory to the Administrative Agent.
(b) After such deliveries, the appointment of the Additional Borrower shall be effective upon the effectiveness of an amendment to this Agreement and any applicable Loan Document necessary (in the reasonable judgment of the Administrative Agent) to give effect to the appointment of such Additional Borrower (in form and substance reasonably acceptable to the Administrative Agent), including amendments to disambiguate certain uses of the word Borrower and related terms hereunder; provided, that, for the avoidance of doubt, the Administrative Agent shall not have any right to consent to the designation of any Additional Borrower and shall not be required to approve the addition of such Additional Borrower to the extent the requirements of Section 2.24(a) have been met.
Section 2.25 AHYDO Prepayment. Notwithstanding the provisions of this Article II or any other provision in any Loan Document, if at the end of any accrual period (as defined in Section 1272(a)(5) of the Code) ending after the fifth anniversary of the initial issuance of a Loan, the aggregate amount of accrued and unpaid interest and original issue discount (as defined in Code Section 1273(a)(1)) on such Loan would, but for this paragraph, exceed an amount equal to the product of such Loans issue price (as defined in Code Sections 1273(b) and 1274(a)) multiplied by the yield to maturity (as defined in Treasury Regulation Section 1.1272-l(b)(l)(i)) (the Maximum Accrual), all accrued and unpaid interest and original issue discount on such Loan as of the end of such accrual period in excess of the Maximum Accrual shall be prepaid by the Borrower. The immediately preceding sentence shall be interpreted in accordance with the provisions of Code Section 163 so that none of the Loans is an applicable high yield discount obligation.
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Section 2.26 Illegality. If any Lender determines that any Requirement of Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or its lending office to perform any of its obligations hereunder or make, maintain or fund or charge interest with respect to any Credit Extension or to determine or charge interest rates based upon the LIBO Rate, or any Governmental Authority has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the London interbank market, then, on notice thereof by such Lender to the Borrower through the Administrative Agent, (i) any obligation of such Lender to issue, make, maintain, fund or charge interest with respect to any such Credit Extension or continue Eurodollar Loans or convert ABR Loans to Eurodollar Loans shall be suspended, and (ii) if such notice asserts the illegality of such Lender making or maintaining ABR Loans the interest rate on which is determined by reference to the Adjusted LIBO Rate component of the Alternate Base Rate, the interest rate on such ABR Loans of such Lender shall, if necessary to avoid such illegality, be determined by the Administrative Agent without reference to the Adjusted LIBO Rate component of the Alternate Base Rate, in each case until such Lender notifies the Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, (x) the Borrower shall, upon demand from such Lender (with a copy to the Administrative Agent), prepay or, if applicable, convert all Eurodollar Loans of such Lender to ABR Loans (the interest rate on which ABR Loans of such Lender shall, if necessary to avoid such illegality, be determined by the Administrative Agent without reference to the Adjusted LIBO Rate component of the Alternate Base Rate), either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurodollar Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such Eurodollar Loans and (y) if such notice asserts the illegality of such Lender determining or charging interest rates based upon the LIBO Rate, the Administrative Agent shall during the period of such suspension compute the Alternate Base Rate applicable to such Lender without reference to the Adjusted LIBO Rate component thereof until the Administrative Agent is advised in writing by such Lender that it is no longer illegal for such Lender to determine or charge interest rates based upon the LIBO Rate. Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on the amount so prepaid or converted.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Each Credit Party represents and warrants to the Administrative Agent, the Collateral Agent, the Issuing Bank and each of the Lenders on the Closing Date and on each other date set forth in Section 4,02 (in the case of such other date, to the extent set forth in Section 4,02) that (it being understood that for purposes of this Article III, Credit Parties and Group Member shall exclude Holdings for purposes of Section 3.11):
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Section 3.01 Organization; Powers. Each Credit Party (a) is duly incorporated, organized or formed and validly existing under the laws of the jurisdiction of its incorporation or organization, (b) has all requisite power and authority to carry on its business as now conducted and to own and lease its property, in each case except where the failure to do so would not reasonably be expected to result in a Material Adverse Effect, and (c) is qualified and in good standing (to the extent such concept is applicable in the applicable jurisdiction) to do business in every jurisdiction where such qualification is required, except in such jurisdictions where the failure to so qualify or be in good standing, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.
Section 3.02 Authorization; Enforceability. The Loan Documents to be entered into by each Credit Party are within such Credit Partys powers and have been duly authorized by all necessary action on the part of such Credit Party. This Agreement has been duly executed and delivered by each Credit Party and constitutes, and each other Loan Document to which any Credit Party is to be a party, when executed and delivered by such Credit Party, will constitute, a legal, valid and binding obligation of such Credit Party, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.
Section 3.03 No Conflicts. Except as set forth on Schedule 3,03, the execution, delivery and performance by the Credit Parties of the Loan Documents to which they are a party and the Credit Extensions contemplated by the Loan Documents (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except (i) such as have been obtained or made and are in full force and effect, (ii) filings necessary to perfect Liens created by the Loan Documents and (iii) consents, approvals, registrations, filings, permits or actions the failure to obtain or perform which would not reasonably be expected to result in a Material Adverse Effect, (b) will not violate or require consent not obtained under the Organizational Documents of any Group Member, except as would not reasonably be expected to result in a Material Adverse Effect, (c) will not violate or result in a default under any indenture or other material agreement or instrument binding upon any Group Member or any of their assets, or give rise to a right thereunder to require any payment, repurchase or redemption to be made by any Group Member, or give rise to a right of, or result in, termination, cancellation or acceleration of any obligation thereunder, except, in each case, individually or in the aggregate, as would not reasonably be expected to result in a Material Adverse Effect, and (d) will not violate any Requirement of Law except, individually or in the aggregate, as would not reasonably be expected to result in a Material Adverse Effect.
Section 3.04 Financial Statements; Projections.
(a) Historical Financial Statements. On the Closing Date, the Borrower shall have delivered to the Administrative Agent and made available to the Lenders the Financial Statements. The financial statements in the immediately preceding sentence have been prepared in accordance with GAAP and present fairly in all material respects the financial condition and the results of operations and cash flows of the applicable entities to which they relate as of the dates and for the periods to which they relate. All financial statements delivered pursuant to Section 5.01(a) and Section 5.01(b) have been prepared in accordance with GAAP and present fairly in all material respects the financial condition and results of operations and cash flows of Holdings and its consolidated Restricted Subsidiaries as of the dates and for the periods to which they relate, except as indicated in any notes thereto and, in the case of any such unaudited financial statements, the absence of footnote disclosures and audit adjustments.
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(b) Absence of Material Adverse Effect. Since the Closing Date, there has been no event, change, circumstance or occurrence that, individually or in the aggregate, has had or would reasonably be expected to result in a Material Adverse Effect.
(c) Restatements. Each Lender and the Administrative Agent hereby acknowledge and agree that Holdings and its Subsidiaries may be required to restate historical financial statements as the result of the implementation of changes in GAAP, or the respective interpretation thereof, and that such restatements will not result in a Default or Event of Default under the Loan Documents.
Section 3.05 Properties. Each Group Member (i) has good title to, or valid leasehold interests in, all of its Property (other than Intellectual Property, which is subject to Section 3.06 and not this Section 3.05) material to its business, except to the extent of any irregularities or deficiencies that would not be reasonably expected to result in a Material Adverse Effect, and (ii) owns its Collateral and any Material Property, if any, in each case, free and clear of all Liens except for Permitted Liens and any Liens and privileges arising mandatorily by Law, and in each case, except where the failure to have such title or other interest could not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
Section 3.06 Intellectual Property. Each Credit Party owns, or is licensed (or authorized) to use, all Intellectual Property material to the conduct of its business as currently conducted. To the knowledge of each Credit Party, the operation of such Credit Partys business and the use of Intellectual Property owned by such Credit Party or licensed by such Credit Party do not infringe, misappropriate, dilute or otherwise violate the Intellectual Property rights of any person, except to the extent such violations, either individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect. No claim or litigation regarding any Intellectual Property owned by a Credit Party is pending or, to the knowledge of any Credit Party, threatened in writing against any Credit Party or Subsidiary, which, either individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect. The Borrower has taken (and caused its Subsidiaries to take) all commercially reasonable steps to maintain, enforce and protect the material owned Intellectual Property of the Credit Parties and maintain the Credit Parties rights in any material licensed Intellectual Property.
Section 3.07 Equity Interests and Restricted Subsidiaries. As of the Closing Date, neither the Borrower nor any other Credit Party has any Subsidiaries other than those specifically disclosed on Schedule 3,07, and all of the outstanding Equity Interests in the Borrower and its Subsidiaries have been validly issued, are fully paid and nonassessable (other than Equity Interests consisting of limited liability company interests or partnership interests which, pursuant to the relevant organizational or formation documents, cannot be fully paid and nonassessable) and, on the Closing Date, all Equity Interests owned directly or indirectly by Holdings or any other Credit Party are owned free and clear of all Liens except (i) those created under the Security Documents, and (ii) those Liens permitted under Section 6.02. As of the Closing Date, Schedule 3,07 sets forth (a) the name and jurisdiction of organization or incorporation of each Subsidiary, (b) the ownership interest of Holdings, the Borrower and any of their respective Subsidiaries in each of their respective Subsidiaries, including the percentage of such ownership by class (if applicable) and (c) all outstanding options, warrants, rights of conversion or purchase and similar rights with respect to the equity of the Borrower or its Subsidiaries.
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Section 3.08 Litigation. Except as set forth on Schedule 3,08, there are no actions, suits or proceedings at law or in equity by or before any Governmental Authority now pending or, to the knowledge of the Borrower, threatened in writing against or contemplated, at law, in equity, in arbitration or before any Governmental Authority, by or against Holdings, the Borrower or any Restricted Subsidiary or against any of their properties or revenues that either individually or in the aggregate, could reasonably be expected, if adversely determined, to have a Material Adverse Effect.
Section 3.09 Federal Reserve Regulations. No Credit Party is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of buying or carrying Margin Stock. No part of the proceeds of any Loan or any Letter of Credit will be used for any purpose that violates Regulation U or Regulation X.
Section 3.10 Investment Company Act. No Credit Party is an investment company under the Investment Company Act of 1940, as amended.
Section 3.11 Use of Proceeds. The Borrower will (or will direct a Credit Party to) use the proceeds of the Term Loans on the Closing Date to finance (i) the Closing Date Refinancing, (ii) the other Transactions, (iii) the payment of related fees, costs and expenses (including any upfront fees and original issue discount) related to the foregoing transactions, and (iv) working capital and general corporate purposes. The Borrower will (or will direct a Credit Party to) use the proceeds of the Revolving Loans and Swing Line Loans on or after the Closing Date for working capital and general corporate purposes (including to effect Permitted Acquisitions, Investments, working capital and/or purchase price adjustments, Capital Expenditures, Dividends, prepayments of, and other payments with respect to, Indebtedness (including, without limitation Restricted Debt Payments), any other transaction not prohibited under this Agreement, and, in each case, any related fees and expenses). Proceeds of the Incremental Facilities may be used for working capital and general corporate purposes, including, without limitation, to finance Permitted Acquisitions and other Investments (including refinancing the existing Indebtedness of acquired businesses), Capital Expenditures, for working capital and/or purchase price adjustments, Dividends and prepayments of, and other payments with respect to, Indebtedness (including, without limitation, Restricted Debt Payments) permitted hereunder, for any other purposes not prohibited by this Agreement, and to pay related fees, costs and expenses in connection with any such transactions.
Section 3.12 Taxes. Each Group Member has (a) timely filed or caused to be timely filed all federal Tax Returns and all material state, local and foreign Tax Returns required to have been filed by it, and (b) duly and timely paid or remitted or caused to be duly and timely paid or remitted all Taxes due and payable or remittable by it and all assessments received by it, except (i) Taxes that are being contested in good faith by appropriate proceedings and for which such Group Member has set aside on its books adequate reserves in accordance with GAAP, or
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(i) Taxes which would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect. Each Group Member is unaware of any proposed or pending Tax assessments, deficiencies or audits that would be reasonably expected to, individually or in the aggregate, result in a Material Adverse Effect.
Section 3.13 No Material Misstatements.
(a) No written information, report, financial statement, certificate, Borrowing Request, LC Request, exhibit or schedule (in each case other than forecasts, projections and other forward looking statements (collectively, Projections) and information of a general economic or industry nature) furnished by or on behalf of any Group Member to the Administrative Agent or any Lender in connection with any Loan Document or included therein or delivered pursuant thereto, taken as a whole and when furnished, contained or contains any material misstatement of fact or omitted or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were or are made, not materially misleading when taken as a whole as of the date such information, report, financial statement, certificate, Borrowing Request, LC Request, exhibit or schedule is dated or certified.
(b) With respect to any Projections delivered pursuant to the terms hereof, each Group Member represents only that on the date of delivery thereof it acted in good faith and utilized assumptions believed by it to be reasonable when made in light of the then current circumstances (it being understood that Projections are predictions as to future events and are not to be viewed as facts and are subject to significant uncertainties and contingencies, which are beyond the control of Holdings and its Restricted Subsidiaries, and that no assurance or guarantee can be given that any Projections will be realized, that actual results may differ and such differences may be material).
Section 3.14 Labor Matters. (i) There are no strikes, lockouts, or slowdowns against any Group Member pending or, to the knowledge of any Credit Party, threatened in writing, and (ii) the consummation of the Transactions will not give rise to any right of termination or right of renegotiation on the part of any union under any collective bargaining agreement to which any Group Member is bound, other than to the extent that any of the foregoing matters in preceding clauses (i) and (ii), individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.
Section 3.15 Solvency. On the Closing Date and after giving effect to the Transactions, Holdings and its Subsidiaries, on a consolidated basis, (a) have property with a fair value greater than the total amount of their debts and liabilities, contingent, subordinated or otherwise, (b) have assets with present fair saleable value not less than the amount that will be required to pay their liability on their debts as they become absolute and matured, (c) will be able generally to pay their debts and liabilities, subordinated, contingent and otherwise, as they become absolute and matured and (d) are not engaged in business or transactions, and are not about to engage in business or transactions, for which their property would constitute an unreasonably small amount of capital. For the purposes hereof, the amount of any contingent liability at any time shall be computed as the amount that, in light of all of the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.
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Section 3.16 Employee Benefit Plans.
With respect to each Employee Benefit Plan, each Group Member is in compliance in all respects with the applicable provisions of ERISA and the Code and the regulations and published interpretations thereunder, except as would not reasonably be expected to result in a Material Adverse Effect. No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other ERISA Events, would reasonably be expected to result in a Material Adverse Effect or the imposition of a Lien on any of the property of any Group Member. The present value of all accumulated benefit obligations of all underfunded Plans (based on the assumptions used for financial reporting purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of the most recent financial statements reflecting such amounts, exceed the fair market value of the property of all such underfunded Plans by an amount that would reasonably be expected to result in a Material Adverse Effect. Using actuarial assumptions and computation methods consistent with Section 4211 of ERISA, the aggregate liabilities of each Group Member or its ERISA Affiliates to all Multiemployer Plans in the event of a complete withdrawal therefrom, as of the close of the most recent fiscal year of each such Multiemployer Plan, would not reasonably be expected to result in a Material Adverse Effect. As of the date hereof, no Group Member has been notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is insolvent (within the meaning of Section 4245 of ERISA), and no such Multiemployer Plan is reasonably expected by any Group Member to be insolvent, except, in each case, as would not reasonably be expected to result in a Material Adverse Effect.
Except as would not reasonably be expected to result in a Material Adverse Effect, (i) each Foreign Plan has been maintained in compliance with its terms and with the requirements of any and all applicable Requirements of Law and has been maintained, where required, in good standing with applicable regulatory authorities and (ii) no Group Member has incurred any obligation in connection with the termination of or withdrawal from any Foreign Plan. The present value of the accrued benefit liabilities (whether or not vested) under each Foreign Plan which is funded, determined as of the end of the most recently ended fiscal year of the respective Group Member on the basis of actuarial assumptions, each of which is reasonable, did not exceed the current value of the property of such Foreign Plan by an amount that would reasonably be expected to result in a Material Adverse Effect, and for each Foreign Plan which is not funded, the obligations of such Foreign Plan are properly accrued in accordance with GAAP in all material respects.
Section 3.17 Environmental Matters.
(a) Except as, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect:
(i) The Group Members and their businesses, operations and Real Property are in compliance with all Environmental Laws;
(ii) The Group Members have obtained all Environmental Permits required for the conduct of their businesses and operations, and the ownership, operation and use of their Real Property;
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(iii) There has been no Release or threatened Release of Hazardous Material caused by the Group Members, or to the knowledge of the Group Members by any other person, on, at, under or from any Real Property presently, or to the knowledge of the Group Members, formerly owned, leased or operated by the Group Members;
(iv) There is no Environmental Claim pending or, to the knowledge of the Group Members, threatened against the Group Members; and
(v) No Lien has been recorded, or to the knowledge of any Group Member, threatened under any Environmental Law with respect to any Real Property currently owned, operated or leased by the Group Members.
(b) This Section 3.17 contains the sole and exclusive representations and warranties of the Group Members with respect to any matters arising under Environmental Laws or relating to Environmental Claims or Hazardous Materials.
Section 3.18 Security Documents. Subject to Section 4,01(1), each Security Document delivered pursuant to Article IV, Section 5.10, and Section 5.11 will, upon execution and delivery thereof, be effective to create in favor of the Collateral Agent, for its benefit and the benefit of the Secured Parties, legal, valid and enforceable Liens on, and security interests in, all of the Credit Parties right, title and interest in and to the Collateral thereunder under applicable U.S. state and federal law, except as such enforceability may be limited by Debtor Relief Laws and by general principles of equity and capital maintenance rules and (i) when appropriate filings or recordings are made in the appropriate offices as may be required under applicable Requirements of Law (to the extent required hereunder and thereunder), and (ii) upon the taking of possession, control or other action by the Collateral Agent of such Collateral with respect to which a security interest may be perfected only by possession, control or other action (which possession, control or other action shall be given to the Collateral Agent or taken by the Collateral Agent to the extent required by any Security Document), the Liens in favor of Collateral Agent will, to the extent required by the Loan Documents (including the Security Documents) constitute fully perfected Liens on, and security interests in, all right, title and interest of the Credit Parties in such Collateral, in each case under applicable U.S. state and federal law, subject to no Liens other than the applicable Permitted Liens.
Section 3.19 Anti-Terrorism Law. No Credit Party is in material violation of any applicable Requirement of Law relating to terrorism or money laundering (Anti-Terrorism Laws), including Executive Order No. 13224, effective September 24, 2001 (the Executive Order), and the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56, signed into law October 26, 2001 (the Patriot Act). The use of proceeds of the Loans will not violate the Trading With the Enemy Act (50 U.S.C. §§ 1-44, as amended) or any applicable foreign asset control regulations of the United States Treasury Department (31 C.F.R. Subtitle B, Chapter V).
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Section 3.20 OFAC. None of Holdings, the Borrower, any Subsidiary nor, to the knowledge of the Borrower, any director, officer, employee, or agent of Holdings, the Borrower or any Restricted Subsidiary is the subject or target of any U.S. sanctions administered by OF AC or the U.S. Department of State or any similar laws or regulations enacted by Canada, the European Union or the United Kingdom (collectively, Sanctions). The Borrower shall not use the proceeds of the Loans or Letters of Credit, directly or, to the Borrowers knowledge, indirectly, or otherwise would make available such proceeds to any Person, for the purpose of financing activities of or with any Person that is the subject or target of any applicable Sanctions, or in any country that, at the time of such financing is, or whose government is, the subject or target of any Sanctions, in each case, except to the extent licensed by OF AC or otherwise authorized under U.S. law, or in any other manner that would result in a violation of applicable Sanctions by any Person.
Section 3.21 Foreign Corrupt Practices Act. No part of the proceeds of the Loans will be used directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or any other Person acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended.
Section 3.22 Compliance with Law. Each of Holdings, the Borrower and each Restricted Subsidiary is in compliance with all Requirements of Law and all orders, writs, injunctions and decrees applicable to it or to its properties, except in such instances in which (a) such Requirements of Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings or (b) the failure to comply therewith, either individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.
ARTICLE IV
CONDITIONS
Section 4.01 Conditions to Initial Credit Extension. The obligation of each Lender and, if applicable, the Issuing Bank, to fund the initial Credit Extensions on the Closing Date requested to be made by the Borrower shall be subject to the prior or concurrent satisfaction or waiver (by the Lead Arrangers) of only the conditions precedent set forth in this Section 4,01 (the making of such initial Credit Extensions by a Lender being conclusively deemed to be its satisfaction or waiver of the conditions precedent):
(a) Loan Documents. There shall have been delivered to the Administrative Agent from Holdings, the Borrower and each other Credit Party an executed counterpart of each of the Loan Documents to which each is a party to be entered into on the Closing Date.
(b) [Reserved].
(c) Corporate Documents. The Administrative Agent shall have received:
(i) a certificate of the secretary or assistant secretary (or equivalent officer) on behalf of each Credit Party dated the Closing Date, certifying (A) that attached thereto is a true and complete copy of each Organizational Document of such Credit Party and, with respect to the articles or certificate of incorporation or organization (or similar document) certified (to the extent applicable) as of a recent date by the Secretary of State (or other applicable Governmental Authority) of the state of its organization, (B) that attached thereto is a true and complete copy of resolutions duly
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adopted by the Board of Directors and/or equityholders (as applicable) of such Credit Party authorizing the execution, delivery and performance of the Loan Documents to which such person is a party and, in the case of the Borrower, the Borrowings hereunder, and that such resolutions have not been modified, rescinded or amended and are in full force and effect as of the date of such certificate, and (C) as to the incumbency and specimen signature of each officer or authorized person executing any Loan Document or any other document delivered in connection herewith on behalf of such Credit Party (together with a certificate of another officer or authorized person as to the incumbency and specimen signature of the officer or authorized person executing the certificate in this clause (i));
(ii) to the extent available, a certificate as to the good standing of each Credit Party as of a recent date, from such Secretary of State (or other applicable Governmental Authority) of its jurisdiction of organization; and
(iii) the Administrative Agent shall have received a certificate dated the Closing Date and signed by a Responsible Officer of Holdings, confirming compliance with the conditions precedent set forth in Sections 4.01(g) and 4.02(c).
(d) Closing Date Refinancing and Other Transactions. The Closing Date Refinancing shall have occurred, and all security and guarantees in respect of the Second Lien Credit Agreement shall be released and discharged, concurrently with the initial Credit Extension.
(e) Opinion of Counsel. The Administrative Agent shall have received, on behalf of itself, the Collateral Agent and the Lenders, a customary opinion of Kirkland & Ellis LLP, special counsel for the Credit Parties, dated as of the Closing Date and addressed to the Agents, the Issuing Bank and the Lenders (including the Swing Line Lender).
(f) Solvency Certificate. The Administrative Agent shall have received a solvency certificate in the form of Exhibit L dated the Closing Date and signed by the chief financial officer (or other officer with reasonably equivalent duties) of Holdings.
(g) No Material Adverse Effect. Since December 31, 2016, no Material Adverse Effect shall have occurred and be continuing.
(h) Fees. The Lead Arrangers, the Lenders and the Administrative Agent shall have received all fees and other amounts due and payable to them by the Borrower on or prior to the Closing Date, including, to the extent invoiced, reimbursement or payment of all reasonable and documented out-of-pocket fees and expenses (including the legal fees and expenses of Latham & Watkins LLP, special counsel to the Agents) required to be reimbursed or paid by the Borrower under this Agreement; provided that, in the case of fees, costs and expenses, an invoice for all such fees, costs and expenses shall be received by the Borrower at least three Business Days prior to the Closing Date for payment to be required as a condition to the Closing Date.
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(i) Patriot Act. So long as reasonably requested by the Administrative Agent or a Lead Arranger at least ten Business Days prior to the Closing Date, the Administrative Agent and Lead Arrangers shall have received, at least two Business Days prior to the Closing Date, all documentation and other information with respect to the Credit Parties that is required by regulatory authorities under applicable know your customer and anti-money laundering rules and regulations, including the Patriot Act, which shall include, for the avoidance of doubt, a duly executed IRS Form W-9 or other applicable tax form.
(j) [Reserved].
(k) [Reserved].
(l) Creation and Perfection of Security Interests. Notwithstanding anything to the contrary in this Section 4,01, with respect to the Secured Obligations, all actions necessary to establish that the Collateral Agent will have a perfected first priority security interest (subject to Permitted Liens) in the Collateral under the Loan Documents shall have been taken, in each case, to the extent such Collateral (including the creation or perfection of any security interest) is required to be provided on the Closing Date.
(m) Notice. The Administrative Agent shall have received a Borrowing Request as required by Section 2.03 for any Loans to be made on the Closing Date or, in the case of the issuance of a Letter of Credit on the Closing Date, the Issuing Bank and the Administrative Agent shall have received an LC Request as required by Section 2.18(b) or, in the case of the Borrowing of a Swing Line Loan made on the Closing Date, the Swing Line Lender and the Administrative Agent shall have received a Borrowing Request as required by Section 2.17(b).
(n) Financial Statements. The Administrative Agent and the Lead Arrangers shall have received the Financial Statements.
In determining the satisfaction of the conditions specified in this Section 4,01, (y) to the extent any item is required to be satisfactory to any Lender, such item shall be deemed satisfactory to each Lender which has not notified the Administrative Agent in writing prior to the occurrence of the Closing Date that the respective item or matter does not meet its satisfaction and (z) in determining whether any Lender is aware of any fact, condition or event that has occurred and which would reasonably be expected to have a Material Adverse Effect, each Lender which has not notified the Administrative Agent in writing prior to the occurrence of the Closing Date of such fact, condition or event shall be deemed not to be aware of any such fact, condition or event on the Closing Date. Upon the Administrative Agents good faith determination that the conditions specified in this Section 4,01 have been met (after giving effect to the preceding sentence), then the Closing Date shall have been deemed to have occurred, regardless of any subsequent determination that one or more of the conditions thereto had not been met.
Without limiting the generality of Section 9,03(a)(iii), for purposes of determining compliance with the conditions specified in this Section 4,01, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required hereunder or thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received written notice from such Lender prior to the proposed Closing Date specifying its objection thereto.
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Section 4.02 Conditions to All Credit Extensions. The obligation of each Lender and each Issuing Bank to make any Credit Extension (including the Credit Extensions on the Closing Date) with respect to any Term Loan or Revolving Loan under Section 2.03, Swing Line Loan under Section 2.17 or Letter of Credit under Section 2.18 shall be subject to the satisfaction, or waiver, of each of the conditions precedent set forth below.
(a) Notice. The Administrative Agent shall have received a Borrowing Request as required by Section 2.03 (or such notice shall have been deemed given in accordance with Section 2.03) if Loans are being requested or, in the case of the issuance, extension or renewal of a Letter of Credit, the Issuing Bank and the Administrative Agent shall have received an LC Request as required by Section 2.18(b) or, in the case of the Borrowing of a Swing Line Loan, the Swing Line Lender and the Administrative Agent shall have received a Borrowing Request as required by Section 2.17(b).
(b) No Default. At the time of and immediately after giving effect to such Credit Extension, no Default or Event of Default shall have occurred and be continuing on such date.
(c) Representations and Warranties. Each of the representations and warranties made by any Credit Party set forth in Article III hereof or in any other Loan Document shall be true and correct in all material respects (except that any representation and warranty that is qualified as to materiality or Material Adverse Effect shall be true and correct in all respects) on and as of the date of such Credit Extension with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date in which case such representations and warranties shall be true and correct in all material respects (except that any representation and warranty that is qualified as to materiality or Material Adverse Effect shall be true and correct in all respects) as of such earlier date.
Each of the delivery of a Borrowing Request or an LC Request and the acceptance by the Borrower of the proceeds of such Credit Extension shall constitute a representation and warranty by the Borrower and each other Credit Party that on the date of such Credit Extension (both immediately before and immediately after giving effect to such Credit Extension) the conditions contained in this Article IV have been satisfied or waived.
ARTICLE V
AFFIRMATIVE COVENANTS
The Borrower and the Subsidiary Guarantors (and Holdings with respect to Sections 5,01, 5.02, 5,03, 5,05, 5,06, 5,07, 5,10, 5,11, 5,13, and 5,14) warrant, covenant and agree with each Lender that at all times after the Closing Date, so long as this Agreement shall remain in effect and until the Commitments have been terminated and the principal of and interest on each Loan, all Fees and all other expenses or amounts payable under any Loan Document shall have been paid in full (other than contingent indemnification obligations and
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unasserted expense reimbursement obligations) and all Letters of Credit have been canceled or have expired and all amounts drawn thereunder have been reimbursed in full (except to the extent cash collateralized in accordance with the terms of this Agreement or to the extent backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank), the Borrower and the Subsidiary Guarantors (and Holdings, with respect to Sections 5,01, 5,02, 5,03, 5,05, 5,06, 5,07, 5,10, 5,11, 5,13, and 5,14) will, and will cause each of their respective Restricted Subsidiaries to:
Section 5.01 Financial Statements, Reports, etc. Furnish to the Administrative Agent for distribution to each Lender:
(a) Annual Reports. Within 120 days after the last day of each fiscal year of Holdings, a copy of the consolidated balance sheet of Holdings and its Restricted Subsidiaries as of the last day of the fiscal year then ended and the consolidated statements of income and cash flows of Holdings and its Restricted Subsidiaries for the fiscal year then ended, and accompanying notes thereto, each in reasonable detail showing (for fiscal years of Holdings ending December 31, 2017 and thereafter) in comparative form the figures for the previous fiscal year, audited and accompanied in the case of the consolidated financial statements by an opinion of (i) an independent public accounting firm of recognized national standing selected by the Borrower or (ii) any other accounting firm reasonably acceptable to the Administrative Agent (which opinion shall be unqualified as to scope, subject to the proviso below) to the effect that the consolidated financial statements have been prepared and present fairly, in all material respects, in accordance with GAAP the consolidated financial condition of Holdings and its Restricted Subsidiaries as of the close of such fiscal year; provided that such financial statements shall not contain a going concern qualification or statement, except to the extent that such a going concern qualification or statement (A) is solely a consequence of an impending stated final maturity date or (B) relates to any potential inability to satisfy the Financial Covenant or any other financial covenants under any other Indebtedness on a future date or in a future period; in each case, such financial statements shall be accompanied by a customary management discussion and analysis (in form reasonably acceptable to the Administrative Agent) of the financial performance of Holdings and its Restricted Subsidiaries;
(b) Quarterly Reports. Commencing with the first full fiscal quarter ending after the Closing Date, within 60 days after the last day of each of the first three fiscal quarters of each fiscal year of Holdings, a copy of the unaudited consolidated balance sheet of Holdings and its Restricted Subsidiaries as of the last day of such fiscal quarter and the unaudited consolidated statements of income and cash flows of Holdings and its Restricted Subsidiaries for the fiscal quarter and for the fiscal year-to-date period then ended, each in reasonable detail and showing in comparative form the figures for the corresponding date and period in the previous fiscal year of Holdings (starting with the first full fiscal quarter ending after the Closing Date), prepared by Holdings in accordance with GAAP (subject to the absence of footnote disclosures and year-end audit adjustments) and certified on behalf of Holdings by a Financial Officer as prepared in accordance with GAAP (subject to the absence of footnote disclosures and year-end audit adjustments) and fairly reflecting the financial condition and results of operations of Holdings and its Restricted Subsidiaries in all material respects;
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(c) Financial Officers Certificate. Concurrently with any delivery of financial statements under Section 5.01(a) or (b), a Compliance Certificate (i) certifying on behalf of Holdings that, to its knowledge, no Default or Event of Default has occurred and is continuing or, if any such known Default or Event of Default has occurred and is continuing, specifying the nature and extent thereof and any corrective action taken or proposed to be taken with respect thereto; provided that, if such Compliance Certificate demonstrates that an Event of Default has occurred and is continuing due to a failure to comply with any covenant under Section 6.08 that has not been cured prior to such time, the Borrower may deliver, to the extent and within the time period permitted by Section 8.03, prior to, after or together with such Compliance Certificate, a Notice of Intent to Cure such Event of Default, (ii) setting forth the computation of the First Lien Leverage Ratio (whether or not the Financial Covenant is then required to be tested) and, (iii) setting forth, in the case of each Compliance Certificate delivered concurrently with any delivery of financial statements under Section 5.01(a) above, the Borrowers calculation of Excess Cash Flow starting with the first full fiscal year after the Closing Date; provided that, for the avoidance of doubt, no Compliance Certificate shall bring down any representations and warranties made herein or in any other Loan Document;
(d) Budgets. Prior to the consummation of an IPO, commencing with the fiscal year beginning January 1, 2018, within 120 days after the beginning of each fiscal year, an annual budget (on a quarterly basis) in form customarily prepared with regard to Holdings and its Restricted Subsidiaries by Holdings; and
(e) Other Information. Promptly, from time to time, and upon the reasonable written request of the Administrative Agent, other reasonably requested information of the Group Members regarding the operations, business affairs and financial condition (including information required under the Patriot Act); provided that nothing in this Section 5.01(e) shall require any Group Member to take any action that would violate any third party customary confidentiality agreement (other than any such confidentiality agreement entered into in contemplation of this Agreement) with any Person that is not an Affiliate (and, in all events, so long as such confidentiality agreement does not relate to information regarding the financial affairs of any Group Member or the compliance with the terms of any Loan Document) or waive any attorney-client or similar privilege.
Documents required to be delivered pursuant to Section 5.01(a) through Section 5.01(e) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date on which such documents are sent via e-mail to the Administrative Agent for posting on the Borrowers behalf on IntraLinks/IntraAgency or another relevant website, if any, established on its behalf by the Administrative Agent and to which each Lender and the Administrative Agent have access or the date on which the Borrower has posted such documents on its own website to which each Lender and the Administrative Agent have access and notified the Administrative Agent of such posting. Notwithstanding anything contained herein, at the reasonable written request of the Administrative Agent, the Borrower shall thereafter promptly be required to provide paper copies of any documents required to be delivered pursuant to Section 5.01. Each Lender shall be solely responsible for timely accessing posted documents or requesting delivery of paper copies of such documents from the Administrative Agent and maintaining its copies of such documents. If the delivery of any of the foregoing documents required under this Section 5.01 shall fall on a day that is not a Business Day, such deliverable shall be due on the next succeeding Business Day.
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Section 5.02 Litigation and Other Notices. Furnish to the Administrative Agent written notice of the following promptly (and, in any event, within five Business Days or such later date as may be agreed by the Administrative Agent in its reasonable discretion) of a Responsible Officer of the Borrower obtaining actual knowledge thereof:
(a) any Default or Event of Default, specifying the nature and extent thereof and the corrective action (if any) taken or proposed to be taken with respect thereto;
(b) any litigation or governmental proceeding pending against Holdings, the Borrower or any of their Subsidiaries that could reasonably be expected to be determined adversely and, if so determined, to result in a Material Adverse Effect;
(c) the occurrence of any ERISA Event that could, when taken either alone or together with all such other ERISA Events, reasonably be expected to have a Material Adverse Effect; and
(d) any other development that has resulted in, or could reasonably be expected to result in, a Material Adverse Effect.
Section 5.03 Existence; Properties.
(a) Do or cause to be done all things necessary to preserve, renew and maintain in full force and effect its legal existence, except as otherwise permitted under Sections 6,04 or 6,05 or, in the case of any Restricted Subsidiary, where the failure to perform such obligations could not reasonably be expected to result in a Material Adverse Effect.
(b) Do or cause to be done all things reasonably necessary to obtain, preserve, renew, extend and keep in full force and effect the rights, licenses, permits, privileges, franchises, authorizations and Intellectual Property which are necessary and material to the conduct of its business (except where the failure to do so could not be reasonably expected to have a Material Adverse Effect); and comply with all applicable Requirements of Law and decrees and orders of any Governmental Authority applicable to it or to its business or property, except to the extent failure to comply therewith, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.
(c) Except to the extent that the failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, maintain, preserve and protect all of its properties and equipment material to the operation of its business in good working order, repair and condition, ordinary wear and tear excepted and casualty or condemnation excepted.
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Section 5.04 Insurance.
(a) Keep its insurable property adequately insured at all times by financially sound and reputable insurers; maintain such other insurance, in each case, to such extent and against such risks as is customary with companies in the same or similar businesses operating in the same or similar locations. Any such insurance (excluding business interruption insurance) maintained in the United States shall name the Collateral Agent as mortgagee, additional insured or loss payee, as applicable, in a manner reasonably acceptable the Collateral Agent, subject to Section 5.15.
(b) From and after ninety days after the Closing Date (or such later date as the Administrative Agent may agree), the Credit Parties shall use commercially reasonable efforts to cause all such insurance with respect to the Credit Parties and property constituting Collateral to provide that no cancellation, material reduction in amount or material change in coverage thereof shall be effective until at least 30 days after receipt by the Collateral Agent of written notice thereof (or if such cancellation is by reason of nonpayment of premium, at least ten days prior written notice) (unless it is such insurers policy not to provide such a statement).
(c) If at any time the buildings and other improvements (as described in the applicable Mortgage) on a Material Property that is encumbered by a Mortgage required by this Agreement are located in an area identified by the Federal Emergency Management Agency (or any successor agency) as a special flood hazard area with respect to which flood insurance has been made available under the National Flood Insurance Act of 1968 (as now or hereafter in effect or successor act thereto), then, solely to the extent required by applicable Requirements of Law, the Borrower shall, or shall cause the applicable Credit Party, to maintain, with a financially sound and reputable insurer, flood insurance in an amount and otherwise sufficient to comply with all applicable rules and regulations promulgated pursuant to the Flood Insurance Laws and deliver to the Administrative Agent evidence of such compliance in form and substance reasonably acceptable to the Administrative Agent.
Section 5.05 Taxes. Pay and discharge promptly when due all Taxes imposed upon it or upon its income or profits or in respect of its property, before the same shall become delinquent, or in default; provided that such payment and discharge shall not be required with respect to any such Tax so long as (x)(i) the validity or amount thereof shall be contested in good faith by appropriate proceedings and the applicable Group Member shall have set aside on its books adequate reserves or other appropriate provisions with respect thereto in accordance with GAAP and (ii) such contest operates to suspend collection of the contested Tax and enforcement of a Lien (other than a Permitted Lien) or (y) the failure to pay would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect.
Section 5.06 Employee Benefits.
(a) With respect to any Employee Benefit Plan or Foreign Plan, comply in all respects with the applicable provisions of ERISA, the Code and applicable foreign law except where the failure to do so would not reasonably be expected to result in a Material Adverse Effect; and
(b) furnish to the Administrative Agent (x) as soon as reasonably practicable after, and in any event within ten days (or such later date as may be agreed to by the Administrative Agent in its sole discretion) after any Responsible Officer of any Group Member knows that any ERISA Event or any failures to meet funding or other applicable legal
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requirements with respect to Foreign Plans has occurred that, alone or together with any other ERISA Event or such noncompliance event with respect to Foreign Plans, would reasonably be expected to result in liability of the Group Members which would reasonably be expected to have a Material Adverse Effect or the imposition of a Lien on any property of any Credit Party, a statement of a Responsible Officer of the Borrower setting forth details as to such ERISA Event or such noncompliance event with respect to Foreign Plans and the action, if any, that the Group Members propose to take with respect thereto, and (y) upon reasonable request by the Administrative Agent, copies of (i) each Schedule B (Actuarial Information) to the annual report (Form 5500 Series) filed by any Group Members with the IRS with respect to each Plan; (ii) the most recent actuarial valuation report for each Plan; (iii) all notices received by any Group Member or any ERISA Affiliate from a Multiemployer Plan sponsor or any Governmental Authority concerning an ERISA Event or such noncompliance event with respect to Foreign Plans; and (iv) such other documents or governmental reports or filings relating to any Plan or Foreign Plan, in each case, that is sponsored, maintained or contributed to by a Group Member, as the Administrative Agent shall reasonably request.
Section 5.07 Maintaining Records; Access to Properties and Inspections. Maintain a system of accounting that enables Holdings to produce financial statements in accordance with GAAP. Each Group Member will permit any representatives designated by the Administrative Agent to visit during its regular business hours and with reasonable advance written notice thereof and inspect the financial records and the property of such Group Member at reasonable times up to one time per calendar year (but without frequency limit during the continuance of an Event of Default) and to make extracts from and copies of such financial records, and permit any representatives designated by the Administrative Agent to discuss the affairs, finances, accounts and condition of any Group Member with the officers and employees thereof and advisors therefor (including independent accountants); provided that the Administrative Agent shall give any Group Member an opportunity for its representatives to participate in any such discussions; provided, further, that so long as no Event of Default has occurred and is then continuing, the Borrower shall not bear the cost of more than one such inspection per calendar year by the Administrative Agent and Lenders (or their respective representatives). Notwithstanding anything to the contrary in this Section 5.07, no Group Member will be required to disclose or permit the inspection or discussion of, any document, information or other matter (i) that constitutes confidential Intellectual Property, including trade secrets or other confidential proprietary information, (ii) in respect of which disclosure to the Administrative Agent or any Lender (or their respective representatives or contractors) is prohibited by Requirements of Law or any binding agreement (not entered into in contemplation hereof), or (iii) that is subject to attorney client or similar privilege or constitutes attorney work product.
Section 5.08 Use of Proceeds. Use the proceeds of the Loans only for the purposes set forth in Section 3.11.
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Section 5.09 Compliance with Environmental Laws; Environmental Reports.
(a) Except as would not reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect, (i) comply with all Environmental Laws and Environmental Permits applicable to its operations and Real Property; (ii) obtain and renew all Environmental Permits applicable to its operations and owned Real Property and, to the extent the Group Members are required to obtain such Environmental Permits under the applicable lease, leased Real Property; and (iii) comply with all lawful orders of a Governmental Authority required of the Group Members by, and in accordance with, Environmental Laws; provided that no Group Member shall be required to comply with such orders to the extent that its obligation to do so is being contested in good faith and by proper proceedings.
(b) If an Event of Default caused by reason of a breach of Section 3.17 or 5.09(a) shall have occurred and be continuing for more than 30 days without the Group Members commencing activities reasonably likely to cure such Event of Default in accordance with Environmental Laws, at the reasonable written request of the Administrative Agent or the Required Lenders through the Administrative Agent, which written request will describe the nature and subject of the Event of Default, the Borrower shall provide to the Administrative Agent within 60 days after such request (or by such later date as may be agreed to by the Administrative Agent in its sole discretion), at the expense of the Borrower, an environmental assessment report regarding the matters which are the subject of such Event of Default; provided, however, notwithstanding anything to the contrary contained herein or in any other Loan Document, under no other circumstances shall any environmental assessment report (or any other environmental report) be required under any Loan Document.
Section 5.10 Additional Collateral; Additional Guarantors.
(a) Subject to the terms of the Security Documents and Section 3.18, Section 4,01(1) and Section 5.15, with respect to any personal property acquired after the Closing Date by any Credit Party that constitutes Collateral under any of the Security Documents or is intended to be subject to the Liens created by any Security Document but is not so subject to a Lien thereunder, but in any event subject to the terms, conditions and limitations thereunder, within 60 days after the acquisition thereof, or such longer period as the Administrative Agent may approve in each case in its sole discretion, (i) execute and deliver to the Administrative Agent and the Collateral Agent such amendments or supplements to the relevant Security Documents or such other New York law governed (except in the case of certain mortgages of Material Property) documents as the Administrative Agent or the Collateral Agent shall reasonably deem necessary to grant to the Collateral Agent, for its benefit and for the benefit of the other Secured Parties, a Lien under applicable U.S. state and federal law on such Collateral subject to no Liens other than Permitted Liens, and (ii) take all actions reasonably necessary to cause such Lien to be duly perfected to the extent required by such Security Document in accordance with all applicable U.S. state and federal law, including the filing of financing statements and intellectual property security agreements in such U.S. jurisdictions as may be reasonably requested by the Administrative Agent or the Collateral Agent. The Borrower and the other Credit Parties shall otherwise take such actions and execute and/or deliver to the Collateral Agent (or its non-fiduciary agent or designee pursuant to any Intercreditor Agreement) such New York law governed (except in the case of certain mortgages of Material Property) documents as the Administrative Agent or the Collateral Agent shall reasonably require to confirm the validity, perfection and priority of the Lien of the Security Documents on such after-acquired Collateral.
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(b) Subject to the terms of the Security Documents and Section 5.15, upon the formation or acquisition of, or the re-designation of an Unrestricted Subsidiary as, a Restricted Subsidiary that is a Wholly Owned Restricted Subsidiary (other than any Excluded Subsidiary) after the Closing Date (other than a merger Subsidiary formed in connection with a Permitted Acquisition so long as such merger Subsidiary is merged out of existence pursuant to such Permitted Acquisition, or otherwise merged out of existence or dissolved, within 60 days of its formation (or such later date as permitted by the Administrative Agent in its sole discretion)) or upon any Excluded Subsidiary ceasing to constitute an Excluded Subsidiary, within 60 days after such formation, acquisition, designation or cessation, or such longer period as the Administrative Agent may approve in its reasonable discretion, the Borrower shall:
(i) deliver to the Collateral Agent the certificates, if any, representing all of the Equity Interests of such Wholly Owned Restricted Subsidiary that constitute Collateral and that are certificated securities (as defined in Article 8 of the UCC), together with undated Equity Interest powers or other appropriate instruments of transfer executed and delivered in blank by a duly authorized officer of the holder(s) of such Equity Interests, and all intercompany notes owing from such Wholly Owned Restricted Subsidiary to any Credit Party required to be delivered pursuant to the Security Agreement or other applicable Security Document and not previously so delivered, together with instruments of transfer executed and delivered in blank by a duly authorized officer of such Credit Party or Additional Guarantor, as applicable, and all other Collateral that is required to be delivered pursuant to the Security Agreements or other applicable Security Document and not previously so delivered; and
(ii) cause any such new Wholly Owned Restricted Subsidiary (except Excluded Subsidiaries), (A) to execute and deliver a Joinder Agreement or such comparable documentation to become a Subsidiary Guarantor or, to the extent the Borrower elects to join such Subsidiary as a co-borrower, in compliance with Section 2.24 hereof, a joinder agreement to the Security Agreement, substantially in the form annexed thereto, and (B) to take all actions reasonably necessary to cause the Lien created on the Collateral (which shall exclude Excluded Property and be subject to the limitations set forth herein and the applicable Security Documents) by the applicable Security Documents to be duly perfected under U.S. federal and applicable state law to the extent required by such agreements in accordance with all applicable Requirements of Law, including the filing of financing statements and intellectual property security agreements in such U.S. jurisdictions as may be reasonably requested by the Administrative Agent or the Collateral Agent; provided that, (y) no pledge of Excluded Equity Interests shall be required, and (z) no perfection actions by control (except with respect to Equity Interests and certain debt instruments), leasehold mortgages, landlord waivers or collateral access agreements shall be required to be entered into.
(c) Subject to the terms of the Security Documents and Section 5.15, upon the acquisition of any new Material Property:
(i) within fifteen Business Days after such acquisition (as such period may be extended by the Administrative Agent in its sole discretion), the applicable Credit Party shall furnish to the Collateral Agent a description of such Material Property in detail reasonably satisfactory to the Collateral Agent; and
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(ii) within ninety days after such acquisition (as such period may be extended by the Administrative Agent in its sole discretion), the applicable Credit Party shall grant to the Collateral Agent a security interest in such Material Property and deliver a mortgage, deed of trust or deed to secure debt in a form reasonably satisfactory to the Collateral Agent (a Mortgage) as additional security for the Obligations (which, if reasonably requested by the Administrative Agent, shall be accompanied by a customary legal opinion) and deliver to the Administrative Agent, a completed Life-of- Loan Federal Emergency Management Agency standard flood hazard determination, together with a notice executed by such Credit Party about special flood hazard area status, if applicable, in respect of such Mortgage.
Section 5.11 Security Interests; Further Assurances. Promptly upon reasonable request by the Administrative Agent or the Collateral Agent (i) correct any material defect or error that may be discovered in the execution, acknowledgment, filing or recordation of any Security Document or other document or instrument relating to any Collateral, and (ii) do, execute, acknowledge, deliver, record, re-record, file, re-file, register and re-register any and all such further acts, deeds, certificates, assurances and other instruments as the Administrative Agent or the Collateral Agent may reasonably request from time to time in order to carry out more effectively the purposes of this Agreement and the Security Documents; provided that, notwithstanding anything else contained herein or in any other Loan Document to the contrary, (x) the foregoing shall not apply to any Excluded Subsidiary or Property of any Excluded Subsidiary or any Excluded Property or any Excluded Equity Interests, (y) any such documents and deliverables (other than certain mortgages of Material Property) shall be governed by New York law and (z) no perfection actions by control (except with respect to Equity Interests and certain debt instruments), leasehold mortgages or landlord waivers, estoppels or collateral access letters shall be required to be entered into hereunder or under any other Loan Document. Notwithstanding the foregoing or anything else herein or in any other Loan Document to the contrary, in no event shall (A) the assets of any Excluded U.S. Subsidiary or Excluded Foreign Subsidiary (including the Equity Interests of any Subsidiary thereof) constitute security or secure, or such assets or the proceeds of such assets be required to be available for, payment of the Obligations, (B) more than 65% of the Voting Stock of and 100% of the Equity Interests that are not Voting Stock of any CFC Holding Company or Excluded Foreign Subsidiary, in each case, owned directly by a Credit Party be required to be pledged to secure the Obligations or (C) any Equity Interests of any Subsidiary owned by an Excluded Foreign Subsidiary or Excluded U.S. Subsidiary (or any Subsidiary of any Excluded Foreign Subsidiary or Excluded U.S. Subsidiary) be required to be pledged to secure the Obligations.
Section 5.12 Maintenance of Ratings. Use commercially reasonable efforts to maintain (i) a public corporate credit rating (but not any specific rating) from S&P and a public corporate family rating (but not any specific rating) from Moodys, in each case, in respect of the Borrower, and (ii) a public rating (but not any specific rating) in respect of each Class of Term Loans from each of S&P and Moodys, unless a given Class has waived the requirement to maintain any rating for such Class pursuant to the applicable Loan Documents.
Section 5.13 Compliance with Law. Comply with all Requirements of Law and all orders, writs, injunctions and decrees applicable to Holdings, the Borrower or any Subsidiary Guarantor or to their business or property, except to the extent that the failure to comply therewith could not reasonably be expected to have a Material Adverse Effect.
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Section 5.14 Anti-Terrorism Law; Anti-Money Laundering; Foreign Corrupt Practices Act.
(a) Not directly or indirectly, (i) knowingly deal in, or otherwise knowingly engage in any transaction relating to, any property or interests in property blocked pursuant to the Executive Order or any other applicable Anti-Terrorism Law in violation of any applicable Anti-Terrorism Law or applicable Sanctions, or (ii) knowingly engage in or conspire to engage in any transaction that violates or attempts to violate, any of the material prohibitions set forth in any applicable Anti-Terrorism Law or applicable Sanctions;
(b) (i) Not repay the Loans, or make any other payment to any Lender, using funds or properties of Holdings, the Borrower or any Restricted Subsidiaries that are, to the knowledge of the Borrower, the property of any Person that is the subject or target of applicable Sanctions or that are, to the knowledge of the Borrower, beneficially owned, directly or indirectly, by any Person that is the subject or target of applicable Sanctions, in each case, in violation of Anti-Terrorism Laws or applicable Sanctions or any other applicable Requirement of Law or (ii) to the knowledge of Borrower, not permit any Person that is the subject of Sanctions to have any direct or indirect interest, in Holdings, the Borrower or any of the Subsidiaries, with the result that the investment in Holdings, the Borrower or any of the Subsidiaries (whether directly or indirectly) or the Loans made by the Lenders would be in violation of any applicable Sanctions.
(c) Each Credit Party will maintain in effect and enforce policies and procedures that are reasonably designed to ensure compliance by the Credit Parties and their respective directors, officers, employees and agents with the Foreign Corrupt Practices Act of 1977, as amended.
Section 5.15 Post-Closing Deliveries.
(a) The Borrower hereby agrees to deliver, or cause to be delivered, to the Administrative Agent, in form and substance reasonably satisfactory to the Administrative Agent, the items described on Schedule 5,15 hereof, if any, on or before the dates specified with respect to such items, or such later dates as may be agreed to by, or as may be waived by, the Administrative Agent in its sole discretion.
(b) All representations and warranties contained in this Agreement and the other Loan Documents shall be deemed modified to the extent necessary to effect the foregoing (and to permit the taking of the actions described above within the time periods required above and in Schedule 5,15, rather than as elsewhere provided in the Loan Documents); provided that (x) to the extent any representation and warranty would not be true because the foregoing actions were not taken on the Closing Date or, following the Closing Date, prior to the date by which such action is required to be taken by Section 5.15(a), the respective representation and warranty shall be required to be true and correct in all material respects (except that any representation and warranty that is qualified as to materiality or Material Adverse Effect shall be true and
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correct in all respects) at the time the respective action is taken (or was required to be taken) in accordance with the foregoing provisions of this Section 5.15 (and Schedule 5,15) and (y) all representations and warranties relating to the assets set forth on Schedule 5,15 pursuant to the Security Documents shall be required to be true and correct in all material respects (except that any representation and warranty that is qualified as to materiality or Material Adverse Effect shall be true and correct in all respects) immediately after the actions required to be taken under this Section 5.15 (and Schedule 5,15) have been taken (or were required to be taken), except to the extent any such representations and warranties expressly relate to an earlier date, in which case such representations and warranties shall be true and correct in all material respects (except that any representation and warranty that is qualified as to materiality or Material Adverse Effect shall be true and correct in all respects) as of such earlier date.
ARTICLE VI
NEGATIVE COVENANTS
Each of the Credit Parties warrants, covenants and agrees with each Lender that at all times after the Closing Date, so long as this Agreement shall remain in effect and until the Commitments have been terminated and the principal of and interest on each Loan, all Fees and all other expenses or amounts payable under any Loan Document shall have been paid in full (other than contingent indemnification obligations and unasserted expense reimbursement obligations) and all Letters of Credit have been canceled or have expired and all amounts drawn thereunder have been reimbursed in full (except to the extent cash collateralized in accordance with the terms of this Agreement, backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank), none of the Credit Parties will, nor will permit any of its Restricted Subsidiaries to (it being understood that for purposes of this Article VI (other than Sections 6,06, 6,10, 6,11 and 6,13), Credit Parties and Group Members shall exclude Holdings):
Section 6.01 Indebtedness. Incur, create, assume or permit to exist, directly or indirectly, any Indebtedness, except:
(a) Indebtedness incurred under this Agreement and the other Loan Documents (including Indebtedness incurred pursuant to Section 2.20, Section 2.21, Section 2.22 and Section 2.23 hereof), any Permitted Incremental Equivalent Debt and, in each case, any Permitted Refinancing thereof;
(b) (x) Indebtedness in existence on the Closing Date and, with respect to any such Indebtedness in excess of $7,500,000 in aggregate principal amount, set forth on Schedule 6.01(b) and (y) Permitted Refinancings thereof;
(c) [reserved];
(d) Indebtedness under Hedging Obligations with respect to interest rates, foreign currency exchange rates or commodity prices not entered into for speculative purposes;
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(e) Indebtedness in respect of Purchase Money Obligations or Capital Lease Obligations, Indebtedness incurred in connection with financing Real Property (regardless of when initially acquired) and Indebtedness incurred in connection with Sale Leaseback Transactions, and any Permitted Refinancings of any of the foregoing, in an aggregate amount for all such Indebtedness under this clause (e) not to exceed, at any time outstanding, the greater of $19,500,000 and 12.5% of Consolidated EBITDA for the most recently ended Test Period, plus any additional amount so long as the First Lien Leverage Ratio as of the Applicable Date of Determination and for the applicable Test Period does not exceed 3.75 to 1.00;
(f) Indebtedness in respect of (x) appeal bonds or similar instruments and (y) payment, bid, performance or surety bonds, or other similar bonds, completion guarantees, or similar instruments, workers compensation claims, health, disability or other employee benefits, self-insurance obligations, letters of credit, and bankers acceptances issued for the account of any Group Member, in each case listed under this clause (y), in the ordinary course of business, and including guarantees or obligations of any Group Member with respect to letters of credit supporting such appeal, payment, bid, performance or surety or other similar bonds, completion guarantees, or similar instruments, workers compensation claims, health, disability or other employee benefits, self-insurance obligations and bankers acceptances (in each case other than for an obligation for money borrowed);
(g) (i) Contingent Obligations in respect of Indebtedness otherwise permitted to be incurred by such Group Member under this Section 6.01 (provided that (x) the foregoing shall not permit a non-Credit Party to guarantee Indebtedness that it could not otherwise incur under this Section 6.01 and (y) if any such Indebtedness is subordinated (including as to lien or collateral priority) to the Obligations, such Contingent Obligation shall be subordinated on terms at least as favorable to the Lenders) and (ii) Indebtedness constituting Investments permitted under Section 6.03 (other than Section 6.03(n));
(h) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business; provided, however, that such Indebtedness is extinguished within five Business Days of incurrence;
(i) Indebtedness arising in connection with the endorsement of instruments for deposit in the ordinary course of business;
(j) Indebtedness in respect of netting services or overdraft protection or otherwise in connection with deposit or securities accounts in the ordinary course of business;
(k) Indebtedness consisting of (i) the financing of insurance premiums or (ii) take or pay obligations contained in supply arrangements, in each case, in the ordinary course of business;
(l) unsecured Indebtedness of Holdings to its Subsidiaries at such times and in such amounts necessary to permit Holdings to receive any Dividend permitted to be made to Holdings pursuant to Section 6.06, so long as, as of the applicable date of determination, a Dividend for such purposes would otherwise be permitted to be made pursuant to Section 6.06; provided that any such Indebtedness shall be deemed to utilize on a dollar-for-dollar basis (but without duplication of any corresponding dollar-for-dollar reduction pursuant to Section 6.03(g), and solely for so long as such Indebtedness remains outstanding) the relevant basket under Section 6.06);
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(m) subject to Section 6.03(f), intercompany Indebtedness owing (i) by and among the Credit Parties, (ii) by Restricted Subsidiaries that are not Credit Parties to Restricted Subsidiaries that are not Credit Parties, (iii) by Restricted Subsidiaries that are not Credit Parties to Credit Parties; provided that outstanding Indebtedness under this clause (m)(iii) (together (but without duplication) with Investments made pursuant to Section 6.03(f)(iii)) shall not exceed the greater of $23,500,000 and 15% of Consolidated EBITDA at any time, and (iv) by Credit Parties to Subsidiaries that are not Credit Parties; provided that Indebtedness under this clause (m)(iv) shall be unsecured and shall be subordinated to the Obligations pursuant to the terms of the Intercompany Subordination Agreement or other subordination terms reasonably acceptable to the Administrative Agent;
(n) unsecured Indebtedness owing to employees, former employees, officers, former officers, directors, former directors (or any spouses, ex-spouses, or estates of any of the foregoing) of any Group Member in connection with the repurchase of Equity Interests of Holdings or any of its direct or indirect parent companies issued to any of the aforementioned employees, former employees, officers, former officers, directors, former directors (or any spouses, ex-spouses, or estates of any of the foregoing) of any Group Member not to exceed the sum of (i) $7,500,000 in the case of Indebtedness that does not constitute Subordinated Indebtedness plus (ii) $14,500,000 in the case of Subordinated Indebtedness, in each case, at any time outstanding;
(o) Indebtedness arising as a direct result of judgments, orders, awards or decrees against Holdings or any Restricted Subsidiaries, in each case not constituting an Event of Default;
(p) unsecured Indebtedness representing any Taxes to the extent such Taxes are being contested by any Group Member in good faith by appropriate proceedings and adequate reserves are being maintained by the Group Members in accordance with GAAP;
(q) Indebtedness assumed in connection with any Permitted Acquisition, other permitted Investment or, to the extent not constituting a Purchase Money Obligation or a Capital Lease Obligation, Capital Expenditure; provided that such Indebtedness was not incurred in contemplation of such Permitted Acquisition, other such Investment or such Capital Expenditure;
(r) at any time, Indebtedness in an amount not to exceed the amount of Dividends that may be paid at such time pursuant to Section 6.06(f), (j), (o), (q) and/or (r); provided that any such Indebtedness shall be deemed to utilize on a dollar for dollar basis such corresponding basket under Section 6.06;
(s) Indebtedness of Restricted Subsidiaries that are not Credit Parties and any joint ventures (but only to the extent non-recourse to the Credit Parties), and any guarantees thereof by Restricted Subsidiaries that are not Credit Parties, in aggregate principal amount not to exceed the greater of $46,500,000 and 30% of Consolidated EBITDA for the most recently ended Test Period at any time outstanding;
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(t) [reserved];
(u) Senior Secured Indebtedness, Junior Secured Indebtedness and Unsecured Indebtedness, in each case incurred for any purpose (including to finance a Permitted Acquisition, other permitted Investment or, to the extent not constituting a Purchase Money Obligation or a Capital Lease Obligation, Capital Expenditure), and in each case subject to compliance with the Required Debt Terms; provided that on a Pro Forma Basis immediately after giving effect to each such incurrence and the application of the proceeds therefrom (including pursuant to any Permitted Acquisition or other Investment consummated in connection therewith or the repayment or prepayment of any Indebtedness with the proceeds thereof), and any disposition, incurrence of Indebtedness, or other appropriate pro forma adjustments in connection therewith (but without, for the avoidance of doubt, giving effect to any amounts incurred in connection therewith under the Fixed Incremental Amount or the Revolving Commitments (and, in each case, for the avoidance of doubt, for purposes of calculating the Consolidated Interest Coverage Ratio, without giving effect to any interest expense attributable to any such Indebtedness incurred in connection therewith under the Fixed Incremental Amount or the Revolving Commitments, but otherwise excluding the cash proceeds of any such Indebtedness from cash and Cash Equivalents)), (i) in the case of Senior Secured Indebtedness, the First Lien Leverage Ratio as of the Applicable Date of Determination and for the applicable Test Period shall not be greater than the greater of (A) 4.50 to 1.00 and (B)the First Lien Leverage Ratio as of the Applicable Date of Determination and for the applicable Test Period immediately prior to the incurrence thereof; (ii) in the case of Junior Secured Indebtedness described in clause (a) of the definition thereof, the Senior Secured Leverage Ratio as of the Applicable Date of Determination and for the applicable Test Period is not greater than the greater of (A) 6.50 to 1.00 and (B) the Senior Secured Leverage Ratio as of the Applicable Date of Determination for the applicable Test Period immediately prior to the incurrence thereof; and (iii) in the case of Junior Secured Indebtedness described in clause (b) of the definition thereof or Unsecured Indebtedness, either (A) the Consolidated Interest Coverage Ratio computed on a Pro Forma Basis as of the Applicable Date of Determination and for the most recently ended Test Period is no less than the lesser of (I) 2.00 to 1.00 and (II) the Consolidated Interest Coverage Ratio for the most recently ended Test Period immediately prior to the incurrence thereof, or (B) the Total Leverage Ratio as of the Applicable Date of Determination and for the applicable Test Period is not greater than the greater of (I) 6.50 to 1.00 and (II) the Total Leverage Ratio as of the Applicable Date of Determination and for the applicable Test Period immediately prior to the incurrence thereof; provided further that the aggregate principal amount of Indebtedness incurred pursuant to this clause (u) by Restricted Subsidiaries that are not Credit Parties shall not exceed the greater of $34,000,000 and 22% of Consolidated EBITDA for the most recently ended Test Period at any time outstanding;
(v) Indebtedness in an aggregate amount not to exceed the greater of $39,000,000 and 25% of Consolidated EBITDA for the most recently ended Test Period incurred in connection with any accounts receivable factoring facility in compliance with Section 6.05(g);
(w) unsecured Indebtedness in the amount equal to the product of (1) two and (2) the amount of the of the aggregate cash equity contributions (excluding in respect of Disqualified Capital Stock) made to the Borrower by Holdings or any direct or indirect parent thereof after the Closing Date to the extent Not Otherwise Applied;
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(x) additional Indebtedness of the Borrower and the Restricted Subsidiaries; provided that, immediately after giving effect to any of incurrence of Indebtedness under this clause (x), the sum of the aggregate principal amount of Indebtedness outstanding under this clause (x) shall not exceed the greater of $62,000,000 and 40% of Consolidated EBITDA for the most recently ended Test Period at such time;
(y) to the extent constituting Indebtedness, advances in respect of transfer pricing or shared services agreements that are permitted by Section 6.03(z);
(z) to the extent constituting any Indebtedness, any contingent liabilities arising in connection with any stock options;
(aa) Indebtedness pursuant to trade letters of credit in an aggregate amount not to exceed the greater of $31,000,000 and 20% of Consolidated EBITDA for the most recently ended Test Period;
(bb) unsecured Indebtedness (i) incurred in a Permitted Acquisition, any other Investment or any Asset Sale, in each case to the extent constituting indemnification obligations or obligations in respect of purchase price (including Earn-Outs and any other contingent consideration obligations or deferred purchase price obligations or any Indebtedness incurred to finance such obligations) or other similar adjustments, or (ii) outstanding at any time to the seller of any business or assets permitted to be acquired by Holdings or any Restricted Subsidiary hereunder;
(cc) Indebtedness under Cash Management Agreements and other Indebtedness in respect of netting services, automatic clearinghouse arrangements, overdraft protections and similar arrangements, in each case, incurred in the ordinary course of business;
(dd) Indebtedness representing deferred compensation or other similar arrangements incurred in the ordinary course of business or in connection with a Permitted Acquisition or a similar permitted Investment;
(ee) all premiums (if any), interest (including post-petition interest), fees, expenses, charges and additional or contingent interest on obligations described in clauses (a) through (dd) above; and
(ff) customary indemnities contained in mandate, engagement and commitment letters, facility agreements, purchase agreements and indentures, in each case entered into in respect of Indebtedness permitted pursuant to this Section 6.01 and any Refinancing Debt in respect thereof.
The accrual of interest, the accretion of accreted value and the payment of interest in the form of additional Indebtedness shall not be deemed to be an incurrence of Indebtedness for purposes of this Section 6.01.
Section 6.02 Liens. Create, incur, assume or permit to exist, directly or indirectly, any Lien on any property now owned or hereafter acquired by it or on any income or revenues or rights in respect of any thereof, except the following (collectively, the Permitted Liens):
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(a) Liens for Taxes not yet due and payable and Liens for Taxes that are being contested in good faith by appropriate proceedings and for which adequate reserves have been established in accordance with GAAP;
(b) Liens in respect of property of any Group Member imposed by Requirements of Law, (i) which were incurred in the ordinary course of business and do not secure Indebtedness for borrowed money, such as carriers, warehousemens, materialmens, landlords, workmens, suppliers, repairmens and mechanics Liens and other similar Liens arising in the ordinary course of business or otherwise pertaining to Indebtedness permitted under Section 6.01(f) and (h) which do not in the aggregate materially detract from the value of the property of the Group Members, taken as a whole, and do not materially impair the use thereof in the operation of the business of the Group Members, taken as a whole, and which, if they secure obligations that are then more than 30 days overdue and unpaid, are being contested in good faith by appropriate proceedings for which adequate reserves have been established in accordance with GAAP, or (ii) arising mandatorily on the assets of any Foreign Subsidiary;
(c) any Lien in existence on the Closing Date and set forth on Schedule 6.02(c) and any Lien granted as a replacement or substitute therefor; provided that any such replacement or substitute Lien (i) does not secure an aggregate amount of Indebtedness, if any, greater than the amount of such Indebtedness secured on the Closing Date or any Permitted Refinancing thereof and (ii) does not encumber any property in a material manner other than the property subject thereto on the Closing Date and any proceeds therefrom (any such Lien, an Existing Lien);
(d) easements, rights-of-way, restrictions (including zoning restrictions), covenants, conditions, licenses, encroachments, protrusions and other similar charges or encumbrances, and title deficiencies on or other irregularities with respect to any Real Property, in each case whether now or hereafter in existence, not (i) securing Indebtedness or (ii) individually or in the aggregate materially interfering with the ordinary conduct of the business and operations of the Group Members at such Real Property and the value, use and occupancy thereof;
(e) Liens to the extent arising out of judgments, orders, attachments, decrees or awards not resulting in an Event of Default;
(f) Liens (x) imposed by Requirements of Law or deposits made in connection therewith in the ordinary course of business in connection with workers compensation, unemployment insurance and other types of social security legislation, (y) incurred to secure the performance of appeal bonds or incurred in the ordinary course of business to secure the performance of tenders, statutory obligations (other than excise taxes), surety, stay, customs bonds and statutory bonds, bids, leases (including deposits with respect thereto), government contracts, trade contracts, performance and return of money bonds and other similar obligations (exclusive of obligations for the payment of borrowed money) or (z) arising by virtue of deposits made in the ordinary course of business to secure liability for premiums to insurance
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carriers; provided that (i) with respect to subclauses (x), (y) and (z) of this clause (f), such Liens are for amounts not yet due and payable or, to the extent such amounts are so due and payable, such amounts are being contested in good faith by appropriate proceedings for which adequate reserves have been established in accordance with GAAP, which proceedings or orders entered in connection with such proceedings have the effect of preventing the forfeiture or sale of the property subject to any such Lien and (ii) to the extent such Liens are not imposed by Requirements of Law, such Liens shall in no event encumber any property other than cash and cash equivalents (including Cash Equivalents);
(g) Leases, subleases, licenses and sublicenses of any Property (other than Intellectual Property) of any Group Member granted by such Group Member to third parties, in each case entered into in the ordinary course of such Group Members business;
(h) any interest or title of a lessor, sublessor, licensor, sublicensor, licensee or sublicensee under any lease, sublease, license or sublicense not prohibited by this Agreement or the other Security Documents;
(i) Liens which may arise as a result of municipal and zoning codes and ordinances, building and other land use laws imposed by any Governmental Authority which are not violated in any material respect by existing improvements or the present use or occupancy of any real property, or in the case of any Material Property subject to a Mortgage, encumbrances disclosed in the title insurance policy issued to, and reasonably approved by, the Administrative Agent;
(j) Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods entered into by any Group Member in the ordinary course of business in accordance with the past practices of such Group Member;
(k) Liens securing Indebtedness incurred pursuant to Section 6.01(e); provided that (other than with respect to any Sale Leaseback Transaction) any such Liens attach only to the property being financed pursuant to such Indebtedness;
(l) bankers Liens, rights of setoff and other similar Liens existing solely with respect to cash and Cash Equivalents on deposit in one or more accounts maintained by any Group Member, in each case granted in the ordinary course of business in favor of the bank or banks with which such accounts are maintained, securing amounts owing to such bank with respect to cash management and operating account arrangements, including those involving pooled accounts and netting arrangements; provided that, unless such Liens are non-consensual and arise by operation of law, in no case shall any such Liens secure (either directly or indirectly) the repayment of any Indebtedness;
(m) Liens on property or assets of a person existing at the time such person or asset is acquired or merged with or into or consolidated with any Group Member to the extent not prohibited hereunder (and not created in anticipation or contemplation thereof); provided that such Liens do not extend to property not subject to such Liens at the time of acquisition (other than improvements thereon or pursuant to an after-acquired property clause in the applicable security documents) and are no more favorable (as reasonably determined by the Borrower) to the lienholders than such existing Lien;
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(n) (i) Liens granted pursuant to the Security Documents to secure the Secured Obligations (including Indebtedness incurred pursuant to Section 2.20, Section 2.21, Section 2.22 and Section 2.23 hereof) and (ii) any Liens securing Permitted Incremental Equivalent Debt, Permitted Pari Passu Refinancing Debt and Permitted Junior Refinancing Debt (in each case, to the extent permitted pursuant to the terms of such definition); provided, in each case, that such Liens are subject to any subordination or intercreditor requirements set forth in the applicable definitions referenced above in this Section 6.02(n);
(o) licenses and sublicenses of Intellectual Property granted by any Group Member in the ordinary course of business or not interfering in any material respect with the ordinary conduct of business of the Group Members;
(p) the filing of UCC (or equivalent) financing statements solely as a precautionary measure in connection with operating leases or consignment of goods;
(q) [reserved];
(r) [reserved];
(s) Liens attaching solely to cash earnest money deposits in connection with an Investment permitted by Section 6.03 (other than Section 6.03(i));
(t) Liens of a collecting bank arising in the ordinary course of business under Section 4-208 of the UCC in effect in the relevant jurisdiction covering only the items being collected upon;
(u) Liens granted by a Restricted Subsidiary (i) that is not a Credit Party in favor of any other Restricted Subsidiary in respect of Indebtedness or other obligations owed by such Restricted Subsidiary to such other Restricted Subsidiary or (ii) in favor of any Credit Party;
(v) Liens on insurance policies and the proceeds thereof granted in the ordinary course of business to secure the financing of insurance premiums with respect thereto under Section 6.01(k);
(w) Liens (i) incurred in the ordinary course of business in connection with the purchase or shipping of goods or assets (or the related assets and proceeds thereof), which Liens are in favor of the seller or shipper of such goods or assets and only attach to such goods or assets, and (ii) in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods;
(x) Liens of any Group Member with respect to Indebtedness and other obligations that do not in the aggregate exceed the greater of $23,500,000 and 15% of Consolidated EBITDA for the most recently ended Test Period at any time;
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(y) Liens on assets or property of Restricted Subsidiaries that are not Credit Parties securing Indebtedness and other obligations of such Restricted Subsidiary that is not a Credit Party permitted to be incurred pursuant to Section 6.01 (so long as such Liens do not extend to the assets of any Credit Parties);
(z) Liens on (A) Receivables Assets and related assets incurred in connection with a Receivables Facility and (B) Securitization Assets and related assets arising in connection with a Qualified Securitization Financing, in each case, in compliance with Section 6.05(g);
(aa) Liens securing Indebtedness incurred pursuant to Section 6.01(g) (so long as such Liens secure only the same assets (and any after acquired assets pursuant to any afteracquired property clause in the applicable security documents) and the same Indebtedness that such Liens secured, immediately prior to the assumption of such Indebtedness, and so long as such Liens were not created in contemplation of such assumption) and (u) (to the extent permitted to be secured, and on the lien priorities described, by the terms thereof);
(bb) Liens on cash advances in favor of the seller of any property to be acquired in an Investment permitted pursuant to Section 6.03 to be applied against the purchase price for such Investment;
(cc) Liens on Equity Interests (i) deemed to exist in connection with any options, put and call arrangements, rights of first refusal and similar rights relating to Investments in Persons that are not Restricted Subsidiaries of Holdings or (ii) of any joint venture or similar arrangement pursuant to any joint venture or similar arrangement; and
(dd) restrictions on dispositions of assets to be disposed of pursuant to merger agreements, stock or asset purchase agreements and similar agreements, in each case, solely to the extent such disposition would be permitted pursuant to the terms hereof.
Section 6.03 Investments, Loans and Advances. Directly or indirectly, lend money or credit (by way of guarantee or otherwise) or make advances to any person, or purchase or acquire any Equity Interests, bonds, notes, debentures, guarantees or other securities of, or make any capital contribution to, or acquire assets constituting all or substantially all of the assets of, or acquire assets constituting a line of business, business unit or division of, any other person (all of the foregoing, collectively, Investments), except that the following shall be permitted:
(a) the Group Members may consummate the Transactions in accordance with the provisions of the Loan Documents;
(b) (i) Investments outstanding, contemplated or made pursuant to binding commitments in effect on the Closing Date and (to the extent in excess of $7,500,000 individually) identified on Schedule 6.03(b) and (ii) Investments consisting of any modification, replacement, renewal, reinvestment or extension of any Investment described in clause (i) above; provided that the amount of any Investment permitted pursuant to this clause (ii) is not increased from the amount of such Investment on the Closing Date except pursuant to the terms of such Investment as of the Closing Date or as otherwise permitted by this Section 6.03;
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(c) the Group Members may (i) acquire and hold accounts receivable owing to any of them if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary terms, (ii) invest in, acquire and hold cash and Cash Equivalents, and other cash equivalent Investments, (iii) endorse negotiable instruments held for collection or deposit in the ordinary course of business or (iv) make lease, utility and other similar deposits in the ordinary course of business;
(d) Hedging Obligations permitted by Section 6.01(d) or otherwise in connection with non-speculative Hedging Agreements or similar arrangements (including in connection with the terminations or unwinding thereof);
(e) loans and advances (x) to directors, employees and officers of any Group Member in the ordinary course of business, or otherwise for bona fide business purposes in an aggregate amount not to exceed the greater of $11,500,000 and 7.5% of Consolidated EBITDA for the most recently ended Test Period at any time outstanding, (y) to directors, employees and officers of any Group Member (whether or not currently serving as such) to purchase Equity Interests of Holdings or any of its direct or indirect parent companies (provided that, in the case of this clause (y), any such amount loaned or advanced is simultaneously used to purchase such Equity Interests; to the extent paid in cash, such amounts shall be contributed to a Credit Party; and such loans shall not exceed in the aggregate, in any fiscal year of Holdings, the greater of $31,000,000 and 20% of Consolidated EBITDA for the most recently ended Test Period, provided, farther, that such amount may be increased, by up to an aggregate amount equal to (i) the greater of $11,500,000 and 7.5% of Consolidated EBITDA for the most recently ended Test Period, solely to the extent unutilized in the immediately preceding fiscal year and (ii) the greater of $11,500,000 and 7.5% of Consolidated EBITDA for the most recently ended Test Period solely to the extent that any additional amount utilized pursuant to this clause (ii) shall reduce the amount of Investments permitted pursuant to this Section 6.03(e) in the subsequent fiscal year on a dollar-for-dollar basis), and (z) consisting of commissions advanced to producers that may not be earned through personal production and that are earned over time or written off by the Borrower as unearned salary;
(f) Investments (i) by any Group Member in a Credit Party, (ii) by any Group Member that is not a Credit Party in any other Group Member and (iii) by any Credit Party in any Restricted Subsidiary that is not a Subsidiary Guarantor; provided that Investments under this clause (f)(iii) (together (without duplication) with outstanding intercompany Indebtedness outstanding under Section 6.01(m)(iii)) by the Borrower or a Subsidiary Guarantor in any other Subsidiary that is not a Subsidiary Guarantor (including any joint venture that constitutes a Restricted Subsidiary) shall not exceed, at any time outstanding, (A) $29,000,000 plus (B) any additional amounts to the extent that such amounts are applied substantially concurrently by such Subsidiary that is not a Subsidiary Guarantor to make a Permitted Acquisition or other permitted Investment under clause (i), (1), (r), (s), (v), (w), (x), (y), (bb) or (ff) of this Section 6.03;
(g) Investments in securities or other assets of trade creditors or customers in the ordinary course of business received in settlement of bona fide disputes or upon foreclosure or pursuant to any plan of reorganization or liquidation or similar arrangement upon the bankruptcy or insolvency of such trade creditors or customers;
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(h) Investments held by any Group Member as a result of consideration received in connection with an Asset Sale or other disposition made in compliance with Section 6.05 (other than Section 6.05(e));
(i) Permitted Acquisitions;
(j) any Group Member may make pledges and deposits permitted under Section 6.02;
(k) any Group Member may make a loan that could otherwise be made as a distribution permitted under Section 6.06 (with a commensurate dollar-for-dollar reduction of their ability to make additional distributions under such Section, for so long as such loan remains outstanding);
(l) Investments consisting of earnest money deposits required in connection with a Permitted Acquisition or other permitted Investment;
(m) Investments of any Person existing at the time such Person becomes a Restricted Subsidiary or consolidates, amalgamates or merges with any Group Member (including in connection with a Permitted Acquisition) so long as such investments were not made in contemplation of such Person becoming a Restricted Subsidiary or of such consolidation, amalgamation or merger;
(n) Contingent Obligations and other Indebtedness permitted by Section 6.01 (other than Section 6.01(g)(ii)), performance guarantees, and transactions permitted under Section 6.04 (other than Section 6.04(b));
(o) acquisitions of Term Loans by any Group Member pursuant to Section 10.04(b)(viii), and of any Permitted Incremental Equivalent Debt (or any Credit Agreement Refinancing Indebtedness in respect of any of the foregoing) and any Indebtedness incurred pursuant to Section 6.01(u), pursuant to the corresponding provision of the documents governing such Indebtedness;
(p) (x) Investments in deposit and investment accounts (including, for the avoidance of doubt, eurocurrency investment accounts) opened in the ordinary course of business with financial institutions and (y) any Investment in any Subsidiary or any joint venture in connection with intercompany cash management arrangements or related activities arising in the ordinary course of business or consistent with past practice;
(q) unsecured intercompany advances by any Group Member to Holdings for purposes and in amounts that would otherwise be permitted to be made as Dividends to Holdings pursuant to Section 6.06; provided that the principal amount of any such loans shall, for so long as such loans remain outstanding, reduce dollar-for-dollar (but without duplication of any corresponding dollar-for-dollar reduction pursuant to Section 6.01(1)) the amounts that would otherwise be permitted to be paid for such purpose in the form of Dividends pursuant to such Section;
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(r) Investments to the extent constituting the reinvestment of the Net Cash Proceeds arising from any Asset Sale (or other disposition) or Casualty Events to repair, replace or restore any property in respect of which such Net Cash Proceeds were paid or to reinvest in other fixed or Capital Assets or assets that are otherwise used or useful in the business of the Group Members (including pursuant to a Permitted Acquisition, Investment or Capital Expenditure);
(s) Investments in Unrestricted Subsidiaries in an aggregate amount not to exceed the greater of $23,500,000 and 15% of Consolidated EBITDA for the most recently ended Test Period at any time outstanding;
(t) purchases and other acquisitions of inventory, materials, equipment, intangible property and other assets in the ordinary course of business;
(u) (i) leases and subleases of real or personal property and (ii) licenses and sublicenses of Intellectual Property permitted under Section 6.02(o) and other personal property in the ordinary course of business;
(v) Investments to the extent that payment for such Investments is made solely with cash contributions from the issuance of Equity Interests (other than Disqualified Capital Stock) of Holdings or Holdings Equity Interests which are contributed as cash common equity to any Credit Party and Not Otherwise Applied;
(w) Investments in joint ventures of any Group Member; provided that the aggregate amount of such Investments outstanding at any time under this clause (w) shall not exceed the greater of $15,500,000 and 10% of Consolidated EBITDA for the most recently ended Test Period;
(x) so long as (i) to the extent any such Investment is made in reliance on clause (a) or (b) of the definition of Cumulative Amount, no Event of Default under Section 8.01(a), (b), (g) or (h), or (ii) in all other cases, no Event of Default, shall have occurred and be continuing at the time of the making of such Investment or would immediately result therefrom, Investments in an aggregate amount not to exceed the Cumulative Amount; provided that any Limited Condition Transaction remains subject to the terms of Section 1,06 hereof;
(y) other Investments in an aggregate amount at any time not to exceed the greater of (i) $39,000,000 and (ii) 25% of Consolidated EBITDA for the most recently ended Test Period at any time outstanding, plus the aggregate total of all other amounts available as a Restricted Debt Payment under Section 6.09(a)(1), plus the aggregate total of all other amounts available as a Dividend under Section 6.06(i), which the Borrower may, from time to time, elect to re-allocate to the making of Investments pursuant to this Section 6.03(y);
(z) to the extent constituting Investments, advances in respect of transfer pricing and cost-sharing arrangements (/.<?., cost-plus arrangements) that are (A) in the ordinary course of business and consistent with the Group Members historical practices and (B) funded not more than 120 days in advance of the applicable transfer pricing and cost-sharing payment;
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(aa) advances of payroll payments to employees in the ordinary course of business;
(bb) unlimited additional Investments; provided that (i) at the time of making such Investment, (A) if such Investment is made as or in connection with a Limited Condition Transaction, no Event of Default under Section 8.01(a), (b), (g) or (h), or (B) in each other case, no Event of Default, shall have occurred and be continuing or would immediately result therefrom and (ii) on a Pro Forma Basis, the First Lien Ratio as of the Applicable Date of Determination and for the most recently ended Test Period shall be no greater than 4.00 to 1.00; further provided that any Limited Condition Transaction remains subject to the terms of Section 1,06 hereof;
(cc) Investments in the ordinary course of business (x) consisting of customary trade arrangements with customers consistent with past practices and (y) in connection with obtaining, maintaining or renewing client contracts and loans or advances made to distributors;
(dd) (a) any Investment in a Receivables Subsidiary or a Securitization Subsidiary in order to effectuate a Receivables Facility or Qualified Securitization Financing, respectively, or any Investment by a Receivables Subsidiary or Securitization Subsidiary in any other Person in connection with a Receivables Facility or a Qualified Securitization Financing, respectively; provided, however, that any such Investment in a Receivables Subsidiary or a Securitization Subsidiary is in the form of a contribution of additional Receivables Assets or Securitization Assets, as applicable, or as equity or subordinated loan, and (b) distributions or payments of Receivables Fees or Securitization Fees and purchases of Receivables Assets or Securitization Assets pursuant to a Securitization Repurchase Obligation in connection with a Receivables Facility or a Qualified Securitization Financing, respectively;
(ee) Investments resulting from the exercise of drag-along rights, put-rights, call-rights or similar rights under joint venture or similar documents;
(ff) Investments in similar businesses in an aggregate amount outstanding at any time not to exceed the greater of $39,000,000 and 25% of Consolidated EBITDA for the most recently ended Test Period; and
(gg) (i) IPO Reorganization Transactions and (ii) reorganizations and other activities related to tax planning and other reorganizations; provided, in the case of this clause (ii) that, in the reasonable business judgment of the Borrower, after giving effect to any such reorganizations and activities, there is no material adverse impact on the value of the (A) Collateral granted (or the security interests granted thereon) to the Collateral Agent for the benefit of the Lenders or (B) Guarantees in favor of the Lenders, in the case of each of clauses (A) and (B), taken as a whole (any reorganizations and activities described in clause (ii) above, Permitted Reorganizations).
The amount of any Investment shall be the initial amount of such Investment less all returns of principal, capital, Dividends and other cash returns therefrom (including, without limitation, any repayments, interest, returns, profits, distributions, income or similar amounts received in cash in respect of any Investment in any Unrestricted Subsidiary and the designation thereof) and less all liabilities expressly assumed by another person in connection with the sale of such Investment; provided that any reduction in the initial amount of such Investment (including upon the re-designation of an Unrestricted Subsidiary as a Restricted Subsidiary) shall be without duplication of any increase in the Cumulative Amount.
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Section 6.04 Mergers and Consolidations. Wind up, liquidate or dissolve its affairs or consummate a merger or consolidation, except that the following shall be permitted:
(a) Asset Sales or other dispositions in compliance with Section 6.05 (other than clause (d) thereof);
(b) Investments permitted pursuant to Section 6.03 (other than clause (n) thereof);
(c) (x) any Group Member (other than the Borrower) may merge or consolidate with or into the Borrower or any Subsidiary Guarantor (as long as the Borrower is the surviving person in the case of any merger or consolidation involving the Borrower, and such Subsidiary Guarantor is the surviving person in the case of any merger or consolidation involving such Subsidiary Guarantor (other than mergers or consolidations involving the Borrower)) and (y) any Restricted Subsidiary (other than the Borrower) that is not a Guarantor may merge or consolidate with or into any other Restricted Subsidiary (other than the Borrower) that is not a Guarantor;
(d) a merger or consolidation pursuant to, and in accordance with, the definition of Permitted Acquisition to the extent necessary to consummate such Permitted Acquisition;
(e) any Restricted Subsidiary (subject to clause (f) below in the case of the Borrower) may dissolve, liquidate or wind up its affairs at any time; provided that such dissolution, liquidation or winding up, as applicable, would not reasonably be expected to have a Material Adverse Effect;
(f) the Borrower may merge or consolidate with another Borrower or any Borrower (other than Cvent) may dissolve, liquidate or wind up its affairs; provided that if Cvent is not the surviving person of any such merger or consolidation to which Cvent is a party, the surviving person of such merger or consolidation shall assume all of Cvents rights and obligations hereunder and under the other Loan Documents in its role as the Borrower; provided, further, that any such merger or consolidation, as applicable, would not reasonably be expected to have a Material Adverse Effect; and
(g) Permitted Reorganizations and IPO Reorganization Transactions.
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Section 6.05 Asset Sales. Sell, lease, assign, transfer or otherwise dispose of any property, except that the following shall be permitted:
(a) (x) sales, transfers, leases, subleases and other dispositions of inventory in the ordinary course of business, property no longer used or useful in the business or worn out, or obsolete, uneconomical, negligible or surplus property by any Group Member in the ordinary course of business, (y) the abandonment, allowance to lapse or other disposition of Intellectual Property that is, in the reasonable business judgment of the Borrower, immaterial or no longer economically practicable to maintain or (z) sales, transfers, leases, subleases and other dispositions of property by any Group Member (including Intellectual Property) that is, in the reasonable business judgment of the Borrower, immaterial or no longer used or useful in the business;
(b) any sale, lease, assignment, transfer or disposition (other than a sale of all or substantially all of the assets of the Borrower and its Restricted Subsidiaries); provided that (i) such sale, lease, assignment, transfer or disposition shall be for fair market value (as determined by the Borrower in good faith) and (ii) with respect to any aggregate consideration received in respect thereof in excess of $7,500,000, at least 75% of the purchase price for all property subject to such sale, lease, assignment, transfer or disposition shall be paid in cash or Cash Equivalents (with assumed liabilities treated as cash and other Designated Noncash Consideration treated as cash so long as the total Designated Noncash Consideration outstanding at any time does not exceed the greater of $23,500,000 and 15% of Consolidated EBITDA for the most recently ended Test Period in the aggregate, and provided that the amount of the proceeds of any portion of any such disposition that would be permitted under Section 6.05(n) shall be excluded from the numerator and denominator of such calculation);
(c) (x) leases, assignments and subleases of real or personal property in the ordinary course of business and (y) licenses and sublicenses of Intellectual Property otherwise permitted under Section 6.02;
(d) transactions in compliance with Section 6.04 (other than Section 6.04(a));
(e) Investments in compliance with Section 6.03 (other than Section 6.03(h)), Liens in compliance with Section 6.02, Dividends in compliance with Section 6.06 and Restricted Debt Payments in compliance with Section 6.09;
(f) sales of any non-core assets (i) acquired in connection with any Permitted Acquisitions or other Investments in compliance with Section 6.03 (other than Section 6.03(h)) or (ii) to obtain the approval of an anti-trust authority to a Permitted Acquisition or other permitted Investment;
(g) sales, discounts or forgiveness of customer delinquent notes or accounts receivable (including, in all events, the disposition of delinquent accounts receivable pursuant to any factoring arrangement) in the ordinary course of business or in connection with the settlement, collection or compromise thereof;
(h) use of cash and dispositions of Cash Equivalents in the ordinary course of business;
(i) sales, transfers, leases and other dispositions of assets of Holdings and its Restricted Subsidiaries that do not constitute Collateral in an amount;
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(j) sales, transfers, leases and other dispositions (i) to the Borrower or to any other Credit Party, (ii) to any Restricted Subsidiary that is not a Credit Party from another Restricted Subsidiary that is not a Credit Party, or (iii) to any of the Restricted Subsidiaries that are not Credit Parties from a Credit Party, so long as, in the case of this clause (iii), (A) if the consideration received from a Restricted Subsidiary that is not a Credit Party by a Credit Party is not below fair market value, such sale, transfer lease or other disposition does not have a material adverse impact on the value of the (y) Collateral granted to the Collateral Agent (including the security interests thereon) for the benefit of the Secured Parties or (z) Guarantees in favor of the Secured Parties, (B) to the extent any consideration received from a Restricted Subsidiary that is not a Credit Party by a Credit Party is less than fair market value, such amount below fair market value does not exceed the greater of $23,500,000 and 15% of Consolidated EBITDA for the most recently ended Test Period in the aggregate during the term of this Agreement, (C) to the extent the consideration received from a Restricted Subsidiary that is not a Credit Party is not below fair market value but there is a material adverse impact on the value of the Collateral granted to the Collateral Agent for the benefit of the Secured Parties or the Guarantees in favor of the Secured Parties, the fair market value of such sales, transfers, leases or other dispositions does not exceed the greater of $15,500,000 and 10% of Consolidated EBITDA for the most recently ended Test Period in the aggregate during the term of this Agreement, or (D) such sale, transfer, lease or other disposition is in connection with a reorganization or other activity related to tax planning and, in the reasonable business judgment of the Borrower, upon giving effect to such sale, transfer, lease or other disposition, there is no material adverse impact on the value of the (x) Collateral granted to the Collateral Agent (including the security interests thereon) for the benefit of the Lenders or (y) Guarantees in favor of the Lenders;
(k) sales, transfers, leases and other dispositions of property to the extent required by any Governmental Authority or otherwise pursuant to any Requirements of Law;
(l) sales, transfers, leases and other dispositions of property to the extent that such property constitutes an Investment permitted by Section 6.03(h) or another asset received as consideration for the disposition of any asset permitted by this Section;
(m) sales or dispositions of immaterial Equity Interests to qualify directors where required by applicable Requirements of Law or to satisfy other similar Requirements of Law with respect to the ownership of Equity Interests;
(n) any concurrent purchase and sale or exchange of any asset used or useful in the business of the Borrower and the Restricted Subsidiaries or in any line of business permitted hereunder, or any combination of any such assets and cash or Cash Equivalents, between the Borrower or a Restricted Subsidiary on one hand and another person in the other;
(o) dispositions resulting from any casualty or other insured damage to, or any taking under power of eminent domain or by condemnation or similar proceeding of, any property or asset of any Group Member;
(p) the sale or disposition of Unrestricted Subsidiaries;
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(q) any disposition of Receivables Assets in connection with any Receivables Facility and any disposition of Securitization Assets in connection with any Qualified Securitization Financing to the extent the fair market value of such Receivables Assets and Securitization Assets, respectively, disposed of in all such transactions does not exceed the greater of $31,000,000 and 20% of Consolidated EBITDA for the most recently ended Test Period in the aggregate in any fiscal year; provided that such amount may be increased by up to (x) to the extent unutilized in the immediately preceding fiscal year, the greater of $15,500,000 and 10% of Consolidated EBITDA for the most recently ended Test Period and (y) the greater of $15,500,000 and 10% of Consolidated EBITDA for the most recently ended Test Period solely to the extent that any additional amount utilized pursuant to this clause (y) shall reduce the amount of dispositions permitted pursuant to this Section 6.05(g) in the subsequent fiscal year on a dollar-for-dollar basis;
(r) [reserved];
(s) other sales or dispositions in an amount not to exceed the greater of $15,500,000 and 10% of Consolidated EBITDA for the most recently ended Test Period per transaction (or series of related transactions);
(t) Sale Leaseback Transactions in an amount not to exceed the greater of $15,500,000 and 10% of Consolidated EBITDA for the most recently ended Test Period in the aggregate;
(u) surrender or waiver of contractual rights and settlements, releases or waivers of contractual or litigation claims in the ordinary course of business;
(v) any disposition, unwinding or termination of Hedging Agreements or transactions contemplated thereby; and
(w) Permitted Reorganizations and IPO Reorganization Transactions.
To the extent the Required Lenders or all of the Lenders, as applicable, waive the provisions of this Section 6.05 with respect to the sale of any Collateral, or any Collateral is sold as permitted by this Section 6.05, such Collateral (unless sold to a Credit Party) shall be sold automatically free and clear of the Liens created by the Security Documents, and the Agents shall take all actions they reasonably deem appropriate in order to effect the foregoing.
Section 6.06 Dividends. Authorize, declare or pay, directly or indirectly, any Dividends with respect to any Group Member, except that the following shall be permitted (subject to the provisos in each of subclause (1) of Section 6.01 and subclause (q) of Section 6.03):
(a) Dividends by any Group Member (x) to the Borrower or any Subsidiary Guarantor, (y) to any Subsidiary that is not a Guarantor; provided that any such Dividend under this clause (y) is either (I) paid only in Equity Interests of such Group Member (other than Disqualified Capital Stock) or (II) if paid in cash, is paid to all shareholders on a pro rata basis, and (z) to Holdings paid only in Equity Interests in kind;
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(b) so long as no Event of Default has occurred and is continuing or would immediately result therefrom, payments to Holdings (and/or (without duplication) any direct or indirect parent company of Holdings) to permit Holdings (or any such direct or indirect parent company of Holdings) to repurchase or redeem Qualified Capital Stock of Holdings (or any direct or indirect parent company of Holdings) held by current or former officers, directors or employees (or their transferees, spouses, ex-spouses, heirs, family members, estates or beneficiaries under their estates) of any Group Member (including, without limitation, upon their death, disability, retirement, severance or termination of employment or service or to make payments on Indebtedness issued to buy such Qualified Capital Stock, including, without limitation, upon their death, disability, retirement, severance or termination of employment or service; provided that the aggregate cash consideration (for the avoidance of doubt excluding cancellation of Indebtedness owed by such person) paid for all such redemptions and payments shall not exceed, in any fiscal year, the sum of (i) the greater of $11,500,000 and 7.5% of Consolidated EBITDA for the most recently ended Test Period; provided, that such amount may be increased by (x) up to $6,000,000 or, if greater, 3.75% of Consolidated EBITDA, solely to the extent the amount available under this clause (i) was not utilized in the immediately preceding fiscal year, or (y) by up to $6,00,000 or, if greater, 3.75% of Consolidated EBITDA solely to the extent that any such additional amount utilized pursuant to this clause (y) shall reduce the amount of Dividends permitted pursuant to this Section 6.06(b)(i) in the subsequent fiscal year on a dollar-for-dollar basis plus (ii) the net cash proceeds of any key-man life insurance policies of any Group Member that are used to repurchase or redeem Qualified Capital Stock of Holdings (or any direct or indirect parent company of Holdings) held by the Person covered by the applicable key-man life insurance policy or such Persons spouse, ex-spouse, estate or beneficiaries under the estate of the Person covered by the applicable key-man life insurance policy or to make payments on Indebtedness issued to buy such Qualified Capital Stock upon such Persons death or disability; provided, further, that during an Event of Default any payments described in this clause (b) may accrue and shall be permitted to be paid upon such Event of Default no longer existing so long as no other Event of Default is continuing at such time;
(c) the Borrower and any other Subsidiary of Holdings may make Dividends, directly or indirectly, to Holdings (and Holdings may pay to any direct or indirect parent company of Holdings) to permit Holdings (or any such direct or indirect parent company of Holdings) to pay for any taxable period for which Holdings, the Borrower or any Subsidiaries of Holdings are members of a consolidated, combined or similar income tax group for federal and/or applicable state or local income tax purposes or are entities treated as disregarded from any such members for U.S. federal income Tax purposes (a Tax Group) of which Holdings (or any direct or indirect parent company of Holdings) is the common parent, any consolidated, combined or similar income Taxes of such Tax Group that are due and payable by Holdings (or such direct or indirect parent company of Holdings) for such taxable period, but only to the extent attributable to the Borrower and/or such other Subsidiaries of Holdings, provided that (x) the amount of such Dividends for any taxable period shall not exceed the amount of such Taxes that the Borrower and/or the applicable Subsidiaries of Holdings would have paid had the Borrower and/or such Subsidiaries of Holdings, as applicable, been a stand-alone corporate taxpayer (or a stand-alone corporate Tax Group) for purposes of the relevant U.S. federal, state, local or non-U. S. income taxes, taking in to account (A) any net operating losses and other tax attributes of such stand-alone corporate taxpayer (or such stand-alone corporate Tax Group) that would have been available and (B) the deductibility of U.S. state and local taxes in computing U.S. federal income taxes, to the extent relevant and (y) Dividends in respect of an Unrestricted Subsidiary shall be permitted only to the extent that Dividends were made by such Unrestricted Subsidiary to the Borrower and/or the applicable Subsidiaries for such purpose;
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(d) repurchases of Equity Interests deemed to occur upon the exercise of stock options if the Equity Interests represent a portion of the exercise price thereof;
(e) distributions or payments of Receivables Fees and Securitization Fees;
(f) so long as (i) no Event of Default shall have occurred and be continuing at the time of the making of such Dividend or would immediately result therefrom and (ii) solely to the extent such Dividends are made in reliance on clause (b) of the definition of Cumulative Amount, on a Pro Forma Basis, the First Lien Leverage Ratio as of the Applicable Date of Determination and for the most recently ended Test Period is no greater than 4.50 to 1.00, the Group Members may make Dividends to Holdings and/or (without duplication) Holdings direct or indirect equity holders using the Cumulative Amount; provided that any Limited Condition Transaction remains subject to the terms of Section 1,06 hereof;
(g) Dividends made solely in Equity Interests of Holdings (other than Disqualified Capital Stock);
(h) Dividends to finance payments expressly permitted by Section 6.07(d), and payments for reasonable director fees and reasonable and documented director indemnities and expenses, may be paid as a Dividend;
(i) Dividends to the extent that payment for such Dividends is made solely with cash contributions from the issuance of Equity Interests (other than Disqualified Capital Stock) of Holdings, which are contributed as cash common equity to any Credit Party and Not Otherwise Applied;
(j) so long as no Event of Default shall have occurred and be continuing or would immediately result therefrom, additional Dividends may be made by any Group Member to Holdings and/or (without duplication) Holdings direct or indirect equity holders) in an aggregate amount not to exceed the greater of $55,000,000 and 35.0% of Consolidated EBITDA for the most recently ended Test Period, less the aggregate amount re-allocated to Section 6.03(y) by the Borrower pursuant to Section 6.03(y), reallocated to Section 6.09(a)(1) pursuant to Section 6.09(a)(1);
(k) distributions for (i) administrative, overhead and related expenses (including franchise and similar taxes required to maintain corporate existence and other legal, accounting and other overhead expenses) of Holdings or any direct or indirect parent of Holdings to the extent directly attributable to the operations or ownership of the Group Members, and (ii) Public Company Costs;
(l) so long as no Event of Default shall have occurred and be continuing or would immediately result therefrom, distributions to any of Holdings direct or indirect equity holders of any working capital adjustment or any other purchase price adjustment received in connection with any Permitted Acquisition or any other Investment permitted under Section 6.03; provided that, with respect to any Permitted Acquisition or other Investment, the amount of such distribution shall be limited to the Equity Funded Portion thereof;
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(m) Dividends by any Group Member to any direct or indirect holder of any Equity Interests in the Borrower:
(i) to finance any Investment permitted to be made pursuant to Section 6.03; provided that (A) such Dividend shall be made substantially concurrently with the closing of such Investment and (B) Holdings or such other parent shall, immediately following the closing thereof, cause (1) all property so acquired (whether assets or Equity Interests) to be held by or contributed to the Borrower or a Restricted Subsidiary or (2) the merger (to the extent permitted in Section 6.04) of the Person formed or acquired into the Borrower or any other Restricted Subsidiary in order to consummate such Permitted Acquisition;
(ii) the proceeds of which shall be used to pay customary costs, fees and expenses (other than to Affiliates) related to any successful or unsuccessful equity or debt offering, debt incurrence, Investment (including, for the avoidance of doubt, any Permitted Acquisition) or other transaction, in each case, to the extent not prohibited by this Agreement; and
(iii) the proceeds of which shall be used to pay customary salary, bonus and other benefits payable to officers and employees of any direct or indirect parent company or partner of the Borrower to the extent such salaries, bonuses and other benefits are attributable to the ownership or operation of the Borrower and their Restricted Subsidiaries;
(n) Dividends to the extent required to pay AHYDO catch-up payments relating to a borrowing of any Credit Party;
(o) unlimited additional Dividends; provided that (i) at the time of making such Dividend, (A) if such Dividend is made in connection with a Limited Condition Transaction, no Event of Default under Section 8.01(a), (b), (g) or (h), or (B) in each other case, no Event of Default, shall have occurred and be continuing or would immediately result therefrom and (ii) on a Pro Forma Basis, the First Lien Leverage Ratio as of the Applicable Date of Determination and for the most recently ended Test Period shall be no greater than 4.50 to 1.00; provided that any Limited Condition Transaction remains subject to the terms of Section 1,06 hereof;
(p) [reserved];
(q) following the consummation of an IPO, so long as no Event of Default shall have occurred and be continuing on the date of declaration of any such Dividend or would result therefrom, the Borrower may (or may make Dividends to Holdings or any parent company of the Borrower to enable it to) make Dividends with respect to any Equity Interest in an amount of up to 7% per annum of the market capitalization of Holdings (or the applicable public filing entity) and its Subsidiaries;
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(r) (i) Dividends constituting any part of (x) a Permitted Reorganization (and to pay any costs or expenses related thereto) and (y) an IPO Reorganization Transaction and (ii) Dividends to pay costs or expenses related to any IPO (or IPO Reorganization Transactions) whether or not such IPO (and any related IPO Reorganization Transactions) is consummated; and
(s) Dividends and distributions among Credit Parties in connection with transfer pricing or shared services agreements to the extent advances related thereto are permitted pursuant to Section 6.03(z).
Section 6.07 Transactions with Affiliates. Except as otherwise permitted hereunder, enter into, directly or indirectly, any transaction or series of related transactions with a fair market value in excess of the greater of $4,000,000 and 2.5% of Consolidated EBITDA for the most recently ended Test Period, whether or not in the ordinary course of business, with any Affiliate of any Group Member (other than among the Borrower and any Guarantor or any entity that becomes a Subsidiary Guarantor as a result of such transactions), other than on terms and conditions at least as favorable to such Group Member (or, in the case of a transaction between a Credit Party and a Subsidiary that is not a Credit Party, such Credit Party) as would reasonably be obtained by such Group Member at that time in a comparable arms-length transaction with a person other than an Affiliate (as reasonably determined by the Borrower), except that the following shall be permitted:
(a) (i) Dividends permitted by Section 6.06, (ii) Liens granted pursuant to Section 6.02, (iii) Investments permitted by Section 6.03 and Indebtedness resulting therefrom permitted under Section 6.01, (iv) transactions permitted by Section 6.04 or Section 6.10, (v) dispositions permitted under Section 6.05 and (z) payments of Indebtedness permitted under Section 6.09;
(b) director, officer and employee compensation (including bonuses) and other benefits (including, without limitation, retirement, health, incentive equity and other benefit plans) and expense reimbursement and indemnification arrangements and severance agreements;
(c) transactions with customers, clients, suppliers, joint venture partners or purchasers or sellers of goods and services, in each case in the ordinary course of business and otherwise not prohibited by the Loan Documents;
(d) (i) the payment of all reasonable and documented fees as set forth in the Management Services Agreement (including, without limitation, any financial advisory, monitoring, management, consulting, oversight and similar fees (including fees in connection with refinancings or subsequent transactions and termination fees) and (ii) the payment of all reasonable and documented out-of-pocket, expenses and indemnification claims required to be paid under any agreement with the Equity Investors relating to the services provided to the Group Members by the Equity Investors (including reasonable and documented out-of-pocket, expenses and indemnification claims paid pursuant to the Management Services Agreement);
(e) [reserved];
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(f) any transaction with an Affiliate where the only consideration paid by any Credit Party is Qualified Capital Stock of Holdings (or Equity Interests of a direct or indirect parent company of Holdings);
(g) agreements relating to Intellectual Property not interfering in any material respect with the ordinary conduct of business of or the value of such Intellectual Property to such Group Member or materially impairing the security interest granted under the Security Agreement therein held by the Collateral Agent;
(h) any other agreement, arrangement or transaction as in effect on the Closing Date and listed on Schedule 6,07, and any amendment or modification with respect to such agreement, arrangement or transaction, and the performance of obligations thereunder, so long as such amendment or modification is not materially adverse to the interests of the Lenders;
(i) the Transactions as contemplated by the Loan Documents, including the payment of any fees, costs or expenses related to such Transactions;
(j) transactions pursuant to provisions of the Loan Documents with the Equity Investors and Affiliated Debt Funds (in each case, in their respective capacities as Lenders);
(k) transactions entered into by an Unrestricted Subsidiary with an Affiliate prior to the re-designation of any such Unrestricted Subsidiary as a Restricted Subsidiary pursuant to the definition of Unrestricted Subsidiary; provided that such transactions were not entered into in contemplation of such re-designation;
(l) transactions constituting any part of a Permitted Reorganization and IPO Reorganization Transaction;
(m) transactions among Holdings and/or any of its Restricted Subsidiaries that are not otherwise prohibited hereunder; and
(n) transactions pursuant to transfer pricing or shared services agreements, advances with respect to which are permitted by Section 6.03(z).
Section 6.08 First Lien Leverage Ratio. Except with the written consent of the Required Revolving Lenders and subject to the last paragraph of this Section 6.08, permit the First Lien Leverage Ratio as of the last day of and for any Test Period to be greater than 7.20 to 1.00.
Notwithstanding the foregoing, this Section 6.08 shall be in effect (and shall only be in effect) when the aggregate principal amount of outstanding Revolving Loans, Swing Line Loans, Reimbursement Obligations and (solely to the extent in excess of $7,500,000 in the aggregate) outstanding but undrawn Letters of Credit that have not been cash collateralized in accordance with the terms of this Agreement exceed 35% of the aggregate Revolving Commitments of all Lenders as of the last day of such Test Period, commencing with the first full fiscal quarter of Holdings commencing after the Closing Date (it being understood that calculation of compliance with this Section 6.08 shall be determined as of the last day of and for each applicable Test Period).
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Section 6.09 Prepayments of Certain Indebtedness; Modifications of Organizational Documents and Other Documents, etc.
(a) Directly or indirectly make any voluntary or optional payment or prepayment of, or repurchase, redemption or acquisition for value of, or any prepayment or redemption as a result of any Asset Sale, change of control or similar event of, any Indebtedness outstanding under documents evidencing any Indebtedness that is (1) secured on a junior lien basis to the Obligations, unsecured or subordinated and (2) in each case, in excess of $21,500,000 in aggregate outstanding principal amount (Restricted Debt Payment) except (A) to the extent not prohibited by this Agreement, any applicable Intercreditor Agreement or any subordination terms applicable to any such Subordinated Indebtedness (including pursuant to a Permitted Refinancing), with the Cumulative Amount, so long as (i) no Event of Default shall have occurred and be continuing at the time of the making of such Restricted Debt Payment or would immediately result therefrom and (ii) solely to the extent such payment, prepayment, repurchase, redemption or acquisition is made in reliance on clause (b) of the definition of Cumulative Amount, on a Pro Forma Basis, the First Lien Leverage Ratio as of the Applicable Date of Determination and for the most recently ended Test Period is no greater than 4.50 to 1.00, (B) in connection with any Permitted Refinancing thereof or to the extent made with the proceeds of Qualified Capital Stock of Holdings that are Not Otherwise Applied; provided that in the case of any refinancing of Permitted Junior Refinancing Debt or other Indebtedness subject to any applicable Intercreditor Agreement, such refinancing must be permitted by such Intercreditor Agreement or, if applicable, the other customary subordination documentation related to such Permitted Junior Refinancing Debt or such other Indebtedness, (C) [reserved], (D) prepaying, redeeming, purchasing, defeasing or otherwise satisfying prior to the scheduled maturity thereof (or setting apart any property for such purpose) (1) in the case of any Group Member that is not a Credit Party, any Indebtedness owing by such Group Member to any other Group Member, (2) otherwise, any Indebtedness owing to any Credit Party and (3) so long as no Event of Default is continuing or would immediately result therefrom, any mandatory prepayments of Indebtedness incurred under clauses (b) and (e) of Section 6.01 and any Permitted Refinancing thereof, (E) making regularly scheduled or otherwise required payments of interest and mandatory prepayments in respect of such Indebtedness and payments of fees, expenses and indemnification obligations thereunder (to the extent not restricted by any applicable intercreditor or subordination terms), (F) to the extent that such payment is made solely with cash contributions from the issuance of Equity Interests (other than Disqualified Capital Stock) of Holdings, which are contributed as cash common equity to any Credit Party and Not Otherwise Applied, (G) converting (or exchanging) any Indebtedness to (or for) Qualified Capital Stock of Holdings, (H) if applicable, any AHYDO catch-up payments with respect thereto, (I) making prepayments, redemptions, purchases, defeasance or other satisfaction of Indebtedness in an amount not to exceed the greater of $55,000,000 and 35% of Consolidated EBITDA for the most recently ended Test Period less the aggregate amount re-allocated to Section 6.03(y) by the Borrower pursuant to Section 6.03(y), plus any unused amounts under Section 6.06(i), (J) so long as no Default or Event of Default has occurred and is then continuing and the First Lien Leverage Ratio computed on a Pro Forma Basis as of the Applicable Date of Determination and for the most recently ended Test Period is no greater than 4.50 to 1.00, making prepayments, redemptions, purchases, defeasance or other satisfaction of such Indebtedness; provided that any Limited Condition Transaction remains subject to the terms of Section 1,06 hereof, (K) mandatory prepayments of any Incremental Facility and/or Permitted
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Incremental Equivalent Debt and/or Junior Secured Indebtedness that, in each case, is secured on a junior basis to the Secured Obligations (or any Permitted Refinancing thereof) with Declined Proceeds or as otherwise permitted by Section 2.10(h) to the extent not prohibited by any applicable Intercreditor Agreement, (L) in connection with the refinancing of any Indebtedness acquired in connection with a Permitted Acquisition or similar Investment to the extent such Indebtedness was not incurred in contemplation of such Permitted Acquisition or similar Investment), (M) any payments of intercompany obligations permitted under the Intercompany Subordination Agreement or the other subordination terms approved by the Administrative Agent pursuant to Section 6.01(m) hereunder and (N) on the Effective Date, the Second Lien Refinancing;
(b) amend, modify or change in any manner material and adverse to the interests of the Lenders any term or condition of documents evidencing Indebtedness that is secured on a junior lien basis to the Obligations, Indebtedness that is unsecured or Subordinated Indebtedness (in, each case, other than any amendment, modification or change that is expressly provided for in an Intercreditor Agreement or Subordinated Debt Documents) without the consent of the Required Lenders (not to be unreasonably withheld or delayed); and
(c) to the extent that its shares are secured in favor of the Secured Parties pursuant to any Security Agreement, terminate, amend, modify or change any of its Organizational Documents (including by the filing or modification of any certificate of designation) or any agreement to which it is a party with respect to its Equity Interests (including any stockholders agreement), other than any such amendments, modifications or changes or such new agreements which are not materially adverse to the interests of the Lenders.
Section 6.10 Holding Company Status. With respect to Holdings, engage in any business or activity, hold any assets or incur any Indebtedness or other liabilities, other than (i) its ownership of Equity Interests in its Subsidiaries, intercompany notes permitted hereunder, cash and Cash Equivalents, notes of officers, directors and employees permitted hereunder, and all other activities incidental to its ownership of Equity Interests in its Subsidiaries or related to the management of its investment in its Subsidiaries, (ii) maintaining its corporate existence, (iii) participating in tax, accounting and other administrative activities as a member of the consolidated group of companies including the Credit Parties, (iv) executing, delivering and performing rights and obligations under the Loan Documents (including any documents governing the terms of, or entered into in connection with, any Incremental Facility or Permitted Incremental Equivalent Debt or, in each case, any Credit Agreement Refinancing Indebtedness in respect thereof or Permitted Debt Exchange Notes issued in exchange therefor), the other Loan Documents, any documents and agreements relating to any Permitted Acquisition or Investment permitted hereunder to which it is a party, or the documents governing any other Indebtedness permitted hereunder and not described above that is guaranteed by (and permitted to be guaranteed by) Holdings, (v) performance of rights and obligations under any management services agreement (including the Management Services Agreement) to which it is a party, (vi) making any Dividend permitted by Section 6.06, (vii) purchasing or acquiring Qualified Capital Stock in any Subsidiary, (viii) making capital contributions to its first-tier Subsidiaries, (ix) taking actions in furtherance of and consummating an IPO, and fulfilling all initial and ongoing obligations related thereto, (x) executing, delivering and performing rights and obligations under any employment agreements and any documents related thereto, (xi) purchasing Obligations
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(including obligations under any Incremental Facility or any Permitted Incremental Equivalent Debt or, in each case, any Credit Agreement Refinancing Indebtedness in respect thereof or Permitted Debt Exchange Notes issued in exchange therefor) or any Indebtedness incurred pursuant to Section 6.01(u) in accordance with this Agreement or the documents governing any Incremental Facility, Permitted Incremental Equivalent Debt, Credit Agreement Refinancing Indebtedness, Permitted Debt Exchange Notes or other Indebtedness, (xii) the buyback and sales of equity from or to officers, directors and managers of Holdings and its Subsidiaries and other persons in accordance with Section 6.06(b), (xiii) the making of loans to officers, directors (or other Persons in comparable positions), and employees and others in exchange for Equity Interests of any Credit Party or its Subsidiaries purchased by such officers, directors (or other Persons in comparable positions), employees or others pursuant to Section 6.03(e) and the acceptance of notes related thereto, (xiv) transactions expressly described herein as involving Holdings and permitted under this Agreement, (xv) the incurrence of unsecured Indebtedness that requires the payment of interest in cash solely to the extent that the Borrower and its Restricted Subsidiaries are permitted by the terms of this Agreement to make Dividends to Holdings for such purpose, (xvi) Permitted Reorganizations or any IPO Reorganization Transaction, (xvii) with respect to intercompany loans otherwise permitted hereunder, (xviii) providing guarantees with respect to the performance of rights and obligations under contracts and agreements of its Subsidiaries and taking actions in furtherance thereof, and (xix) activities incidental to the businesses or activities described in clauses (i) through (xviii) above.
Section 6.11 No Further Negative Pledge; Subsidiary Distributions. Enter into any agreement, instrument, deed or lease which (a) prohibits or limits the ability of any Credit Party to create, incur, assume or suffer to exist any Lien upon any of their respective properties or revenues, whether now owned or hereafter acquired, or which requires the grant of any security for an obligation if security is granted for another obligation or (b) prohibits, restricts or imposes any condition upon the ability of any Restricted Subsidiary that is not a Credit Party from paying dividends or other distributions with respect to any of its Equity Interests or to make or repay loans or advances to any Restricted Subsidiary or to Guarantee Indebtedness of any Restricted Subsidiary, in each case, except the following: (i) this Agreement and the other Loan Documents, and any documents governing any Incremental Facility or any Permitted Incremental Equivalent Debt or, in each case, any Credit Agreement Refinancing Indebtedness in respect thereof or Permitted Debt Exchange Notes issued in exchange therefor or any Indebtedness incurred pursuant to Section 6.01(u); provided that such Incremental Facilities, Permitted Incremental Equivalent Debt, Credit Agreement Refinancing Indebtedness, Permitted Debt Exchange Notes and other Indebtedness are no more materially restrictive with respect to such prohibitions, restrictions and conditions than the applicable terms of this Agreement; (ii) covenants in documents creating Liens permitted by Section 6.02 prohibiting further Liens on the properties encumbered thereby; (iii) [reserved]; (iv) any other agreement that does not restrict in any manner (directly or indirectly) Liens created pursuant to the Loan Documents on any Collateral securing the Secured Obligations and does not require the direct or indirect granting of any Lien securing any Indebtedness or other obligation by virtue of the granting of Liens on or pledge of property of any Credit Party to secure the Secured Obligations; (v) customary covenants and restrictions in any indenture, agreement, document, instrument or other arrangement relating to non-material assets or business of any Subsidiary existing prior to the consummation of a Permitted Acquisition in which such Subsidiary was acquired (and not created in contemplation of such Permitted Acquisition); (vi) customary restrictions on cash or
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other deposits; (vii) net worth provisions in leases and other agreements entered into by a Group Member in the ordinary course of business and/or in the documents entered into in connection with any Qualified Securitization Financing or Receivables Facility; (viii) contractual encumbrances or restrictions existing on the Closing Date and identified on Schedule 6,11; and (ix) any prohibition or limitation that (I) exists pursuant to applicable Requirements of Law, (II) consists of customary restrictions and conditions contained in any agreement relating to the sale of any property permitted under Section 6.05, stock sale agreement, joint venture agreement, sale/leaseback agreement, purchase agreements, or acquisition agreements (including by way of merger, acquisition or consolidation) entered into by a Credit Party or any Subsidiary solely to the extent pending the consummation of such transaction, which covenant or restriction is limited to the assets that are the subject of such agreements, (III) restricts subletting or assignment of leasehold interests contained in any Lease governing a leasehold interest of a Credit Party or a Subsidiary, or (IV) is imposed by any amendments or refinancings that are otherwise permitted by the Loan Documents of the contracts, instruments or obligations referred to in immediately preceding clauses (i) through (ix) of this Section 6.11; provided that such amendments and refinancings are no more materially restrictive with respect to such prohibitions and limitations than those prior to such amendment or refinancing.
Section 6.12 Nature of Business. The Borrower and its Restricted Subsidiaries will not engage in any material line of business other than lines of business substantially similar to the lines of business conducted by the Borrower and its Restricted Subsidiaries on the Closing Date or any business reasonably related, similar, corollary, complementary, incidental or ancillary thereto.
Section 6.13 Fiscal Year. Change its fiscal year end date to a date other than December 31, other than with prior written notice to the Administrative Agent.
ARTICLE VII
GUARANTEE
Section 7.01 The Guarantee. Each Guarantor and the Borrower hereby jointly and severally guarantees, as a primary obligor and not as a surety, to each Secured Party and its successors and assigns, the prompt payment in full when due (whether at stated maturity, by required prepayment, declaration, demand, or acceleration or otherwise) of the principal of and interest on (including any interest, fees, costs or charges that would accrue but for the provisions of Title 11 of the United States Code after any bankruptcy or insolvency petition under Title 11 of the United States Code) the Loans made by the Lenders to, and the Notes held by each Lender of, the Borrower, and all other Secured Obligations from time to time owing to the Secured Parties by any Credit Party under any Loan Document or any Secured Cash Management Agreement or Secured Hedging Agreement entered into with a counterparty that is a Secured Party, in each case strictly in accordance with the terms thereof (such obligations being herein collectively called the Guaranteed Obligations). Each Guarantor and the Borrower hereby jointly and severally agree that if, in the case of such Guarantor, the Borrower or any other Guarantor, and in the case of the Borrower, any Guarantor, shall fail to pay in full when due (whether at stated maturity, by acceleration or otherwise) any of the Guaranteed Obligations, the Guarantors and the Borrower in its capacity as a Guarantor under this Article VII will, promptly pay the same in cash, without any demand or notice whatsoever, and that in the case of any
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extension of time of payment or renewal of any of the Guaranteed Obligations, the same will be promptly paid in full when due (whether at extended maturity, by acceleration or otherwise) in accordance with the terms of such extension or renewal. Notwithstanding any provision hereof or in any other Loan Document to the contrary, no Obligation in respect of any Secured Hedging Agreement shall be payable by or from the assets of any Credit Party if such Credit Party, is not, at the later of (i) the time such Secured Hedging Agreement is entered into and (ii) the date such person becomes a Credit Party, an eligible contract participant as such term is defined in Section l(a)(18) of the Commodity Exchange Act, as amended, and no Credit Party shall be deemed to have entered into or guaranteed any Hedging Agreement at any time that such Credit Party is not an eligible contract participant. The guarantee made by the Borrower hereunder relates solely to the Secured Obligations from time to time owing to the Secured Parties by any Credit Party other than the Borrower under any Secured Cash Management Agreement or Secured Hedging Agreement.
Each Qualified ECP Guarantor hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Credit Party to honor all of its obligations under this Guarantee in respect of Swap Obligations (provided, however, that each Qualified ECP Guarantor shall only be liable under this Section 7.01 for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Section 7.01, or otherwise under this Guarantee, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). The obligations of each Qualified ECP Guarantor under this Section 7.01 shall remain in full force and effect until the termination of this Guarantee in accordance with Section 7.09 hereof. Each Qualified ECP Guarantor intends that this Section 7.01 constitute, and this Section 7.01 shall be deemed to constitute, a keepwell, support, or other agreement for the benefit of each other Credit Party for all purposes of Section la(18)(A)(v)(II) of the Commodity Exchange Act.
Section 7.02 Obligations Unconditional. The obligations of the Guarantors and the Borrower under Section 7.01 shall constitute a guaranty of payment of Guaranteed Obligations and, to the fullest extent permitted by applicable Requirements of Law, are absolute, irrevocable and unconditional, and joint and several, irrespective of the value, genuineness, validity, regularity or enforceability of the Guaranteed Obligations of the Borrower or the applicable Guarantor under this Agreement, the Notes, if any, or any other agreement or instrument referred to herein or therein, or any substitution, release or exchange of any other guarantee of or security for any of the Guaranteed Obligations, and, irrespective of any other circumstance whatsoever that might otherwise constitute a legal or equitable discharge or defense of a surety or Guarantor (except for payment in full (other than contingent indemnity obligations, unasserted expense reimbursement obligations, obligations and liabilities under Secured Cash Management Agreements and Secured Hedging Agreements with respect to which arrangements satisfactory to the applicable Cash Management Bank or Hedge Bank shall have been made, and Letters of Credit that have been cash collateralized in accordance with the terms of this Agreement, backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank)). Without limiting the generality of the foregoing and subject to applicable law, it is agreed that the occurrence of any one or more of the following shall not alter or impair the liability of the Guarantors hereunder, which shall remain absolute, irrevocable and unconditional under any and all circumstances as described above:
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(a) at any time or from time to time, without notice to the Borrower or the Guarantors, the time for any performance of or compliance with any of the Guaranteed Obligations shall be extended, or such performance or compliance shall be waived;
(b) any of the acts mentioned in any of the provisions of this Agreement or the Notes, if any, or any other agreement or instrument referred to herein or therein shall be done or omitted (except in each case for payment in full of the Guaranteed Obligations (other than contingent indemnity obligations, unasserted expense reimbursement obligations, obligations and liabilities under Secured Cash Management Agreements and Secured Hedging Agreements with respect to which arrangements satisfactory to the applicable Cash Management Bank or Hedge Bank shall have been made, and Letters of Credit that have been cash collateralized in accordance with the terms of this Agreement, backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank);
(c) the maturity of any of the Guaranteed Obligations shall be accelerated, or any of the Guaranteed Obligations shall be amended in any respect, or any right under the Loan Documents or any other agreement or instrument referred to herein or therein shall be amended or waived in any respect or any other guarantee of any of the Guaranteed Obligations or any security therefor shall be released or exchanged in whole or in part or otherwise dealt with;
(d) any Lien or security interest granted to, or in favor of, the Issuing Bank or any Lender, Agent or other Secured Party as security for any of the Guaranteed Obligations shall fail to be perfected; or
(e) the release of any other Guarantor pursuant to Section 9,10.
The Guarantors and the Borrower hereby expressly waive, to the extent permitted by law, diligence, presentment, demand of payment, protest and all notices whatsoever (except as specifically provided for herein or in any other Loan Document), and any requirement that any Secured Party exhaust any right, power or remedy or proceed against the Borrower under this Agreement or the Notes, if any, or any other agreement or instrument referred to herein or therein, or against any other person under any other guarantee of, or security for, any of the Guaranteed Obligations. The Guarantors and the Borrower waive, to the extent permitted by law, any and all notice of the creation, renewal, extension, waiver, termination or accrual of any of the Guaranteed Obligations and notice of or proof of reliance by any Secured Party upon this Guarantee or acceptance of this Guarantee, and the Guaranteed Obligations, and any of them, shall be deemed to have been created, contracted or incurred in reliance upon this Guarantee, and all dealings between the Borrower and the Secured Parties shall likewise be presumed to have been had or consummated in reliance upon this Guarantee. This Guarantee shall be construed as a continuing, absolute, irrevocable and unconditional guarantee of payment of the Guaranteed Obligations without regard to any right of offset with respect to the Guaranteed Obligations at any time or from time to time held by Secured Parties, and the obligations and liabilities of the Guarantors and the Borrower hereunder shall not be conditioned or contingent upon the pursuit
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by the Secured Parties or any other person at any time of any right or remedy against the Borrower or against any other person which may be or become liable in respect of all or any part of the Guaranteed Obligations or against any collateral security or guarantee therefor or right of offset with respect thereto. This Guarantee shall remain in full force and effect and be binding in accordance with and to the extent of its terms upon the Guarantors and the Borrower and the successors and assigns thereof, and shall inure to the benefit of the Lenders, and their respective successors and permitted assigns, notwithstanding that from time to time during the term of this Agreement there may be no Guaranteed Obligations outstanding.
Section 7.03 Reinstatement. The obligations of the Guarantors and the Borrower under this Article VII shall be automatically reinstated if and to the extent that for any reason any payment by or on behalf of the Borrower or any other Credit Party in respect of the Guaranteed Obligations is rescinded or must be otherwise restored by any holder of any of the Guaranteed Obligations, in each case, including as a result of any proceedings in bankruptcy or reorganization or pursuant to a Debtor Relief Law.
Section 7.04 Subrogation; Subordination. Each Guarantor hereby agrees that, until the payment and satisfaction in full in cash of all Guaranteed Obligations (other than contingent indemnification obligations, unasserted expense reimbursement obligations, obligations and liabilities under Secured Cash Management Agreements and Secured Hedging Agreements with respect to which arrangements satisfactory to the applicable Cash Management Bank or Hedge Bank shall have been made, and Letters of Credit that have been cash collateralized in accordance with the terms of this Agreement, backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank) and the expiration or termination of the Commitments of the Lenders under this Agreement, it shall subordinate and not exercise any claim and shall not exercise any right or remedy, direct or indirect, arising by reason of any performance by it of its guarantee in Section 7.01, whether by subrogation or otherwise, against the Borrower or any other Guarantor of any of the Guaranteed Obligations or any security for any of the Guaranteed Obligations. Any Indebtedness of any Credit Party permitted pursuant to Section 6.01(m) shall be subordinated to such Credit Partys Guaranteed Obligations; provided that upon the payment and satisfaction in full of all Guaranteed Obligations (other than contingent indemnification obligations, unasserted expense reimbursement obligations, obligations and liabilities under Secured Cash Management Agreements and Secured Hedging Agreements with respect to which arrangements satisfactory to the applicable Cash Management Bank or Hedge Bank shall have been made, and Letters of Credit that have been cash collateralized in accordance with the terms of this Agreement, backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank), the expiration or termination of the Commitments of the Lenders under this Agreement and the cancellation or expiration of all Letters of Credit (except to the extent cash collateralized in accordance with the terms of this Agreement, backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank), without any further action by any person, the Guarantors shall be automatically subrogated to the rights of the Administrative Agent and the Lenders, and may exercise their rights of contribution pursuant to Section 7,10, in each case to the extent of any payment hereunder.
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Section 7.05 Remedies. Subject to the terms of any applicable Intercreditor Agreement, the Guarantors jointly and severally agree that, as between the Guarantors and the Lenders, the obligations of the Borrower under this Agreement and the Notes, if any, may be declared to be forthwith due and payable as provided in Section 8.01 (and shall be deemed to have become automatically due and payable in the circumstances provided in Section 8.01) for purposes of Section 7.01, notwithstanding any stay, injunction or other prohibition preventing such declaration (or such obligations from becoming automatically due and payable) as against the Borrower and that, in the event of such declaration (or such obligations being deemed to have become automatically due and payable), such obligations (whether or not due and payable by the Borrower) shall forthwith become due and payable by the Guarantors for purposes of Section 7.01.
Section 7.06 Instrument for the Payment of Money. Each Guarantor hereby acknowledges that the guarantee in this Article VII constitutes an instrument for the payment of money, and consents and agrees that any Lender or Agent, at its sole option, in the event of a dispute by such Guarantor in the payment of any moneys due hereunder, shall have the right to bring a motion or action under New York CPLR Section 3213.
Section 7.07 Continuing Guarantee. The guarantee in this Article VII is a continuing guarantee of payment, and shall apply to all Guaranteed Obligations whenever arising.
Section 7.08 General Limitation on Guarantee Obligations. In any action or proceeding involving any state corporate, limited partnership or limited liability company law, or any applicable state, federal or foreign bankruptcy, insolvency, reorganization or other law affecting the rights of creditors generally, if the obligations of any Guarantor under Section 7.01 would otherwise be held or determined to be void, voidable, invalid or unenforceable, or subordinated to the claims of any other creditors, on account of the amount of its liability under Section 7.01, then, notwithstanding any other provision to the contrary, the amount of such liability shall, without any further action by such Guarantor, any Credit Party or any other person, be automatically limited and reduced to the highest amount (after giving effect to the right of contribution established in Section 7,10) that is valid and enforceable and not subordinated to the claims of other creditors as determined in such action or proceeding.
Section 7.09 Release of Guarantors. If, in compliance with the terms and provisions of the Loan Documents, all or substantially all of the Equity Interests of any Subsidiary Guarantor are sold or otherwise transferred (a Transferred Guarantor) to a person or persons, none of which is the Borrower or a Guarantor, such Transferred Guarantor shall, effective immediately upon the consummation of such sale or transfer, be automatically released from its obligations under this Agreement (including under Section 10.03 hereof) and its obligations to pledge and grant any Collateral owned by it pursuant to any Security Document and the pledge of such Equity Interests to the Collateral Agent pursuant to the Security Agreements shall be automatically released, and, so long as the Borrower shall have provided the Agents such certifications or documents as any Agent shall reasonably request, the Collateral Agent shall (at the expense of the Borrower) take such actions as are necessary to effect each release described in this Section 7.09 in accordance with the relevant provisions of the Security Documents, so long as the Borrower shall have provided the Agents such certifications or documents as any Agent shall reasonably request in order to demonstrate compliance with this Agreement.
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Section 7.10 Right of Contribution. Each Guarantor hereby agrees that to the extent that such Guarantor shall have paid more than its proportionate share of any payment made hereunder, such Guarantor shall be entitled to seek and receive contribution from and against any other Guarantor hereunder which has not paid its proportionate share of such payment, in an amount not to exceed the highest amount that would be valid and enforceable and not subordinated to the claims of other creditors as determined in any action or proceeding involving any state corporate, limited partnership or limited liability law, or any applicable state, federal or foreign bankruptcy, insolvency, reorganization or other law affecting the rights of creditors generally. Each such Guarantors right of contribution shall be subject to the terms and conditions of Section 7.04. The provisions of this Section 7,10 shall in no respect limit the obligations and liabilities of any Guarantor to the Administrative Agent, the Issuing Bank, and the Lenders, and each Guarantor shall remain liable to the Administrative Agent, the Issuing Bank, and the Lenders for the full amount guaranteed by such Guarantor hereunder.
ARTICLE VIII
EVENTS OF DEFAULT
Section 8.01 Events of Default. For so long as this Agreement remains outstanding, upon the occurrence and during the continuance of the following events (Events of Default):
(a) default shall be made in the payment of any principal of any Loan when and as the same shall become due and payable, whether at the due date thereof (including a Term Loan Repayment Date) or at a date fixed for mandatory prepayment thereof or by acceleration thereof or otherwise;
(b) default shall be made in the payment of any interest on any Loan or any Fee or any other amount (other than an amount referred to in clause (a) above) due under any Loan Document, when and as the same shall become due and payable, and such default shall continue unremedied for a period of five Business Days;
(c) any representation or warranty made or deemed made by or on behalf of any Group Member in any Loan Document, Borrowing Request or LC Request or any representation, warranty, statement or information contained in any certificate furnished by or on behalf of any Group Member pursuant to any Loan Document, shall prove to have been false or misleading in any material respect when so made or deemed made, and such false or misleading representation, warranty, statement or information, to the extent capable of being cured, shall continue to be false, misleading or otherwise unremedied, or shall not be waived, for a period of 30 days after receipt of written notice thereof from the Administrative Agent to the Borrower;
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(d) default shall be made in the due observance or performance by any Group Member of any covenant, condition or agreement contained in Sections 5.02(a) or 5.03(a) (only with respect to legal existence in the Borrowers state of organization), or in Article VI; provided that the failure of Holdings and its Subsidiaries to observe or perform their obligations under Section 6.08 shall not constitute an Event of Default for purposes of any Term Loan unless and until (i) if the Borrower then has the right to receive an Equity Cure Contribution, the date occurs that is fifteen Business Days after the day on which financial statements are required to be delivered for the applicable fiscal quarter pursuant to Section 5.01(a) or (b), as applicable, and (ii) the Required Revolving Lenders have terminated the Commitments and declared the Revolving Loans due and payable (which such Event of Default for purposes of any Term Loans shall terminate automatically and immediately upon the Required Revolving Lenders rescinding such acceleration and/or waiving such Event of Default with respect to the Revolving Loans); provided that if the Lenders with any Incremental Revolving Loan Commitments shall have agreed not to have the benefit of the Financial Covenant, such Incremental Revolving Loan Commitments shall be treated for purposes of this clause (d) in the same manner as Incremental Term Loan Commitments and not as Incremental Revolving Loan Commitments would otherwise be treated for purposes of this clause (d); provided, further, that, for the avoidance of doubt, an Event of Default under this Section 8.01(d) resulting from a breach of Section 6.08 shall be subject to cure pursuant to Section 8.03;
(e) default shall be made in the due observance or performance by any Group Member of any covenant, condition or agreement contained in any Loan Document other than those specified in clauses (a), (b) or (d) immediately above and such default shall continue unremedied or shall not be waived for a period of 30 days after receipt of written notice thereof from the Administrative Agent to the Borrower;
(f) any Credit Party shall fail to (i) pay any principal or interest due in respect of any Indebtedness (other than the Obligations), when and as the same shall become due and payable beyond any applicable grace period, or (ii) observe or perform any other term, covenant, condition or agreement contained in any agreement or instrument evidencing or governing any such Indebtedness, if the effect of any failure referred to in this clause (ii) is to cause, or to permit the holder or holders of such Indebtedness or a trustee or other representative on its or their behalf to cause (with or without the giving of notice, but taking into account any applicable grace periods or waivers), such Indebtedness to become due prior to its stated maturity or become subject to a mandatory offer to purchase by the obligor; provided that this clause (ii) shall not apply to secured Indebtedness that becomes due as a result of the sale, transfer or other disposition (including as a result of a casualty or condemnation event) of the property or assets securing such Indebtedness (to the extent such sale, transfer or other disposition is not prohibited under this Agreement and such Indebtedness is repaid in accordance with its terms); provided, further, that no Event of Default shall occur pursuant to this clause (f) unless the aggregate principal amount of all such Indebtedness referred to in clauses (i) and (ii) exceeds $21,500,000 at any one time (provided that, in the case of Hedging Obligations, the amount counted for this purpose shall be the amount payable by all Credit Parties if such Hedging Obligations were terminated at such time; provided, further, that such failure is unremedied and is not waived by the holders of such Indebtedness);
(g) an involuntary proceeding shall be commenced or an involuntary petition shall be filed in a court of competent jurisdiction seeking (i) relief in respect of any Group Member (other than any Immaterial Subsidiary), or of all or substantially all of the property of any Group Member (other than any Immaterial Subsidiary), under Title 11 of the U.S. Code, as now constituted or hereafter amended, or any other federal, state or foreign bankruptcy,
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insolvency, receivership or similar law; (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for any Group Member (other than any Immaterial Subsidiary) or for all or substantially of the property of any Group Member (other than any Immaterial Subsidiary); or (iii) the winding-up or liquidation of any Group Member (other than any Immaterial Subsidiary); and such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;
(h) any Group Member (other than any Immaterial Subsidiary) shall (i) voluntarily commence any proceeding, or file any petition, seeking relief under Title 11 of the United States Code, as now constituted or hereafter amended, or any other federal, state or foreign bankruptcy, insolvency, receivership or similar law; (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or the filing of any petition described in clause (g) above; (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for any Group Member (other than any Immaterial Subsidiary) or for a substantial part of the property of any Group Member (other than any Immaterial Subsidiary); (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding; (v) make a general assignment for the benefit of creditors; (vi) become unable, admit in writing its inability, or fail generally to, pay its debts as they become due; or (vii) take any corporate (or equivalent) action for the purpose of effecting any of the foregoing;
(i) there is entered against any Credit Party or any Restricted Subsidiary a final judgment or order for the payment of money in an aggregate amount in excess of $21,500,000 (to the extent not covered by independent third-party insurance or a third-party indemnification agreement) and such judgment or order shall not have been satisfied, vacated, discharged or stayed or bonded pending an appeal for a period of 60 consecutive days;
(j) any material provision of any Loan Document, at any time after its execution and delivery and for any reason other than as expressly permitted hereunder or thereunder (including as a result of a transaction permitted under Section 6.04 or Section 6.05) or solely as a result of acts or omissions by the Administrative Agent or any Lender, or the satisfaction in full in cash of all of the Obligations (other than (i) contingent indemnification obligations and unasserted expense reimbursement obligations, (ii) obligations and liabilities under Secured Cash Management Agreements and Secured Hedging Agreements with respect to which arrangements satisfactory to the applicable Cash Management Bank or Hedge Bank shall have been made and (iii) Letters of Credit that have been cash collateralized in accordance with the terms of this Agreement, backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank and termination of the Commitments), ceases to be in full force and effect or, in the case of any Security Document, ceases to create a valid and perfected first priority lien (subject to Permitted Liens) on the Collateral covered thereby; or any material Guarantee for any reason other than as expressly permitted hereunder (including as a result of a transaction permitted under Section 6.04 or Section 6.05) or solely as a result of acts or omissions by the Administrative Agent or any Lender, or the satisfaction in full of all of the Guaranteed Obligations (other than contingent indemnification obligations, unasserted expense reimbursement obligations, obligations and liabilities under Secured Cash Management Agreements and Secured Hedging Agreements with respect to which arrangements satisfactory
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to the applicable Cash Management Bank or Hedge Bank shall have been made, and Letters of Credit that have been cash collateralized in accordance with the terms of this Agreement, backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank and termination of the Commitments), ceases to be in full force and effect; or any Credit Party contests in writing the validity or enforceability of any material provision of any Loan Document or any material Guarantee; or any Credit Party contests in writing the validity or enforceability of any material provision of an Intercreditor Agreement or subordination agreement; or any Credit Party denies in writing that it has any or further liability or obligation under any material provision of any Loan Document or any material Guarantee (in each case, other than as a result of repayment in full in cash of the Obligations (other than contingent indemnification obligations, unasserted expense reimbursement obligations, obligations and liabilities under Secured Cash Management Agreements and Secured Hedging Agreements with respect to which arrangements satisfactory to the applicable Cash Management Bank or Hedge Bank shall have been made, and Letters of Credit that have been cash collateralized in accordance with the terms of this Agreement, backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank) and termination of the Commitments), or purports in writing to revoke or rescind any material portion of any Loan Document, the grant or assignment of any material security interest or any material Guarantee;
(k) there shall have occurred an ERISA Event that, when taken either alone or together with all such other ERISA Events, could reasonably be expected to have a Material Adverse Effect; or
(l) there shall have occurred a Change of Control. then, and in every such event (other than an event with respect to the Borrower described in clause (g) or (h) above), and at any time thereafter during the continuance of such event, the Administrative Agent may, with the prior consent of (x) in the case of an Event of Default subject to the first proviso to Section 8.01(d), the Required Revolving Lenders (subject to the second proviso to Section 8.01(d)) or (y) with respect to any other Event of Default, the Required Lenders, and at the request of (A) in the case of an Event of Default subject to the first proviso to Section 8.01(d), the Required Revolving Lenders (subject to the second proviso to Section 8.01(d)) or (B) in the case of any other Event of Default, the Required Lenders, shall, by notice to the Borrower, take either or both of the following actions, at the same or different times, subject to the terms of any applicable Intercreditor Agreement or subordination agreement: (i) terminate forthwith the Commitments and (ii) declare the Loans and Reimbursement Obligations then outstanding to be forthwith due and payable in whole or in part, whereupon the principal of the Loans and Reimbursement Obligations so declared to be due and payable, together with accrued interest thereon and any unpaid accrued Fees and all other Obligations of the Borrower accrued hereunder and under any other Loan Document, shall become forthwith due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by the Borrower and the Guarantors, anything contained herein or in any other Loan Document to the contrary notwithstanding; and in any event, with respect to the events described in clause (g) or (h) above, the Commitments shall automatically terminate and the principal of the Loans and Reimbursement Obligations then outstanding, together with accrued interest thereon and any unpaid accrued Fees and all other Obligations of the Borrower accrued hereunder and under any other Loan Document, shall automatically become due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by the Borrower and the Guarantors, anything contained herein or in any other Loan Document to the contrary notwithstanding.
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Notwithstanding anything to the contrary contained herein or in any other Loan Document, any Default or Event of Default under this Agreement or similarly defined term under any other Loan Document, other than any Event of Default which cannot be waived without the written consent of each Lender directly and adversely affected thereby, shall be deemed not to exist or be continuing (or other similar expression with respect thereto) if the events, acts or conditions that gave rise to such Default or Event of Default have been remedied or cured (including by payment, notice, taking of any action or omitting to take any action) or have ceased to exist or if such Default or Event of Default shall have been waived.
Section 8.02 Application of Proceeds. Subject to the terms of any applicable Intercreditor Agreement, the proceeds received by the Administrative Agent or the Collateral Agent in respect of any sale of, collection from or other realization upon all or any part of the Collateral or the Guarantees pursuant to the exercise by the Administrative Agent or the Collateral Agent, as the case may be, in accordance with the terms of the Loan Documents, of its remedies shall be applied, in full or in part, together with any other sums then held by the Collateral Agent pursuant to this Agreement, promptly by the Administrative Agent or the Collateral Agent, as the case may be, as follows:
(a) first, to the payment of all reasonable and documented costs and expenses, fees, commissions and taxes of such sale, collection or other realization including compensation to the Administrative Agent, the Collateral Agent and their respective agents and counsel, and all expenses, liabilities and advances made or incurred by the Administrative Agent or the Collateral Agent in connection therewith and all amounts for which the Administrative Agent or the Collateral Agent is entitled to indemnification pursuant to the provisions of any Loan Document, together with interest on each such amount at the highest rate then in effect under this Agreement from and after the date such amount is due, owing and unpaid until paid in full;
(b) second, to the payment of all other reasonable and documented costs and expenses of such sale, collection or other realization including compensation to the other Secured Parties and their agents and counsel and all costs, liabilities and advances made or incurred by the other Secured Parties in connection therewith, together with interest on each such amount at the highest rate then in effect under this Agreement from and after the date such amount is due, owing and unpaid until paid in full;
(c) third, without duplication of amounts applied pursuant to clauses (a) and (b) above, to the payment in full in cash, pro rata, of interest and other amounts constituting Obligations (other than principal any premium thereon, Reimbursement Obligations and obligations to cash collateralize Letters of Credit) and any fees, premiums and scheduled periodic payments due under Cash Management Agreements and Hedging Agreements constituting Secured Obligations and any interest accrued thereon, in each case equally and ratably in accordance with the respective amounts thereof then due and owing;
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(d) fourth, to the payment in full in cash, pro rata, of the principal amount of the Obligations and any premium thereon (including Reimbursement Obligations and obligations to cash collateralize Letters of Credit) and any breakage, termination or other payments under Cash Management Agreements and Hedging Agreements constituting Secured Obligations and any interest accrued thereon; and
(e) fifth, the balance, if any, to the person lawfully entitled thereto (including the applicable Credit Party or its successors or assigns) or as a court of competent jurisdiction may direct.
In the event that any such proceeds are insufficient to pay in full the items described in the preceding sentences of this Section 8.02, the Credit Parties shall remain liable, jointly and severally, for any deficiency. For the avoidance of doubt, notwithstanding any other provision of any Loan Document, no amount received directly or indirectly from any Credit Party that is not a Qualified ECP Guarantor shall be applied directly or indirectly by the Administrative Agent or otherwise to the payment of any Excluded Swap Obligations, and Obligations arising under Secured Cash Management Agreements and Secured Hedging Agreements shall be excluded from the application described above in clauses (a) through (e) of the first sentence of this Section 8.02 if the Administrative Agent has not received written notice thereof, together with such supporting documentation from the applicable Cash Management Bank or Hedge Bank, as the case may be, as may be reasonably necessary to determine the amount of the Obligations owed thereunder. Each Cash Management Bank or Hedge Bank not a party to this Agreement that has given the notice contemplated by the preceding sentence shall, by such notice, be deemed to have acknowledged and accepted the appointment of the Administrative Agent and the Collateral Agent pursuant to the terms of Article IX hereof for itself and its Affiliates as if a Lender party hereto and be deemed to be (and agrees to be) subject to the provisions in Sections 10.09, 10.10 and 10.12 as a party hereto.
Section 8.03 Equity Cure.
(a) Notwithstanding anything to the contrary contained in Section 8.01, but subject to Section 8.03(b), solely for the purpose of determining whether an Event of Default has occurred under the financial covenant set forth in Section 6.08 (the Financial Covenant) as of the end of and for any Test Period ending on the last day of any fiscal quarter (such fiscal quarter, a Cure Quarter), the then existing direct or indirect equity holders of Holdings shall have the right to make an equity investment or shareholder loan (to the extent such shareholder loan is subject to the terms and provisions of the Subordination Agreement in all respects), directly or indirectly, (which equity contribution shall not be Disqualified Capital Stock) in Holdings in cash, which Holdings shall contribute, directly or indirectly, to the Borrower in cash (which equity contribution shall not be Disqualified Capital Stock) on or after the first day of such Cure Quarter and on or prior to the fifteenth Business Day after the date on which financial statements are required to be delivered pursuant to Section 5.01(a) or (b), as applicable, with respect to such Cure Quarter or the fiscal year ending on the last day of such Cure Quarter, as applicable (the Cure Expiration Date), and such cash will, together with any Eligible Equity Issuances which have been included in clause (c) of the Cumulative Amount (to the extent Not Otherwise Applied), in each case, if so designated by Holdings, be included in the calculation of Consolidated EBITDA for purposes of determining compliance with the Financial Covenant as
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of the end of and for the Test Period ending on the last day of such Cure Quarter and any Test Periods ending on the last day of any of the subsequent three fiscal quarters (any such equity contribution so included in the calculation of Consolidated EBITDA, an Equity Cure Contribution, and the amount of such Equity Cure Contribution, the Cure Amount); provided that such Equity Cure Contribution is Not Otherwise Applied (other than, for the avoidance of doubt pursuant to this Section 8.03(a)). All Equity Cure Contributions shall be disregarded for all purposes of this Agreement other than inclusion in the calculation of Consolidated EBITDA for the purpose of determining compliance with the Financial Covenant as of the end of and for the Test Period ending on the last day of such Cure Quarter and any Test Periods ending on the last day of any of the subsequent three fiscal quarters, including being disregarded for purposes of the determination of the Cumulative Amount and all components thereof and any baskets or other ratios with respect to the covenants contained in Article VI (other than Section 6.08). There shall be no pro forma reduction in Consolidated Total Funded Indebtedness (by netting or otherwise) with the proceeds of any Equity Cure Contribution for determining compliance with the Financial Covenant under Section 6.08 as of and for the Test Period ending on the last day of the Cure Quarter; provided that such Equity Cure Contribution shall reduce Consolidated Total Funded Indebtedness in future fiscal quarters to the extent used to prepay any applicable Indebtedness. Notwithstanding anything to the contrary contained in Section 8.01, (A) upon receipt of the Cure Amount by Holdings (and the subsequent contribution in cash to the Borrower (which equity contribution shall not be Disqualified Capital Stock in the Borrower)) in at least the amount necessary to cause the Borrower to be in compliance with the Financial Covenant as of the end of and for the Test Period ending on the last day of such Cure Quarter, the Financial Covenant under Section 6.08 shall be deemed satisfied and complied with as of the end of and for such Test Period with the same effect as though there had been no failure to comply with the Financial Covenant under Section 6.08, and any Default or Event of Default related to any failure to comply with the Financial Covenant shall be deemed not to have occurred for purposes of the Loan Documents, and (B) upon receipt by the Administrative Agent of a notice from the Borrower (Notice of Intent to Cure) and through the Cure Expiration Date: (i) no Default or Event of Default shall be deemed to have occurred on the basis of any failure to comply with the Financial Covenant unless such failure is not cured by the making of an Equity Cure Contribution on or prior to the Cure Expiration Date, (ii) the Borrower shall not be permitted to borrow Revolving Loans or Swing Line Loans and Letters of Credit shall not be issued or renewed unless and until the Equity Cure Contribution is made or all existing Events of Default are waived or cured, (iii) none of the Administrative Agent, the Collateral Agent or any Lender shall exercise any of the remedial rights otherwise available to it upon an Event of Default, including the right to accelerate the Loans, to terminate Commitments or to foreclose on the Collateral solely on the basis of an Event of Default having occurred as a result of a violation of Section 6.08, unless the Equity Cure Contribution is not made on or before the Cure Expiration Date and (iv) if the Equity Cure Contribution is not made on or before the Cure Expiration Date, such Event of Default or potential Event of Default shall spring into existence after such time and the Administrative Agent, the Collateral Agent and any Lender may take any actions or remedies pursuant to this Agreement and the other Loan Documents.
(b) There shall be no more than five Equity Cure Contributions made during the term of this Agreement and no more than two Equity Cure Contributions made during any four consecutive fiscal quarters. No Equity Cure Contribution shall be any greater than the minimum amount required for the Borrower to be in compliance with the Financial Covenant in the applicable Cure Quarter including, without limitation, for purposes of calculating any amounts to be added back to Consolidated EBITDA pursuant to clause (o) of the definition thereof.
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ARTICLE IX
THE ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT
Section 9.01 Appointment and Authority.
(a) Each of the Lenders and the Issuing Bank hereby irrevocably appoints GS to act on its behalf as the Administrative Agent hereunder and under the other Loan Documents and irrevocably authorizes the Administrative Agent (including through its agents or employees) to take such actions on its behalf, including execution of the other Loan Documents, and to exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto. The provisions of this Article are solely for the benefit of the Administrative Agent, the Lenders and the Issuing Bank, and neither the Borrower nor any other Credit Party shall have rights as a third party beneficiary of any of such provisions (except for the provisions in Sections 9,01, 9,06 and 9,10). It is understood and agreed that the use of the term agent herein or in any other Loan Documents (or any other similar term) with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable Requirements of Law. Instead such term is used as a matter of market custom, and is intended to create or reflect only an administrative relationship between contracting parties.
(b) The Administrative Agent shall also act as the collateral agent under the Loan Documents, and each of the Lenders (including (for all purposes of this paragraph) in its capacities as a potential or actual counterparty to Hedging Agreements and a potential Cash Management Bank) and the Issuing Bank hereby irrevocably appoints and authorizes the Administrative Agent to act as the agent of such Lender and the Issuing Bank for purposes of acquiring, holding and enforcing any and all Liens on Collateral granted by any of the Credit Parties to secure any of the Obligations, together with such powers and discretion as are reasonably incidental thereto and such Lender and the Issuing Bank acknowledge and agree that the Administrative Agent may also act, subject to and in accordance with the terms of any applicable Intercreditor Agreement as the collateral agent for the lenders and other secured parties under any documents evidencing Indebtedness permitted hereunder secured on a junior basis to the Secured Obligations. In this connection, the Administrative Agent, as collateral agent, and any co-agents, sub-agents and attorneys-in-fact appointed by the Administrative Agent pursuant to Section 9,05 for purposes of holding or enforcing any Lien on the Collateral (or any portion thereof) granted under the Security Documents, or for exercising any rights and remedies thereunder at the direction of the Administrative Agent, shall be entitled to the benefits of all provisions of this Article IX and Article X (including Section 10.03) (in the case of co-agents, sub-agents and attorneys-in-fact, as though such co-agents, sub-agents and attorneys-in-fact were the collateral agent under the Loan Documents) as if set forth in full herein with respect thereto. Any entity holding Collateral for and on behalf of the Administrative Agent in its role as collateral agent shall be deemed to be appointed as a sub-agent of the Administrative Agent in accordance with the provisions of Section 9,05.
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Section 9.02 Rights as a Lender. At any time that such Person is also a Lender hereunder, the Person serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent, and the term Lender or Lenders shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as the Administrative Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, own securities of, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not the Administrative Agent hereunder and without any duty to account therefor to the Lenders.
Section 9.03 Exculpatory Provisions.
(a) The Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents, and its duties hereunder shall be administrative in nature. Without limiting the generality of the foregoing, the Administrative Agent:
(i) shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing (and it is understood and agreed that the use of the term agent herein or in any other Loan Documents (or any other similar term) with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable law, and that such term is used as a matter of market custom and is intended to create or reflect only an administrative relationship between contracting parties);
(ii) shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith to be necessary, under the circumstances as provided for herein or in the other Loan Documents); provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable Requirements of Law, including for the avoidance of doubt any action that may be in violation of the automatic stay under any Debtor Relief Law or that may effect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any Debtor Relief Law; and
(iii) shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to Holdings, the Borrower or any of their respective Affiliates that is communicated to or obtained by the Person serving as the Administrative Agent or any of its Affiliates in any capacity.
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(b) The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances) or (ii) in the absence of its own gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and nonappealable judgment. The Administrative Agent shall be deemed not to have knowledge of any Default unless and until notice describing such Default (and identifying it as such) is given in writing to the Administrative Agent by the Borrower, a Lender or an Issuing Bank.
(c) The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith,
(i) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default or Event of Default,
(ii) the sufficiency, validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document, or the creation, perfection or priority of any Lien purported to be created by the Security Documents, (v) the value or the sufficiency of any Collateral or that the Liens granted to the Collateral Agent pursuant to the Loan Documents have been properly or sufficiently or lawfully created, perfected, protected or enforced or are entitled to any particular priority, or (vi) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.
Section 9.04 Reliance by Administrative Agent. The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person (whether or not such Person in fact meets the requirements set forth in the Loan Documents for being the signatory, sender or authenticator thereof). The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person (whether or not such Person in fact meets the requirements set forth in the Loan Documents for being the signatory, sender or authenticator thereof), and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Loan, or the issuance, extension, renewal or increase of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or the Issuing Bank, the Administrative Agent may presume that such condition is satisfactory to such Lender or the Issuing Bank unless the Administrative Agent shall have received notice to the contrary from such Lender or the Issuing Bank prior to the making of such Loan or the issuance of such Letter of Credit. The Administrative Agent may consult with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.
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Section 9.05 Delegation of Duties. The Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through, or delegate any and all such rights and powers to, any one or more coagents, sub-agents or attorneys-in-fact appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. The exculpatory and indemnification provisions of this Article IX and Article X shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and shall apply, without limiting the foregoing, to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Administrative Agent. The Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents except to the extent that a court of competent jurisdiction determines in a final and non-appealable judgment that the Administrative Agent acted with gross negligence, bad faith or willful misconduct in the selection of such sub-agents.
Section 9.06 Resignation of Administrative Agent.
(a) The Administrative Agent may at any time give notice of its resignation to the Lenders, the Issuing Bank and the Borrower and such notice shall also be effective in respect of its role as Collateral Agent unless the Administrative Agent otherwise agrees in writing; provided, that any such notice provided by the Administrative Agent shall provide for at least ten days prior notice to such persons of such resignation unless the Borrower expressly consents to a shorter notice period in its sole discretion. If the Lender acting as Administrative Agent is, or the Administrative Agent is an Affiliate of a Lender that is, replaced pursuant to Section 2.16(b), then such Lender or such Administrative Agent, as applicable, shall be deemed to have submitted its notice of resignation as Administrative Agent concurrent with such replacement (and, for the avoidance of doubt, the Borrower shall be deemed to have waived the notice period required pursuant to this Section 9,06). Upon receipt of any such notice of resignation, the Required Lenders shall have the right, with the Borrowers consent (absent an Event of Default under Section 8.01(a), (b), (g) (with respect to the Borrower only), or (h) (with respect to the Borrower only)) (such consent not to be unreasonably withheld or delayed), to appoint a successor that is not a Disqualified Institution, which shall be a commercial bank or trust company with an office in the United States, or an Affiliate of any such commercial bank or trust company with an office in the United States having capital and surplus aggregating in excess of $1,000,000,000, with any prohibited appointment to be absolutely void ab initio. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation (or such earlier day as shall be agreed by the Required Lenders) (the Resignation Effective Date), then the retiring Administrative Agent may (but shall not be obligated to) on behalf of the Lenders and the Issuing Bank, appoint a successor Administrative Agent meeting the qualifications set forth above (including the Borrowers consent and that such successor not be a Disqualified Institution), with any prohibited appointment to be absolutely void ab initio. Whether or not a successor has been appointed, such resignation shall become effective in accordance with such notice on the Resignation Effective Date.
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(b) With effect from the Resignation Effective Date, (1) the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case of any collateral security granted to or held by the Administrative Agent on behalf of the Lenders or the Issuing Bank under any of the Loan Documents, the retiring Administrative Agent shall continue to hold such collateral security until such time as a successor Administrative Agent is appointed), and (2) except for any indemnity payments or other amounts then owed to the retiring Administrative Agent, all payments, communications and determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender and the Issuing Bank directly, until such time, if any, as the Required Lenders or the resigning Administrative Agent appoint a successor Administrative Agent as provided for above. Upon the acceptance of a successors appointment as Administrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring Administrative Agent (other than as provided in Section 2.15 and other than any rights to indemnity payments or other amounts owed to the retiring Administrative Agent as of the Resignation Effective Date), and the retiring Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this Section). The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the retiring Administrative Agents resignation hereunder and under the other Loan Documents, the provisions of this Article IX and Section 10.03 shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Administrative Agent was acting as Administrative Agent.
(c) Any resignation by GS as Administrative Agent pursuant to this Section shall also constitute its resignation as an Issuing Bank and Swing Line Lender. If any Issuing Bank resigns as an Issuing Bank, it shall retain all the rights, powers, privileges and duties of the Issuing Bank hereunder with respect to all Letters of Credit outstanding as of the effective date of its resignation as Issuing Bank and all LC Obligations with respect thereto, including the right to require the Lenders to make ABR Loans or fund risk participations in outstanding Reimbursement Obligations pursuant to Section 2.18(e). If GS resigns as Swing Line Lender, it shall retain all the rights of the Swing Line Lender provided for hereunder with respect to Swing Line Loans made by it and outstanding as of the effective date of such resignation, including the right to require the Lenders to make ABR Loans or fund risk participations in outstanding Swing Line Loans pursuant to Section 2.17. Upon the appointment by the Borrower of a successor Issuing Bank or Swing Line Lender hereunder (which successor shall in all cases be a Lender other than a Defaulting Lender), (a) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring Issuing Bank and/or Swing Line Lender, as applicable, (b) the retiring Issuing Bank and Swing Line Lender shall be discharged from all of their respective duties and obligations hereunder or under the other Loan Documents, and (c) the successor Issuing Bank shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements reasonably satisfactory to the Issuing Bank that issued such outstanding Letters of Credit to effectively assume the obligations of the Issuing Bank that issued such outstanding Letters of Credit with respect to such Letters of Credit.
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Section 9.07 Non-Reliance on Administrative Agent and Other Lenders. Each Lender and the Issuing Bank acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, conducted its own independent investigation of the financial condition and affairs of the Credit Parties and their Subsidiaries and made its own credit analysis and decision to enter into this Agreement. Each Lender further represents and warrants that it has reviewed each document made available to it on the Platform in connection with this Agreement and has acknowledged and accepted the terms and conditions applicable to the recipients thereof (including any such terms and conditions set forth, or otherwise maintained, on the Platform with respect thereto). Each Lender and the Issuing Bank also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder. Each Lender and the Issuing Bank expressly acknowledge that the Administrative Agent and its Affiliates have not made any representation or warranty to it. Except for documents expressly required by the Loan Documents to be transmitted by the Administrative Agent to the Lenders or the Issuing Bank, the Administrative Agent shall have no duty or responsibility (either express or implied) to provide any Lender or the Issuing Bank with any credit or other information concerning any Credit Party, including the business, prospects, operations, property, financial and other condition or creditworthiness of any Credit Party or any Affiliate of a Credit Party, that may come into the possession of the Administrative Agent or any of its Affiliates.
Section 9.08 No Other Duties, Etc. Anything herein to the contrary notwithstanding, none of the Lead Arrangers or the Agents listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent, the Collateral Agent, a Lender or the Issuing Bank hereunder.
Section 9.09 Administrative Agent May File Proofs of Claim; Credit Bidding. In case of the pendency of any proceeding under any Debtor Relief Law or any other judicial proceeding relative to any Credit Party, the Administrative Agent (irrespective of whether the principal of any Loan or LC Obligation shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered (but not obligated), by intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, LC Obligations and all other Obligations that are owing and unpaid and to file such other documents as may be reasonably necessary or advisable in order to have the claims of the Lenders, the Issuing Bank and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders, the Issuing Bank and the Administrative Agent and their respective agents and counsel and all other amounts due to the Lenders, the Issuing Bank and the Administrative Agent under Sections 2,05 and 10.03 or otherwise) allowed in such judicial proceeding; and
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(b) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender and the Issuing Bank to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders and the Issuing Bank, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Sections 2,05 and 10.03.
Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender or the Issuing Bank any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or the Issuing Bank or to authorize the Administrative Agent to vote in respect of the claim of any Lender or the Issuing Bank in any such proceeding.
The Secured Parties hereby irrevocably authorize the Administrative Agent, at the direction of the Required Lenders, to credit bid all or any portion of the Obligations (including accepting some or all of the Collateral in satisfaction of some or all of the Secured Obligations pursuant to a deed in lieu of foreclosure or otherwise) and in such manner purchase (either directly or through one or more acquisition vehicles) all or any portion of the Collateral (a) at any sale thereof conducted under the provisions of the Bankruptcy Code, including under Sections 363, 1123 or 1129 of the Bankruptcy Code, or any similar Requirements of Law in any other jurisdictions to which a Credit Party is subject or (b) at any other sale or foreclosure or acceptance of collateral in lieu of debt conducted by (or with the consent or at the direction of) the Administrative Agent (whether by judicial action or otherwise) in accordance with any applicable Requirements of Law. In connection with any such credit bid and purchase, the Obligations owed to the Secured Parties shall be entitled to be, and shall be, credit bid on a ratable basis (with Obligations with respect to contingent or unliquidated claims receiving contingent interests in the acquired assets on a ratable basis that would vest upon the liquidation of such claims in an amount proportional to the liquidated portion of the contingent claim amount used in allocating the contingent interests) in the asset or assets so purchased (or in the Equity Interests or debt instruments of the acquisition vehicle or vehicles that are used to consummate such purchase). In connection with any such bid, (i) the Administrative Agent shall be authorized to form one or more acquisition vehicles to make a bid, (ii) the Administrative Agent shall be authorized to adopt documents providing for the governance of the acquisition vehicle or vehicles (provided that any actions by the Administrative Agent with respect to such acquisition vehicle or vehicles, including any disposition of the assets or Equity Interests thereof, shall be governed, directly or indirectly, by the vote of the Required Lenders, irrespective of the termination of this Agreement and without giving effect to the limitations on actions by the Required Lenders contained in clauses (i) through (xi) of the first proviso to Section 10.02(b) of this Agreement, (iii) the Administrative Agent shall be authorized to assign the relevant Obligations to any such acquisition vehicle pro rata by the Lenders, as a result of which each of the Lenders shall be deemed to have received a pro rata portion of any Equity Interests and/or debt instruments issued by such an acquisition vehicle on account of the assignment of the Obligations to be credit bid, all without the need for any Secured Party or acquisition vehicle to take any further action, and (iv) to the extent that Obligations that are assigned to an acquisition
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vehicle are not used to acquire Collateral for any reason (as a result of another bid being higher or better, because the amount of Obligations assigned to the acquisition vehicle exceeds the amount of debt credit bid by the acquisition vehicle or otherwise), such Obligations shall automatically be reassigned to the Lenders pro rata, and the Equity Interests and/or debt instruments issued by any acquisition vehicle on account of such Obligations that had been assigned to the acquisition vehicle shall automatically be cancelled, without the need for any Secured Party or any acquisition vehicle to take any further action.
Section 9.10 Collateral and Guarantee Matters. Each of the Lenders (including in its capacities as an actual or potential secured counterparty to a Hedging Agreement or as a Cash Management Bank) and the Issuing Bank irrevocably authorize the Administrative Agent and Collateral Agent, at their option and in their discretion:
(a) to release any Lien on any property granted to or held by the Administrative Agent or Collateral Agent under any Loan Document (i) upon termination of the Commitments of the Lenders under this Agreement and payment in full of all Secured Obligations (other than (A) contingent indemnification obligations and unasserted expense reimbursement obligations and (B) obligations and liabilities under Secured Cash Management Agreements and Secured Hedging Agreements as to which arrangements satisfactory to the applicable Cash Management Bank or Hedge Bank shall have been made) and the expiration or termination of all Letters of Credit (other than Letters of Credit that have been cash collateralized in accordance with the terms of this Agreement, backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank), (ii) that is sold or otherwise disposed of (other than to a Credit Party) or (A) to be sold or otherwise disposed of as part of or (B) in connection with any conveyance, sale, transfer or other disposition permitted hereunder or under any other Loan Document or so that a Lien may be granted (or continue to subsist) over such property as permitted by (and subject to any conditions in) Section 6.02(c), (d), (f), (i), (k), (1), (m), (s), (t), (u), (w), (x), (z), (bb), (cc) and (dd), (iii) in connection with the designation of any Restricted Subsidiary as an Unrestricted Subsidiary or (iv) subject to Section 10.02, if approved, authorized or ratified in writing by the Required Lenders;
(b) to subordinate any Lien on any property granted to or held by the Administrative Agent or Collateral Agent under any Loan Document to the holder of any Lien on such property that is expressly permitted to be senior to the Liens securing the Secured Obligations pursuant to Section 6.02;
(c) to release any Guarantor from its obligations under its Guarantee if such Person ceases to be a Restricted Subsidiary as a result of a transaction permitted under the Loan Documents; and
(d) to enter into any Intercreditor Agreement or any other intercreditor or subordination agreement it deems reasonable (or, in each case, any amendment or modification thereto or restatement thereof) in connection with any refinancing facilities or notes (including, without limitation, Permitted Pari Passu Refinancing Debt, Permitted Junior Refinancing Debt and Permitted Unsecured Refinancing Debt), Incremental Facilities, Permitted Incremental Equivalent Debt or other obligations not prohibited hereunder and that if any such Intercreditor
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Agreement or other intercreditor or subordination agreement (or, in each case, any such amendment or modification thereto or restatement thereof) is posted to the Lenders three Business Days before being executed and the Required Lenders shall not have objected to such Intercreditor Agreement or other intercreditor or subordination agreement (or, in each case, any such amendment or modification thereto or restatement thereof) the Required Lenders shall be deemed to have agreed that the Administrative Agents or the Collateral Agents entry into such Intercreditor Agreement or other intercreditor or subordination agreement is reasonable and to have consented to such Intercreditor Agreement or other intercreditor or subordination agreement (or, in each case, any such amendment or modification thereto or restatement thereof) and such Agents execution thereof.
Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the Administrative Agents authority to release or subordinate its interest in particular types or items of property, or to release any Guarantor from its obligations under its Guarantee pursuant to this Section 9,10. In each case as specified in this Section 9,10, the Administrative Agent will, at the Borrowers expense, execute and deliver to the applicable Credit Party such documents as such Credit Party may reasonably request to evidence the release of any such item of Collateral from the assignment and security interest granted under the Security Documents or to subordinate its interest in any such item, or to release any such Guarantor from its obligations under its Guarantee, in each case in accordance with the terms of the Loan Documents and this Section 9,10.
The Administrative Agent shall not be responsible for or have a duty to ascertain or inquire into any representation or warranty regarding the existence, value or collectability of the Collateral, the existence, priority or perfection of the Administrative Agents Lien thereon, or any certificate prepared by any Credit Party in connection therewith, nor shall the Administrative Agent be responsible or liable to the Lenders for any failure to monitor or maintain any portion of the Collateral.
Section 9.11 Secured Cash Management Agreements and Secured Hedging Agreements. Except as otherwise expressly set forth herein, no Cash Management Bank or Hedge Bank that obtains the benefits of the Loan Documents, any Guarantee or any Collateral by virtue of the provisions hereof or any Security Document shall have any right to notice of any action or to consent to or direct or object to any action hereunder or under any other Loan Document or otherwise in respect of the Collateral (including the release or impairment of any Collateral) other than (x) if applicable, in its capacity as a Lender and, in such case, only to the extent expressly provided in the Loan Documents or (y) pursuant to any Intercreditor Agreement. Notwithstanding any other provision of this Section 9,11 to the contrary, the Administrative Agent shall not be required to verify the payment of, or that other satisfactory arrangements have been made with respect to, Secured Obligations arising under Secured Cash Management Agreements unless the Administrative Agent has received written notice of such Secured Obligations, together with such supporting documentation as the Administrative Agent may request, from the applicable Cash Management Bank, as the case may be.
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Section 9.12 Withholding Tax. To the extent required by any applicable Requirements of Law (including for this purpose, pursuant to any agreements entered into with a Governmental Authority), the Agents may withhold from any payment to any Lender an amount equivalent to any applicable withholding Tax. If the IRS or any other authority of the United States or other Governmental Authority asserts a claim that an Agent did not properly withhold Tax from any amounts paid to or for the account of any Lender for any reason (including, without limitation, because the appropriate form was not delivered or not properly executed, or because such Lender failed to notify the Agent of a change in circumstance that rendered the exemption from, or reduction of, withholding Tax ineffective), such Lender shall indemnify and hold harmless the Agent (to the extent that the Agent has not already been reimbursed by the Credit Parties and without limiting the obligation of the Credit Parties to do so) and shall make payable in respect thereof within 10 days after demand therefor, for all amounts paid, directly or indirectly, by the Agent as Tax or otherwise, including any interest, additions to Tax or penalties thereto, together with all expenses incurred, including legal expenses and any other out-of-pocket expenses, whether or not such Tax was correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by an Agent shall be deemed presumptively correct absent manifest error. Each Lender hereby authorizes each Agent to set off and apply any and all amounts at any time owing to such Lender under this Agreement or any other Loan Document against any amount due the Agents under this Section 9,12. The agreements in this Section 9,12 shall survive the resignation and/or replacement of an Agent, any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all other Obligations. Unless required by applicable laws, at no time shall any Agent have any obligation to file for or otherwise pursue on behalf of a Lender any refund of Taxes withheld or deducted from funds paid to or for the account of such Lender. For the avoidance of doubt, for the purposes of this Section 9,12, the term Lender shall include the Swing Line Lender and the Issuing Bank.
Section 9.13 Certain ERISA Matters.
(a) Each Lender (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent and the Lead Arrangers and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Credit Party, that at least one of the following is and will be true:
(i) such Lender is not using plan assets (within the meaning of 29 CFR § 2510.3-101, as modified by Section 3(42) of ERISA) of one or more Benefit Plans in connection with the Loans, the Letters of Credit or the Commitments,
(ii) the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain transactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involving insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective investment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), is applicable, and the conditions of such exemption have been satisfied, with respect to such Lenders entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement,
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(iii) (A) such Lender is an investment fund managed by a Qualified Professional Asset Manager (within the meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such Lender to enter into, participate in, administer and perform the Loans, the Letters of Credit, the Commitments and this Agreement, and (C) the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement satisfies the requirements of sub-sections (a) through (g) of Part I of PTE 84-14, or
(iv) such other representation, warranty and covenant as may be agreed in writing between the Administrative Agent, in its sole discretion, and such Lender.
(b) In addition, unless sub-clause (i) in the immediately preceding clause (a) is true with respect to a Lender or such Lender has not provided another representation, warranty and covenant as provided in sub-clause (iv) in the immediately preceding clause (a), such Lender further (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent and the Lead Arrangers and their respective Affiliates, and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Credit Party, that:
(i) none of the Administrative Agent and the Lead Arrangers or any of their respective Affiliates is a fiduciary with respect to the assets of such Lender (including in connection with the reservation or exercise of any rights by the Administrative Agent under this Agreement, any Loan Document or any documents related to hereto or thereto),
(ii) the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement is independent (within the meaning of 29 CFR § 2510.3-21) and is a bank, an insurance carrier, an investment adviser, a broker-dealer or other person that holds, or has under management or control, total assets of at least $50 million, in each case as described in 29 CFR § 2510.3-21(c)(l)(i)(A)-(E),
(iii) the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement is capable of evaluating investment risks independently, both in general and with regard to particular transactions and investment strategies (including in respect of the Obligations),
(iv) the Person making the investment decision on behalf of such Lender with respect to the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement is a fiduciary under ERISA or the Code, or both, with respect to the Loans, the Letters of Credit, the Commitments and this Agreement and is responsible for exercising independent judgment in evaluating the transactions hereunder, and
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(v) no fee or other compensation is being paid directly to the Administrative Agent and the Lead Arrangers or any their respective Affiliates for investment advice (as opposed to other services) in connection with the Loans, the Letters of Credit, the Commitments or this Agreement.
(c) The Administrative Agent and each of the Lead Arrangers hereby informs the Lenders that each such Person is not undertaking to provide impartial investment advice, or to give advice in a fiduciary capacity, in connection with the transactions contemplated hereby, and that such Person has a financial interest in the transactions contemplated hereby in that such Person or an Affiliate thereof (i) may receive interest or other payments with respect to the Loans, the Letters of Credit, the Commitments and this Agreement, (ii) may recognize a gain if it extended the Loans, the Letters of Credit or the Commitments for an amount less than the amount being paid for an interest in the Loans, the Letters of Credit or the Commitments by such Lender or (iii) may receive fees or other payments in connection with the transactions contemplated hereby, the Loan Documents or otherwise, including structuring fees, commitment fees, arrangement fees, facility fees, upfront fees, underwriting fees, ticking fees, agency fees, administrative agent or collateral agent fees, utilization fees, minimum usage fees, letter of credit fees, fronting fees, deal-away or alternate transaction fees, amendment fees, processing fees, term out premiums, bankers acceptance fees, breakage or other early termination fees or fees similar to the foregoing.
ARTICLE X
MISCELLANEOUS
Section 10.01 Notices.
(a) Generally. Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in clause (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopier or electronic mail as follows:
if to any Credit Party, to the Borrower at:
Cvent, Inc.
1765 Greensboro Station Place, 7th Floor
Tysons Corner, VA 22102
Attn: Cynthia Russo, EVP, Chief Financial Officer
E-mail: [***]
Attn: Billy Newman, VP, Financial Planning & Analysis
E-mail: [***]
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with a copy to (which shall not constitute notice):
Vista Equity Partners Fund VI, L.P.
c/o Vista Equity Partners Management, LLC
Four Embarcadero Center, 20th Floor
San Francisco, CA 94111
Attention: David Breach and Monti Saroya
Email: [***]
[***]
and (which shall not constitute notice):
Kirkland & Ellis LLP
555 California Street, Suite 2700
San Francisco, CA 94104
Attention: Sonali Jindal
Email: [***]
if to the Sponsor to it at:
Vista Equity Partners Fund VI, L.P.
c/o Vista Equity Partners Management, LLC
Four Embarcadero Center, 20th Floor
San Francisco, CA 94111
Attention: David Breach and Monti Saroya
Email: [***]
[***]
if to the Administrative Agent or the Collateral Agent at:
Goldman Sachs Bank USA
200 West Street, 16th Floor
New York, NY 10282
Attention: SBD Operations
Fax: (212) 428-9270
Email for Borrowing Requests and Interest Election Requests:
[***]
Email for other notices and financial statement deliveries:
[***]
[***]
if to GS in its capacity as the Issuing Bank to it at:
Goldman Sachs Bank USA
c/o Goldman Sachs Loan Operations
Attn: Letter of Credit Department Manager
6011 Connection Drive
Irving, TX 75039
Fax: (917) 977-4587
Phone: (972) 368-2790
Email: [***]
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if to GS in its capacity as the Swing Line Lender to it at:
Goldman Sachs Bank USA
200 West Street, 16th Floor
New York, NY 10282
Attention: SBD Operations Fax: (212) 428-9270
Email: [***]
if to a Lender, to it at its address (or telecopier number) set forth in its Administrative Questionnaire.
Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, they shall be deemed to have been given at the opening of business on the next Business Day for the recipient). Notices delivered through electronic communications to the extent provided in clause (b) below, shall be effective as provided in said clause (b).
(b) Electronic Communications. Notices and other communications to the Lenders and the Issuing Bank hereunder may (subject to Section 10.01(d)) be delivered or furnished by electronic communication (including electronic mail, FpML messaging, Internet or intranet websites) pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices to any Lender pursuant to Article II if such Lender has notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication. The Administrative Agent, the Collateral Agent, the Issuing Bank or the Borrower may agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it (including as set forth in Section 10.01(d)); provided that approval of such procedures may be limited to particular notices or communications.
Unless the Administrative Agent otherwise prescribes, notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its electronic mail address as described in the foregoing clause (b) of notification that such notice or communication is available and identifying the website address therefor.
(c) Change of Address, etc. Any party hereto may change its address or telecopier number or electronic mail address for notices and other communications hereunder by written notice to the other parties hereto.
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(d) Posting. Each Credit Party hereby agrees that it will provide to the Administrative Agent all information, documents and other materials that it is obligated to furnish to the Administrative Agent pursuant to this Agreement and any other Loan Document, including all notices, requests, financial statements, financial and other reports, certificates and other information materials, but excluding any such communication (unless otherwise approved in writing by the Administrative Agent) that (i) relates to a request for a new, or a conversion of an existing, Borrowing or other extension of credit (including any election of an interest rate or interest period relating thereto), (ii) relates to the payment of any principal or other amount due under this Agreement prior to the scheduled date therefor, (iii) provides a Notice of Intent to Cure, (iv) provides notice of any Default under this Agreement or (v) is required to be delivered to satisfy any condition precedent to the effectiveness of this Agreement and/or any borrowing or other extension of credit hereunder (all such non-excluded communications, collectively, the Communications), by transmitting the Communications in an electronic/soft medium in a format reasonably acceptable to the Administrative Agent at such e-mail address(es) provided to the Borrower from time to time or in such other form, including hard copy delivery thereof, as the Administrative Agent shall require. In addition, each Credit Party agrees to continue to provide the Communications to the Administrative Agent in the manner specified in this Agreement or any other Loan Document or in such other form, including hard copy delivery thereof, as the Administrative Agent shall reasonably request. Nothing in this Section 10.01 shall prejudice the right of the Agents, any Lender or any Credit Party to give any notice or other communication pursuant to this Agreement or any other Loan Document in any other manner specified in this Agreement or any other Loan Document or as any such Agent shall require.
(e) Platform. Each Credit Party further agrees that any Agent or Lead Arranger may make the Communications available to the Lenders by posting the Communications on IntraLinks, ClearPar, Debt Domain or SyndTrak or a substantially similar secure electronic transmission system (the Platform). The Platform is provided as is and as available. The Agents and Lead Arrangers do not warrant the accuracy or completeness of the Communications or the adequacy of the Platform and expressly disclaim liability for errors or omissions in the communications. No warranty of any kind, express, implied or statutory, including, without limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third party rights or freedom from viruses or other code defects, is made by any Agent or Lead Arranger in connection with the Communications or the Platform. In no event shall any Agent or Lead Arranger or any of their Related Parties have any liability to the Credit Parties, any Lender or any other person for damages of any kind, including direct or indirect, special, incidental or consequential damages, losses or expenses (whether in tort, contract or otherwise) arising out of any Credit Partys or such Agents or Lead Arrangers transmission of communications through the Internet, except to the extent the liability of such person is found in a final non-appealable judgment by a court of competent jurisdiction to have resulted from such persons bad faith, gross negligence or willful misconduct.
(f) Public/Private.
(i) Each Credit Party hereby authorizes the Administrative Agent to distribute (A) to Public Siders all Communications that the Borrower identifies in writing as containing no MNPI (Public Side Communications), and the Borrower represents and warrants that no such Public Side Communications contain any MNPI, and, at the reasonable written request of the Administrative Agent, the Borrower shall use commercially reasonable efforts to identify Public Side Communications by clearly and
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conspicuously marking the same as PUBLIC; and (B) to Private Siders all Communications other than Public Side Communications (such Communications, Private Side Communications). The Borrower agrees to designate as Private Side Communications only those Communications or portions thereof that it reasonably believes in good faith constitute MNPI, and agrees to use commercially reasonable efforts not to designate any Communications provided under Sections 5.01(a), (b) and (c) as Private Side Communications. Private Siders shall mean Lenders employees and representatives who have declared that they are authorized to receive MNPI. Public Siders shall mean Lenders employees and representatives who have not declared that they are authorized to receive MNPI; it being understood that Public Siders may be engaged in investment and other market-related activities with respect to the Borrowers or its Affiliates securities or loans. MNPI shall mean material non-public information (within the meaning of United States federal securities laws assuming that Holdings is a public reporting company under federal securities laws (regardless of whether Holdings is actually a public reporting company under federal securities laws)) with respect to Holdings, its Affiliates, its Subsidiaries and any of their respective securities.
(ii) Each Lender acknowledges that United States federal and state securities laws prohibit any person from purchasing or selling securities on the basis of material, non-public information concerning the issuer of such securities or, subject to certain limited exceptions, from communicating such information to any other person. Each Lender confirms that it has developed procedures designed to ensure compliance with these securities laws.
(iii) Each Lender acknowledges that circumstances may arise that require it to refer to Communications that may contain MNPI. Accordingly, each Lender agrees that it will use commercially reasonable efforts to designate at least one individual to receive Private Side Communications on its behalf in compliance with its procedures and applicable Requirements of Law and identify such designee (including such designees contact information) on such Lenders Administrative Questionnaire. Each Lender agrees to notify the Administrative Agent in writing from time to time of such Lenders designees e-mail address to which notice of the availability of Private Side Communications may be sent by electronic transmission.
Section 10.02 Waivers; Amendment.
(a) Generally. No failure or delay by any Agent, the Issuing Bank or any Lender in exercising any right or power hereunder or under any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of each Agent, the Issuing Bank and the Lenders hereunder and under the other Loan Documents are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of any Loan Document or consent to any departure by any Credit Party therefrom shall in any event be effective unless the same shall be permitted by this Section 10.02, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as a waiver of any Default, regardless of whether any Agent, any Lender or the Issuing Bank may have had notice or knowledge of such Default at the time. No notice or demand on the Borrower in any case shall entitle the Borrower to any other or further notice or demand in similar or other circumstances.
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(b) Required Consents. Subject to Section 10.02(c), (d), (e) and (g), neither this Agreement nor any other Loan Document nor any provision hereof or thereof may be waived, amended, supplemented or modified except, in the case of this Agreement, pursuant to an agreement or agreements in writing entered into by the Borrower and the Administrative Agent or, in the case of any other Loan Document (other than the Fee Letters, each of which may be amended in accordance with its terms), pursuant to an agreement or agreements in writing entered into by the Administrative Agent, the Collateral Agent (in the case of any Security Document) and the Credit Party or Credit Parties that are party thereto, in each case with the written consent of the Required Lenders; provided that no such agreement shall be effective if the effect thereof would be to:
(i) increase the Commitment of any Lender without the written consent of such Lender (but not, for the avoidance of doubt, the Required Lenders) (other than with respect to any Incremental Facilities to which such Lender has agreed) (it being understood that no amendment, modification, termination, waiver or consent with respect to any condition precedent, covenant, mandatory prepayment or Default or Event of Default shall constitute an increase in the Commitment of any Lender);
(ii) reduce the principal amount of or premium, if any, on any Loan or LC Disbursement or reduce the rate of interest thereon, including any provision establishing a minimum rate (other than any waiver, extension or reduction of interest pursuant to Section 2.06(c), any waivers or extensions of mandatory prepayments, or, for the avoidance of doubt, waivers of the provisions of Section 2.20(f)), or reduce any fees (including any Fees or any prepayment fee or premium) payable hereunder, without the written consent of each Lender directly and adversely affected thereby but not the Required Lenders (it being understood that any amendment or modification to the financial definitions in this Agreement shall not constitute a reduction in the rate of interest for purposes of this clause (ii));
(iii) (A) extend the scheduled final maturity of any Term Loan, or any scheduled date of payment of principal amount of any Term Loan under Section 2.09 (other than, for the avoidance of doubt, any mandatory prepayment) except in accordance with Section 2.20, Section 2.21, Section 2.22 and Section 2.23, (B) postpone the date for payment of any Reimbursement Obligation or any interest, premium or fees payable hereunder (other than waivers of default interest, Defaults or Events of Default, waivers or extension of any mandatory prepayments, or, for the avoidance of doubt, waivers of the provisions of Section 2.20(f)), or (C) postpone the scheduled date of expiration of any Revolving Commitment or date of repayment of any Revolving Loans, in each case, beyond the Revolving Maturity Date, except in accordance with Section 2.20, Section 2.21, Section 2.22 and Section 2.23, in any case, without the written consent of each Lender directly and adversely affected thereby (but not the Required Lenders);
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(iv) release Holdings or the Borrower or release all or substantially all of the value of the Subsidiary Guarantors from their Guarantees (except as expressly provided in Article IX or X), without the written consent of each Lender;
(v) release all or substantially all of the Collateral from the Liens of the Security Documents without the written consent of each Lender (except as otherwise expressly permitted by Section 9,10(a)(i) or Section 10.02(c)(iii) (other than clause (iv) thereof) or by the Security Documents); provided that, for the avoidance of doubt, any transaction permitted under Section 6.04 or Section 6.05 shall not be subject to this clause (v) to the extent such transaction does not result in the release of all or substantially all of the Collateral;
(vi) change any provision of this Section 10.02(b) that has the effect of decreasing the number of Lenders that must approve any amendment, modification or waiver (or the approval of any Agent, Issuing Bank or Swing Line Lender), without the written consent of each Lender (or, as applicable, such Agent, Issuing Bank or Swing Line Lender);
(vii) change the percentage set forth in the definition of Required Lenders or Required Revolving Lenders, without the written consent of each Lender (or each Lender of such Class, as the case may be), other than to increase such percentage or number or to give any Additional Lender or group of Lenders such right to waive, amend or modify or make any such determination or grant any such consent;
(viii) change or waive any provision of Article IX as the same applies to any Agent, or any other provision hereof as the same applies to the rights or obligations of any Agent, in each case without the written consent of such Agent;
(ix) change or waive any obligation of the Lenders relating to the issuance of or purchase of participations in Letters of Credit, without the written consent of the Administrative Agent and the Issuing Bank;
(x) make any change or amendment, including without limitation, any amendment of this Section 10.02(b)(x) which shall (i) unless in writing and signed by the Issuing Bank in addition to the Lenders required above, adversely affect the rights or duties of the Issuing Bank under this Agreement or any document relating to any Letter of Credit issued or to be issued by it, and (ii) unless in writing and signed by the Swing Line Lender in addition to the Lenders required above, adversely affect the rights or duties of the Swing Line Lender under this Agreement; or
(xi) amend or modify (a) the definition of Pro Rata Percentage or any pro rata sharing provisions contained herein or (b) the waterfall that applies following enforcement of the Loan Documents pursuant to Section 8.02, in each case without the written consent of each Lender directly and adversely affected thereby;
provided that, notwithstanding the foregoing, this Agreement may be amended to make any change that by its terms only affects the rights and duties of Lenders holding Loans or Commitments of a particular Class (and not Lenders holding Loans or Commitments of any other Class) with the consent of the Lenders holding the relevant Loans or Commitments voting as if such Class were the only Class hereunder.
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Notwithstanding anything herein to the contrary, (I) no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder, except to the extent the consent of such Lender would be required under clause (i), (ii) or (iii) in the proviso to the first sentence of this Section 10.02(b) and, but only to the extent that any such matter disproportionately affects such Defaulting Lender, clauses (iv) or (v) of such proviso, (II) this Agreement and any other Loan Document may be amended, modified or supplemented solely with the consent of the Administrative Agent (or the Collateral Agent, as applicable) and the Borrower, each in their sole discretion, without the need to obtain the consent of any other Lender, if such amendment, modification or supplement is delivered in order to (x) cure ambiguities, defects, errors, mistakes, omissions in this Agreement or the applicable Loan Document, (y) add terms that are favorable to the Lenders (as reasonably determined by the Administrative Agent) in connection with any Incremental Facility, Permitted Incremental Equivalent Debt, Credit Agreement Refinancing Indebtedness or Permitted Debt Exchange Notes, or (z) create a fungible Class of Term Loans (including by increasing (but, for the avoidance of doubt, not by decreasing) the amount of amortization due and payable with respect to any Class of Term Loans) (provided that, at the election of the Administrative Agent in its sole discretion, any amendment described in clauses (x) through (z) shall not become effective unless the Lenders have received at least five Business Days prior written notice thereof and the Administrative Agent shall not have received, within five Business Days of the date of such notice to the Lenders, a written notice from the Required Lenders stating that the Required Lenders object to such amendment) or, in the case of any applicable Intercreditor Agreement (or any other intercreditor agreement and/or subordination agreement pursuant to, or contemplated by, the terms of this Credit Agreement (including with respect to Indebtedness permitted pursuant to Section 6.01 and defined terms referenced therein)), if such amendment relates to obligations other than the Obligations hereunder, or to grant a new Lien for the benefit of the Secured Parties or extend an existing Lien over additional property and (III) this Agreement and the other Loan Documents may be amended, modified or supplemented solely with the consent of the Administrative Agent (or the Collateral Agent, as applicable) and the Borrower in order to give effect to the appointment of an Additional Borrower in accordance with Section 2.24.
Any waiver, amendment, supplement or modification in accordance with this Section 10.02 shall apply equally to each of the affected Lenders and shall be binding upon Holdings, the Borrower, such Lenders, the Administrative Agent, the Collateral Agent and all future holders of the affected Loans. In the case of any such waiver, Holdings, the Borrower, the Lenders, the Administrative Agent and the Collateral Agent shall be restored to their former positions and rights hereunder and under the other Loan Documents, and any Default or Event of Default so waived shall be deemed to be cured and not continuing, it being understood that no such waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon. In connection with the foregoing provisions, the Administrative Agent may, but shall have no obligations to, with the concurrence of any Lender, execute amendments, modifications, waivers or consents on behalf of such Lender.
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(c) Collateral.
(i) Without the consent of any other person, but subject to the terms of any applicable Intercreditor Agreement, the applicable Credit Party or Parties and the Administrative Agent and/or Collateral Agent may (in its or their respective sole discretion), or shall, to the extent required by any Loan Document enter into any amendment or waiver of any Loan Document, or enter into any new agreement or instrument, to effect the granting, perfection, protection, expansion (including to cover additional amounts as secured obligations thereunder) or enhancement of any security interest in any Collateral or additional property to become Collateral for the benefit of the Secured Parties, or as required by local law to give effect to, or protect, any security interest for the benefit of the Secured Parties in any property or so that the security interests therein comply with applicable Requirements of Law.
(ii) Notwithstanding anything in this Agreement or any Security Document to the contrary, the Administrative Agent and/or, as applicable, the Collateral Agent may, in its sole discretion, grant extensions of time for the satisfaction of any of the requirements under Sections 5,10 and 5,11 or of any Security Document in respect of any particular Collateral or any particular Subsidiary if it determines that the satisfaction thereof with respect to such Collateral or such Subsidiary cannot be accomplished without undue expense or unreasonable effort or due to factors beyond the control of Holdings, the Borrower and the Restricted Subsidiaries by the time or times at which any such requirement would otherwise be required to be satisfied under this Agreement or any Security Document.
(iii) The Lenders hereby irrevocably agree that the Liens granted to the Collateral Agent by the Credit Parties on any Collateral shall be automatically released (i) in full, upon the termination of this Agreement and the payment in full of all Secured Obligations (other than (A) contingent indemnification obligations and unasserted expense reimbursement obligations, (B) obligations and liabilities under Secured Cash Management Agreements and Secured Hedging Agreements as to which arrangements satisfactory to the applicable Cash Management Bank or Hedge Bank shall have been made, and (C) Letters of Credit that have been cash collateralized in accordance with the terms of this Agreement, backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank), (ii) upon the sale or other disposition of such Collateral (including as part of or in connection with any other sale or other disposition permitted hereunder) to any Person other than another Credit Party, to the extent such sale or other disposition is made in compliance with the terms of this Agreement (and the Collateral Agent may rely conclusively on a certificate to that effect provided by any Credit Party upon its reasonable request without further inquiry), (iii) to the extent such Collateral is comprised of property leased to a Credit Party, upon termination or expiration of such lease, (iv) if the release of such Lien is approved, authorized or ratified in writing by the Required Lenders (or such other percentage of the Lenders whose consent may be required in accordance with this Section 10.02), (v) to the extent the property constituting such Collateral is owned by any Guarantor, upon the release of such Guarantor from its obligations under the applicable Guarantee (in accordance with the second following sentence), (vi) as required to effect any sale or other disposition of Collateral in connection with any exercise of remedies of the
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Collateral Agent pursuant to the Security Documents, or (vii) if such assets constitute Excluded Property. Any such release shall not in any manner discharge, affect or impair the Obligations or any Liens (other than those being released) upon (or obligations (other than those being released) of the Credit Parties in respect of) all interests retained by the Credit Parties, including the proceeds of any sale, all of which shall continue to constitute part of the Collateral except to the extent otherwise released in accordance with the provisions of the Loan Documents. Additionally, the Lenders hereby irrevocably agree that any Restricted Subsidiary that is a Guarantor shall be released from the Guarantees upon consummation of any transaction not prohibited by this Agreement resulting in such Subsidiary ceasing to constitute a Restricted Subsidiary or upon becoming an Excluded Subsidiary. The Lenders hereby authorize the Administrative Agent and the Collateral Agent, as applicable, to, and the Administrative Agent and the Collateral Agent agree to, execute and deliver any instruments, documents and agreements necessary or desirable or reasonably requested by the Borrower to evidence and confirm the release of any Guarantor or Collateral pursuant to the foregoing provisions of this paragraph, all without the further consent or joinder of any Lender and without any representation or warranty of any such Agent or Lender.
(d) Certain Other Amendments. Notwithstanding anything in this Agreement (including, without limitation, this Section 10.02) or any other Loan Document to the contrary, (i) this Agreement and the other Loan Documents may be amended to effect an Incremental Amendment, Refinancing Amendment or Extension Amendment pursuant to Sections 2,20, 2,21 or 2,22 (and the Administrative Agent and the Borrower may effect such amendments to this Agreement and the other Loan Documents without the consent of any other party, as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent and the Borrower, to effect the terms of any such Incremental Amendment, Refinancing Amendment or Extension Amendment); and (ii) the Loan Documents may be amended to add syndication or documentation agents and make customary changes and references related thereto with the consent of only the Borrower and the Administrative Agent.
(e) Amendments to Financial Covenant and Waivers of Events of Default Under Section 6.08. Notwithstanding anything set forth herein to the contrary, no amendment to Section 6.08, Section 8.01(d) (solely as it relates to an Event of Default under Section 6.08), Section 8.03 or the defined terms used in any thereof (but not as used in other Sections), no consent to departure therefrom, and no waiver with respect to a Default or Event of Default under Section 6.08, shall be effective without the prior written consent of the Borrower and the Required Revolving Lenders, it being understood that the consent of no other Lender (including the Required Lenders) shall be required. Any condition precedent to any Borrowing of Revolving Loans may be waived by only the Required Revolving Lenders (and, in the case of (x) the issuance of a Letter of Credit, the Issuing Bank and (y) any Borrowing of Swing Line Loans, the Swing Line Lender) and, for the avoidance of doubt, waivers by no other Lender shall be required.
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(f) Non-Consenting Lenders. The Borrower may, at its sole expense and effort, upon notice to a Non-Consenting Lender and the Administrative Agent, require such Lender to (i) be paid off in full for all of its Loans and interest due related thereto and relinquish all rights it has under the Loan Documents (including any amount pursuant to Section 2.10(i) if a Repricing Event has occurred), or (ii) assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 10.04), all of its interests, rights (other than its existing rights to payments pursuant to Section 2.12, Section 2.15 and Section 2.16) and obligations under this Agreement and the related Loan Documents to an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment, or, solely in the case of Term Loans, Holdings or the Borrower (in which case such Term Loans shall, after such assignment, be immediately deemed cancelled for all purposes and no longer outstanding (and may not be resold) for all purposes of this Agreement and the other Loan Documents) or any Affiliated Debt Fund); provided that in the case of this clause (ii), (i) the Borrower shall have paid to the Administrative Agent (unless waived by the Administrative Agent) the assignment fee (if any) specified in Section 10.04(b); (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in LC Disbursements, accrued interest thereon, accrued fees and all other amounts payable (including any amount pursuant to Section 2.10(j) if a Repricing Event has occurred) to it hereunder in connection with any prepayment of its Loans and under the other Loan Documents from the assignee or the Borrower, (iii) such assignment does not conflict with applicable Law; and (iv) the applicable assignee shall have consented to the applicable amendment, waiver or consent. A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.
(g) Additional Credit Facilities. Subject to Sections 2,21 and 2,22 hereof this Agreement may be amended (or amended and restated) (i) to add one or more additional credit facilities to this Agreement and to permit the extensions of credit from time to time outstanding thereunder and the accrued interest and fees in respect thereof to share ratably in the benefits of this Agreement and the other Loan Documents and (ii) to include appropriately the Lenders holding such credit facilities in any determination of the Required Lenders on substantially the same basis as the Lenders prior to such inclusion.
Section 10.03 Expenses; Indemnity; Damage Waiver.
(a) Costs and Expenses. The Borrower shall pay, promptly following written demand therefor: (i) all reasonable and documented out-of-pocket expenses incurred by the Lead Arrangers, the Administrative Agent, the Collateral Agent and their respective Affiliates (including the reasonable and documented out-of-pocket fees, charges and disbursements of one counsel to the Lead Arrangers, the Administrative Agent, the Collateral Agent and their respective Affiliates, taken as a whole (plus additional counsel desirable due to actual or reasonably perceived conflicts of interest among such parties), plus, if reasonably necessary, the reasonable fees, charges and disbursements of one local counsel per appropriate jurisdiction (which may include a single special counsel acting in multiple jurisdictions), for the Administrative Agent and/or the Collateral Agent (plus additional counsel desirable due to actual or reasonably perceived conflicts of interest among such parties)) in connection with the syndication of the credit facilities provided for herein (including the obtaining and maintaining of CUSIP numbers for the Loans), the preparation, negotiation, execution, delivery, filing and administration of this Agreement including any expenses incurred as a result of trades not permitted by Section 10.04 and the other Loan Documents and any amendment, amendment and restatement, modification or waiver of the provisions hereof or thereof (whether or not the
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transactions contemplated hereby or thereby shall be consummated), including in connection with post-closing searches to confirm that security filings and recordations have been properly made, (ii) all reasonable and documented out-of-pocket expenses incurred by the Issuing Bank in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder, (iii) all reasonable and documented out-of-pocket expenses incurred by the Swing Line Lender in connection with any Swing Line Loans or any amendment, renewal or extension thereof or any demand for payment thereunder, (iv) all reasonable and documented out-of-pocket expenses incurred by the Lead Arrangers, the Administrative Agent, the Collateral Agent, any Lender or the Issuing Bank (including the reasonable and documented out-of-pocket fees, charges and disbursements of any one counsel to the Administrative Agent, the Collateral Agent, the Lenders and the Issuing Bank, taken as a whole (plus additional counsel desirable due to actual or reasonably perceived conflicts of interest among such parties), plus, if reasonably necessary, the reasonable and documented out-of-pocket fees, charges and disbursements of one local counsel per appropriate jurisdiction (plus additional counsel desirable due to actual or reasonably perceived conflicts of interest among such parties) and, upon the Borrowers prior written consent (not to be unreasonably withheld or delayed), other counsel to and consultants for the Administrative Agent, the Collateral Agent, any Lender or the Issuing Bank), in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section 10.03, or (B) in connection with the Loans made or Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit and (v) all Other Taxes, as provided in Section 2.15.
(b) Indemnification by the Borrower. The Borrower shall indemnify the Lead Arrangers, the Administrative Agent (and any sub-agent thereof), the Collateral Agent (and any sub-agent thereof), each Lender, the Issuing Bank, the Swing Line Lender and each Related Party of any of the foregoing persons (each such person being called an Indemnitee) against, and hold each Indemnitee harmless from, any and all actual and direct losses (other than lost profits), claims, damages, liabilities and related reasonable and documented out-of-pocket expenses (including the reasonable and documented out-of-pocket fees and reasonable out-of-pocket expenses of one counsel for all Indemnitees (plus additional counsel desirable due to actual or reasonably perceived conflicts of interest among the Indemnitees) plus, if reasonably necessary, the reasonable and documented out-of-pocket fees and expenses of one local counsel per appropriate jurisdiction (plus additional counsel desirable due to actual or reasonably perceived conflicts of interest among such parties) and, upon the Borrowers prior written consent (not to be unreasonably withheld or delayed), consultants) (but excluding allocated costs of in-house counsel) incurred by any Indemnitee or asserted against any Indemnitee by any party hereto or any third party arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document, or any amendment, amendment and restatement, modification or waiver of the provisions hereof or thereof, or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by the Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or Release or threatened Release of Hazardous Materials on, at, under or from any Real Property or
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facility now or hereafter owned, leased or operated by any Group Member at any time, or any Environmental Claim related in any way to any Group Member, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by the Borrower or any other Credit Party, and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (v) arise out of actions taken or omissions to act by such Indemnitee in its capacity as a co-investor in Holdings and its Restricted Subsidiaries, (w) are determined by a final, non-appealable judgment of a court of competent jurisdiction to have resulted from the bad faith, gross negligence or willful misconduct of such Indemnitee or (to the extent involved in or aware of the Transactions) any of its Controlling Persons, Controlled Affiliates or any of the officers, directors, employees, partners or agents, advisors or representatives, of any of the foregoing, (x) result from a claim brought by the Borrower or any other Credit Party against such Indemnitee for material breach of such Indemnitees obligations hereunder or under any other Loan Document (by such Indemnitee or its Controlling Persons or Controlled Affiliates), if the Borrower or such other Credit Party has obtained a final non- appealable judgment in its favor on such claim as determined by a court of competent jurisdiction, (y) arises from disputes arising solely among Indemnitees that do not involve an Agent or Lead Arranger acting in its capacity as such or any act or omission by any Group Member or its Affiliates and are unrelated to any dispute involving, or any claim by, an Agent, a Lead Arranger, any Lender or Secured Party against any Group Member or its Affiliates, or (z) are payable as a result of a settlement agreement related to the foregoing effected without the written consent of the Borrower (which consent shall not to be unreasonably withheld or delayed) (in the case of this clause (z), for the avoidance of doubt, if settled with the Borrowers written consent, or if there is a final judgment for the plaintiff against an Indemnitee in any proceeding, the Borrower shall indemnify and hold harmless each Indemnitee to the extent and in the manner set forth above); provided, however, that such Indemnitee shall promptly refund any amount paid to such Indemnitee for fees, expenses, damages, indemnification or contribution, in each case, pursuant to this Section 10.03(b) to the extent that there is a final, non-appealable judicial determination that such Indemnitee was not entitled to the payment of such amounts pursuant to the express terms of this Section 10.03. For the avoidance of doubt, this Section 10.03(b) shall not apply to Taxes other than Taxes that represent losses, claims, damages, liabilities, etc. arising from any non-Tax claim.
(c) Reimbursement by Lenders. To the extent that the Borrower for any reason fail to pay any amount required under clause (a) or (b) of this Section 10.03 to be paid by it to the Administrative Agent (or any sub-agent thereof), the Collateral Agent (or any sub-agent thereof), the Issuing Bank, the Swing Line Lender or any Related Party of any of the foregoing, each Lender severally agrees to pay (whether or not any such amount arises, in whole or in part, out of the comparative, contributory or sole negligence of the Administrative Agent (or any such sub-agent), the Collateral Agent (or any such sub-agent thereof), the Issuing Bank, the Swing Line Lender or such Related Party) to the Administrative Agent, the Collateral Agent, the Issuing Bank, the Swing Line Lender or such Related Party, as the case may be, such Lenders pro rata share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought or, if indemnification is sought after the date upon which all Commitments shall have terminated and the Loans and Reimbursement Obligations shall have been paid in full, ratably in accordance with such outstanding Loans and Commitments as in effect immediately prior to
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such date) of such unpaid amount (such indemnity shall be effective whether or not the related losses, claims, damages, liabilities and related expenses are incurred or asserted by any party hereto or any third party); provided that (i) the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or any such sub-agent), the Collateral Agent (or any sub-agent thereof) the Issuing Bank in its capacity as such, the Swing Line Lender or any Related Party of any of the foregoing acting for the Administrative Agent (or any such sub-agent), the Collateral Agent (or any sub-agent thereof) or the Issuing Bank in connection with such capacity and (ii) such indemnity for the Issuing Bank shall not include losses incurred by the Issuing Bank due to one or more Lenders defaulting in their obligations to purchase participations of LC Exposure under Section 2.18(d) or to make Revolving Loans under Section 2.18(e) (it being understood that this proviso shall not affect the Issuing Banks rights against any Defaulting Lender). The obligations of the Lenders under this clause (c) are subject to the provisions of Section 2.14. For purposes hereof, a Lenders pro rata share shall be determined based upon its share of the sum of the total Revolving Exposure, outstanding Term Loans and unused Commitments at the time.
(d) Waiver of Consequential Damages, Etc. To the fullest extent permitted by applicable Requirements of Law, no party shall assert, and each party hereby waives, any claim against any other party hereto or any of its Related Parties on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof (in each case, other than, in the case of any Credit Party, in respect of any such damages incurred or paid by an Indemnitee to a third party and otherwise required to be indemnified by a Credit Party under this Section 10.03). No party hereto nor any of its Related Parties shall be liable for any damages (other than those damages resulting from bad faith, gross negligence or willful misconduct of such Person, as determined by a court of competent jurisdiction by final and nonappealable judgment) arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby.
(e) Payments. All amounts due under this Section shall be payable not later than 30 Business Days after written demand (including detailed invoices) therefor.
Section 10.04 Successors and Assigns.
(a) Successors and Assigns Generally. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder (other than in connection with a transaction permitted by Section 6.04) without the prior written consent of the Administrative Agent, the Collateral Agent, the Issuing Bank, the Swing Line Lender and each Lender (and any other attempted assignment or transfer by the Borrower shall be null and void), and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an Eligible Assignee in accordance with the provisions of clause (b) of this Section 10.04, Section 2.16(b) or Section
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10.02(f), (ii) by way of participation in accordance with the provisions of clause (d) of this Section 10.04 or (iii) by way of pledge or assignment of a security interest in accordance with clause (f) of this Section 10.04. Nothing in this Agreement or any other Loan Document, expressed or implied, shall be construed to confer upon any person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in clause (d) of this Section and, to the extent expressly contemplated hereby, the other Indemnitees) any legal or equitable right, remedy or claim under or by reason of this Agreement or any other Loan Document.
(b) Assignments by Lenders. Any Lender may at any time assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it), subject to, except in the case of an assignment to (x) in the case of Term Loan Commitments or Term Loans, a Lender, an Affiliate of a Lender or an Approved Fund with respect to a Lender (in each case other than a Disqualified Institution) and (y) in the case of Revolving Commitments or Revolving Loans, a Revolving Lender, an Affiliate of a Revolving Lender or an Approved fund with respect to such Revolving Lender (in each case, other than a Disqualified Institution), the prior written consent of the Administrative Agent (and, in the case of such Revolving Lenders Revolving Commitments, the Issuing Banks) and, so long as (other than in the case of a proposed assignment to a Disqualified Institution and solely with respect to assignments of Term Loan Commitments or Term Loans (and for the avoidance of doubt, not with respect to assignments of Revolving Commitments or Revolving Loans)) no Event of Default under Section 8.01(a), (b), (g) with respect to the Borrower, or (h) with respect to the Borrower shall have occurred and be continuing, the Borrower (each such consent not to be unreasonably withheld or delayed; the Borrowers consent to be deemed to have been given if (except in the case of a proposed assignment to a Disqualified Institution) the Borrower has not responded within ten Business Days of a written request for such consent); provided that:
(i) except in the case of any assignment (a) of the entire remaining amount of the assigning Lenders Commitment and the Loans at the time owing to it or (b) to a Lender or an Affiliate of a Lender or an Approved Fund with respect to a Lender, the aggregate amount of the Commitment (which for this purpose includes Loans outstanding thereunder) or, if the applicable Commitment is not then in effect, the outstanding principal balance of the Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent) shall not be less than $5,000,000, in the case of any assignment in respect of Revolving Loans and/or Revolving Commitments, or $1,000,000, in the case of any assignment in respect of Term Loans and/or Term Loan Commitments, and, in each case $1,000,000 increments thereof, or if less, all of such Lenders remaining Loans and commitments of the applicable Class (provided that contemporaneous assignments to or by two or more affiliated Approved Funds shall be aggregated for purposes of meeting such minimum transfer amount), unless each of the Administrative Agent and, so long as no Event of Default under Section 8.01(a), (b), (g), or (h) has occurred and is continuing, the Borrower otherwise consents (each such consent not to be unreasonably withheld or delayed, and which consent shall be deemed to have been given by the Borrower if the Borrower shall not have responded within ten Business Days of a written request for such consent);
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(ii) each partial assignment shall be made as an assignment of a proportionate part of all of the assigning Lenders rights and obligations under this Agreement with respect to the Loan or the Commitment assigned, except that this clause (ii) shall not prohibit any Lender from assigning all or a portion of its rights and obligations among separate tranches on a non-p/v; rata basis;
(iii) the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with (other than in the case of an assignment to an Affiliate of the assigning Lender or to the Sponsor, Holdings, any Subsidiaries of Holdings, or any of their respective Affiliates) a processing and recordation fee of $3,500 (which fee may be waived or reduced by the Administrative Agent in its discretion), and the Eligible Assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire and all other know-your- customer documentation reasonably requested by the Administrative Agent;
(iv) no assignment shall be made to a Disqualified Institution without the Borrowers prior consent in writing (which consent may be withheld in its sole discretion), and upon an inquiry by any Lender to the Administrative Agent as to whether a specific potential assignee or prospective participant is a Disqualified Institution, the Administrative Agent shall be permitted to disclose to such inquiring Lender whether such specific potential assignee or prospective participant is on the list of Disqualified Institutions; provided that the Administrative Agent shall not be responsible or have any liability for, or have any duty to ascertain, inquire into, monitor, update or enforce, compliance with the provisions hereof relating to Disqualified Institutions and shall not be obligated to ascertain, monitor or inquire as to whether any Lender or Participant or prospective Lender or Participant is a Disqualified Institution or have any liability with respect to or arising out of any assignment or participation to or disclosure of confidential information to, a Disqualified Institution;
(v) notwithstanding anything to the contrary contained in this Agreement, any Lender may assign all or a portion of its Term Loans (but not, for the avoidance of doubt, any Revolving Commitments) to any Person who is or, after giving effect to such assignment, would be an Equity Investor (other than Affiliated Debt Funds) or an Affiliate of Holdings (other than Holdings, the Borrower or any of their respective Subsidiaries or any natural person or any Affiliated Debt Funds) (collectively, the Sponsor Investors) (without the consent of any Person); provided that (1) the assigning Lender and each Sponsor Investor purchasing such Lenders Term Loans shall execute and deliver to the Administrative Agent an Assignment and Assumption via an electronic settlement system or by manual execution, (2) at the time of such assignment after giving effect to such assignment, the aggregate principal amount of all Term Loans held by the Sponsor Investors shall not exceed 25% of the aggregate principal amount of all Term Loans then outstanding under this Agreement, (3) no Sponsor Investor shall be required to make any representation that it is not in possession of MNPI with respect to Holdings, its Subsidiaries or their respective securities, and all parties to the relevant repurchases shall render customary big boy disclaimer letters or any such disclaimers shall be incorporated into the terms of the Assignment and Assumption, and (4) for the avoidance of doubt, Lenders shall not be permitted to assign Revolving Commitments or Revolving Loans to any Sponsor Investor; and provided, further, that:
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(A) notwithstanding anything to the contrary in this Agreement, the Sponsor Investors shall not have any right to (1) attend (including by telephone or electronic means) any meeting, calls or discussions (or portions thereof) among the Administrative Agent or any Lender to which representatives of the Credit Parties are not invited or (2) receive any information or material provided by the Administrative Agent or any Lender solely to the Lenders or any communication by or among the Administrative Agent and/or one or more Lenders or have access to the Platform used to distribute information to the Lenders, except to the extent such information or materials have been made available to (or were prepared or otherwise provided by) any Credit Party or its representatives, nor will the Sponsor Investors be entitled to challenge any Agents or Lenders attorney-client privilege as a result of its status as Lender;
(B) notwithstanding anything in Section 10.04(b) or the definition of Required Lenders to the contrary, for purposes of determining whether the Required Lenders (or all Lenders or affected Lenders) have consented (or not consented) to any amendment, modification, waiver or consent with respect to any of the terms of any Loan Document or any departure by any Credit Party therefrom, the Loans of such Sponsor Investor shall not be included in the calculation of Required Lenders (or if such non-voting designation is unenforceable for any reason, such Sponsor Investor shall be deemed to have voted its interest as a Lender without discretion in the same proportion as the allocation of voting with respect to such matter by Lenders who are not Sponsor Investors); provided that no amendment, modification, waiver or consent with respect to any Loan Document shall deprive such Sponsor Investor of its pro rata share of any payments to which such Sponsor Investor is entitled under the Loan Documents and such Sponsor Investor shall be entitled to vote on any amendment pursuant to clauses (i)-(vii) and/or (xi) of the first proviso to Section 10.02(b) or which disproportionately affects such Sponsor Investor in its capacity as a Lender; and in furtherance of the foregoing, such Sponsor Investor agrees to execute and deliver to the Administrative Agent any instrument reasonably requested by the Administrative Agent to evidence the voting of its interest as a Lender in accordance with the provisions of this Section 10.04(b)(v); provided that if such Sponsor Investor fails to promptly execute such instrument such failure shall in no way prejudice any of the Administrative Agents rights under this paragraph;
(C) in the event that any proceeding under the Bankruptcy Code shall be instituted by or against the Borrower or any Guarantor, each Sponsor Investor shall acknowledge and agree that it is an insider under Section 101(31) of the Bankruptcy Code and, as such, the claims associated with the Loans and Commitments owned by it shall not be included in determining
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whether the applicable class of creditors holding such claims has voted to accept a proposed plan for purposes of section 1129(a)(10) of the Bankruptcy Code, or, alternatively, to the extent that the foregoing designation is deemed unenforceable for any reason, such Sponsor Investor shall vote in such proceedings in the same proportion as the allocation of voting with respect to such matter by those Lenders who are not Sponsor Investors, except to the extent that any plan of reorganization proposes to treat the Obligations held by such Sponsor Investor in a manner that is less favorable in any material respect to such Sponsor Investor than the proposed treatment of similar Obligations held by Lenders that are not Sponsor Investors; and
(D) each Sponsor Investor hereby waives, to the fullest extent permitted at law, any rights to bring any claims, actions or suits against the Administrative Agent and/or the Collateral Agent (solely in their respective capacities as such) in connection with all Loans and Commitments held by such Sponsor Investor;
(vi) notwithstanding anything to the contrary herein, each Sponsor Investor, in its capacity as a Term Loan Lender, in its sole and absolute discretion, may make one or more capital contributions or assignments of Term Loans that it acquires in accordance with Section 10.04(b)(v) directly or indirectly to Holdings or the Borrower solely in exchange for Equity Interests of Holdings (other than Disqualified Capital Stock) or a direct or indirect parent thereof or debt securities of a parent entity of Holdings, in each case upon written notice to the Administrative Agent. Immediately upon Holdings or the Borrowers acquisition of Term Loans from a Sponsor Investor, such Term Loans and all rights and obligations as a Lender related thereto shall for all purposes (including under this Agreement, the other Loan Documents and otherwise) be deemed to be irrevocably prepaid, terminated, extinguished, cancelled and of no further force and effect and the Borrower shall neither obtain nor have any rights as a Lender hereunder or under the other Loan Documents by virtue of such capital contribution or assignment;
(vii) [reserved];
(viii) notwithstanding anything to the contrary contained in this Section 10.04(b) or any other provision of this Agreement, each Lender shall have the right at any time to sell, assign or transfer all or a portion of its Term Loans owing to it to Holdings, the Borrower or any of their Subsidiaries on a non-p/vi rata basis, subject to the following limitations:
(A) no Default or Event of Default has occurred and is then continuing, or would immediately result therefrom;
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(B) Holdings, the Borrower or any of their Subsidiaries shall repurchase such Term Loans through either (y) conducting one or more modified Dutch auctions or other buy-back offer processes (each, an Offer Process) with a third party financial institution as auction agent to repurchase all or any portion of the Term Loans; provided that, (A) notice of such Offer Process shall be made to all Term Loan Lenders, and (B) such Offer Process shall be conducted pursuant to procedures mutually established by the Administrative Agent and the Borrower which are consistent with this Section 10.04(b)(viii) or (z) open market purchases on a non-pro rata basis;
(C) with respect to all repurchases made by Holdings, the Borrower or any of their Subsidiaries pursuant to this Section 10.04(b)(viii), (u) none of Holdings, the Borrower or any of their respective Subsidiaries shall be required to make any representations that Holdings, the Borrower or such Subsidiary is not in possession of any information regarding Holdings, its Subsidiaries or its Affiliates, or their assets, the Borrowers ability to perform its Obligations or any other matter that may be material to a decision by any Lender to participate in any offer or enter into any Assignment and Assumption or any of the transactions contemplated thereby that has not previously been disclosed to the Administrative Agent and Private Siders, (v) the repurchases are in compliance with Sections 6,03 and 6,06 hereof, (w) no Default or Event of Default has occurred and is continuing or would result from such repurchase, (x) Holdings, the Borrower or such Subsidiary shall not use the proceeds of any Revolving Loans or Swing Line Loans to acquire such Term Loans, (y) the assigning Lender and Holdings, the Borrower or such Subsidiary, as applicable, shall execute and deliver to the Administrative Agent an Assignment and Assumption in form and substance reasonably satisfactory to the Administrative Agent, and (z) all parties to the relevant repurchases shall render customary big boy disclaimer letters or any such disclaimers shall be incorporated into the terms of the Assignment and Assumption; and
(D) following repurchase by Holdings, the Borrower or such Subsidiary pursuant to this Section, the Term Loans so repurchased shall, without further action by any Person, be deemed cancelled for all purposes and no longer outstanding (and may not be resold by Holdings, the Borrower or such Subsidiary), for all purposes of this Agreement and all other Loan Documents, including, but not limited to (1) the making of, or the application of, any payments to the Lenders under this Agreement or any other Loan Document, (2) the making of any request, demand, authorization, direction, notice, consent or waiver under this Agreement or any other Loan Document or (3) the determination of Required Lenders, or for any similar or related purpose, under this Agreement or any other Loan Document and the Borrower shall neither obtain nor have any rights as a Lender hereunder or under the other Loan Documents by virtue of such repurchase (without limiting the foregoing, in all events, such Term Loans may not be resold or otherwise assigned, or subject to any participation, or otherwise transferred by the Borrower). In connection with any Term Loans repurchased and cancelled pursuant to this Section 10.04(b)(viii), the Administrative Agent is authorized to make appropriate entries in the Register to reflect any such cancellation.
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Subject to the recording thereof by the Administrative Agent pursuant to clause (c) of this Section 10.04, from and after the date such recordation in the Register is made, the Eligible Assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement (including, for the avoidance of doubt, any rights and obligations pursuant to Section 2.15), and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lenders rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 2,12, 2,13, 2,15, and 10.03 with respect to facts and circumstances occurring prior to the effective date of such assignment. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this paragraph shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with clause (d) of this Section 10.04.
(c) Register. The Administrative Agent, acting solely for this purpose as a non-fiduciary agent of the Borrower (and such agency being solely for tax purposes), shall maintain at one of its offices a copy of each Assignment and Assumption delivered to it (or the equivalent thereof in electronic form) and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal and stated interest amounts of the Loans and LC Disbursements owing to, each Lender pursuant to the terms hereof from time to time (the Register). The entries in the Register shall be presumptively correct absent manifest error, and the Borrower, the Administrative Agent, the Issuing Bank and the Lenders shall treat each person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary. No assignment shall be effective unless recorded in the Register. The Register is intended to cause each Loan and other obligation hereunder to be in registered form within the meaning of Section 5f.103-1(c) of the United States Treasury Regulations and within the meaning of Sections 163(f), 871(h)(2) and 881(c)(2) of the Code. The Register shall be available for inspection by the Borrower, the Issuing Bank (with respect to its own interests), the Collateral Agent, the Swing Line Lender (with respect to its own interests) and any Lender (with respect to its own interests), at any reasonable time and from time to time upon reasonable prior notice.
(d) Participations.
(i) Any Lender may at any time, without the consent of, or notice to, the Borrower, the Administrative Agent, or the Issuing Bank, sell participations to any person (other than a natural person or the Borrower or any of its Affiliates or any Disqualified Institutions) (each, a Participant) in all or a portion of such Lenders rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans owing to it); provided that (A) such Lenders obligations under this Agreement shall remain unchanged, (B) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, and (C) the Borrower, the Administrative Agent and the Lenders and Issuing Bank shall continue to deal solely and directly with such Lender in connection with such Lenders rights and obligations under this Agreement.
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(ii) Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce the Loan Documents and to approve any amendment, modification or waiver of any provision of the Loan Documents; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver with regard to amendments, modifications or waivers described in clauses (i)-(v) of the first proviso in Section 10.02(b), in each case, that directly affects such Participant. Subject to clause (e) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of and subject to the obligations and requirements of Sections 2,12 and 2,15 (provided that any documentation required to be provided by a Participant pursuant to Section 2.15(e) shall be provided to the participating Lender and, if Additional Amounts are required to be paid pursuant to Section 2.15, to the Borrower and the Administrative Agent), and the definition of Excluded Taxes shall apply to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to clause (b) of this Section. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 10.08 as though it were a Lender; provided that such Participant shall be subject to Section 2.14 as though it were a Lender. Notwithstanding anything to the contrary, no Lender shall enter into any agreement with any Participant that will permit such Participant to influence or control the voting rights of such Lender except with regard to amendments, modifications and waivers described in clauses (i)-(v) of the first proviso in Section 10.02(b), in each case, that directly affects such Participant.
(iii) Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower (and such agency being solely for tax purposes), maintain a register on which it enters the name and address of each Participant and the principal and stated interest amounts of each participants interest in the Loans or other obligations under this Agreement (a Participant Register); provided that no Lender shall have any obligation to disclose all or any portion of a Participant Register (including the identity of any Participant or any information relating to a Participants interest in any commitments, loans, letters of credit or other obligations under any Loan Document) to any Person except to the extent such disclosure is necessary to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.l03-l(c) of the United States Treasury Regulations and within the meaning of Sections 163(f), 871(h)(2) and 881(c)(2) of the Code and to confirm a Participant is not a Disqualified Institution. The entries in a Participant Register shall be presumptively correct absent manifest error, and such Lender shall treat each person whose name is recorded in a Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary.
(iv) Any such participation that does not comply with this Section shall be void ab initio and, promptly following such Lender becoming aware that any such participation has been made in breach of this Section, the Participant Register shall be modified by it to reverse such participation and shall be disclosed to the Borrower and the Administrative Agent.
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(v) The Administrative Agent shall have no responsibility (in its capacity as Administrative Agent) for (i) maintaining a Participant Register and (ii) any Lenders compliance with this Section 10.04, including any sale of participations to a Disqualified Institution in violation hereof by any Lender.
(e) Limitations on Participant Rights. A Participant shall not be entitled to receive any greater payment under Sections 2,12, 2,13 or 2,15 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrowers prior written consent or except to the extent the right to greater payment results from a Change in Law after the Participant becomes a Participant.
(f) Certain Pledges. Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender without restriction, including any pledge or assignment to secure obligations to a Federal Reserve Bank or any central bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto. In the case of any Lender that is a fund that invests in bank loans or similar extensions of credit, such Lender may, without the consent of the Borrower or the Administrative Agent or any other Person, collaterally assign or pledge all or any portion of its rights under this Agreement, including the Loans and Notes or any other instrument evidencing its rights as a Lender under this Agreement, to any holder of, trustee for, or any other representative of holders of, obligations owed or securities issued, by such fund, as security for such obligations or securities.
(g) Disqualified Institutions. Notwithstanding anything to the contrary herein, if any Loans are assigned or any participations are purchased or otherwise acquired, without the Borrowers consent (in violation of Section 10.04(b) or (d)), to any Disqualified Institution, then: (i) the Borrower may, at its sole expense and effort, upon notice to the applicable Disqualified Institution and the Administrative Agent, (x) terminate any commitment of such Disqualified Institution and repay any applicable outstanding Loans (in the case of Term Loans, at a price equal to the lesser of par and the amount that the applicable Disqualified Institution paid to acquire such Loans), plus accrued interest, accrued fees and all other amounts (other than principal amounts) payable to it hereunder, but, notwithstanding anything to the contrary, without premium, penalty, prepayment fee or breakage, and/or (y) require such Disqualified Institution to assign its rights and obligations to one or more Eligible Assignees at the price indicated in the immediately preceding clause (x), plus accrued interest, accrued fees and all other amounts (other than principal amounts) payable to it hereunder, but, notwithstanding anything to the contrary, without premium, penalty, prepayment fee or breakage (which assignment shall not be subject to the processing and recordation fee described in Section 10.04(b)(iii)), (ii) no such Disqualified Institution shall (x) receive any information or reporting provided by the Borrower, the Administrative Agent or any other Lender, (y) attend or participate in meetings attended by the Lenders and the Administrative Agent or (z) access any electronic site established for the Lenders or confidential communications from counsel to or financial advisors of the Administrative Agent or the Lenders, (iii) for purposes of voting, any Loans, Commitments or participations held by such Disqualified Institution shall be deemed not to be outstanding and such Disqualified Institution shall have no voting or consent rights with
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respect to Required Lender or Class votes or consents, in each case notwithstanding Section 10.02(b), (iv) for purposes of any matter requiring the vote or consent of each Lender affected by any amendment or waiver, such Disqualified Institution shall be deemed to have voted or consented to approve such amendment or waiver if a majority of the affected Class so approves and (v) such Disqualified Institution shall not be entitled to any expense reimbursement or indemnification rights ordinarily afforded to Lenders or Participants hereunder or in any Loan Document and such Disqualified Institution shall be treated in all other respects as a Defaulting Lender.
Section 10.05 Survival of Agreement. All covenants, agreements, representations and warranties made by the Credit Parties in the Loan Documents and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of the Loan Documents and the making of any Loans and issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Agents, the Issuing Bank or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement (other than contingent indemnification obligations, unasserted expense reimbursement obligations) is outstanding and unpaid or any Letter of Credit (other than any Letter of Credit that has been cash collateralized in accordance with the terms of this Agreement, backstopped with a back to back letter of credit in a manner reasonably acceptable to the applicable Issuing Bank or rolled into another credit facility to the sole satisfaction of the applicable Issuing Bank) is outstanding and so long as the Commitments have not expired or terminated. The provisions of Sections 2,12, 2,14, 2,15 and Article X (other than Section 10,12) shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the payment of the Reimbursement Obligations, the expiration or termination of the Letters of Credit and the Commitments or the termination of this Agreement or any provision hereof.
Section 10.06 Counterparts; Integration; Effectiveness.
(a) 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. This Agreement and the other Loan Documents, and any separate letter agreements with respect to fees payable to the Administrative Agent, constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 4,01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement by telecopier or other electronic transmission (PDF or TIFF format) shall be effective as delivery of a manually executed counterpart of this Agreement.
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(b) Without limiting the foregoing, each Credit Party each hereby acknowledges and agrees that (i) it has reviewed the terms and provisions of this Agreement and consents to the amendments and modifications effected hereby, and (ii) upon the effectiveness of this Agreement, the terms and conditions of the Existing First Lien Credit Agreement shall be amended, restated and of no further force and effect (except as to evidence the incurrence of the Obligations and Secured Obligations thereunder, the representations and warranties made and the actions or omissions performed or required to be performed thereunder prior to the effectiveness hereof). Except as otherwise specifically provided for in the Loan Documents, the Obligations and Secured Obligations (each as defined in the Existing First Lien Credit Agreement) shall, on and after the effectiveness of this Agreement, constitute Obligations and Secured Obligations under this Agreement. Without limiting the generality of the foregoing, this Agreement shall not (x) constitute a novation or substitution of the Existing First Lien Credit Agreement, (y) except as otherwise specifically provided for in the Loan Documents, extinguish the Credit Extensions outstanding under the Existing First Lien Credit Agreement or any Guarantees or other obligations for the payment of money outstanding under any Loan Document, or (z) release the Liens granted under any Security Document or affect the priority thereof. Except as otherwise specifically provided for in the Loan Documents, nothing contained or implied herein shall be construed as a release or other discharge of any Credit Party or any of its Subsidiaries under any Loan Document from any of its obligations and liabilities, all of which are hereby ratified and confirmed in all respects (as amended hereby and by any substantially concurrent amendment to any such other Loan Document). Except as expressly provided herein or in any other Loan Document, all terms and conditions of the Loan Documents remain in full force and effect unless otherwise specifically amended hereby or by any other Loan Document.
Section 10.07 Severability. Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.
Section 10.08 Right of Setoff. If an Event of Default shall have occurred and be continuing, each Lender, the Issuing Bank, and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable Requirements of Law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time due and owing by such Lender, the Issuing Bank or any such Affiliate to or for the credit or the account of the Borrower or any other Credit Party (but excluding amounts held in payroll, employee benefits, tax and other fiduciary or trust accounts) against any and all of the obligations of the Borrower or such Credit Party now or hereafter existing under this Agreement or any other Loan Document to such Lender or the Issuing Bank, irrespective of whether or not such Lender or the Issuing Bank shall have made any demand under this Agreement or any other Loan Document and although such obligations of the Borrower or such Credit Party may be contingent or unmatured or are owed to a branch or office of such Lender or the Issuing Bank different from the branch or office holding such deposit or obligated on such indebtedness. The rights of each Lender, the Issuing Bank and their respective Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff) that such Lender, the Issuing Bank or their respective Affiliates may have. Each Lender and the Issuing Bank agrees to notify the Borrower and the Administrative Agent promptly after any such setoff and application; provided that the failure to give such notice shall not affect the validity of such setoff and application.
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Section 10.09 Governing Law; Jurisdiction; Consent to Service of Process.
(a) Governing Law. This Agreement shall be construed in accordance with and governed by the law of the State of New York.
(b) Submission to Jurisdiction. Each party hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of the Supreme Court of the State of New York sitting in the Borough of Manhattan in the State of New York and of the United States District Court of the Southern District of New York sitting in Borough of Manhattan in the State of New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to any Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State court or, to the fullest extent permitted by applicable Requirements of Law, in such Federal court. Each of the parties hereto agrees that a final judgment in any such action 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 or any other Loan Document shall affect any right that the Administrative Agent, the Collateral Agent, the Issuing Bank or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against any Credit Party or its properties in the courts of any jurisdiction.
(c) Waiver of Venue. Each party hereto hereby irrevocably and unconditionally waives, to the fullest extent permitted by applicable Requirements of Law, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in Section 10.09(b). Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by applicable Requirements of 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 irrevocably consents to service of process in any action or proceeding arising out of or relating to any Loan Document, in the manner provided for notices (other than telecopier) in Section 10.01. Nothing in this Agreement or any other Loan Document will affect the right of any party hereto to serve process in any other manner permitted by applicable Requirements of Law.
Section 10.10 Waiver of Jury Trial. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE REQUIREMENTS OF 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, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO
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REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) 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.
Section 10.11 Headings. Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.
Section 10.12 Treatment of Certain Information; Confidentiality. Each of the Administrative Agent, the Lenders and the Issuing Bank agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (in each case, other than to a Disqualified Institution) (a) to its Affiliates and to its and its Affiliates respective partners, directors, officers, employees, agents, advisors, numbering, administration and settlement services provider and other representatives (it being understood that the persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any Governmental Authority or regulatory authority (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent compelled by legal process in, or reasonably necessary to, the defense of such legal, judicial or administrative proceeding, in any legal, judicial or administrative proceeding or otherwise as required by applicable Requirements of Law, (d) to any other party hereto, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, but only to the extent required in connection with such exercise or enforcement, (f) subject to an agreement containing provisions substantially the same as those of this Section 10,12, to (i) any assignee of or Participant in, or any prospective assignee of or Participant (except, in each case, for the avoidance of doubt, for any Disqualified Institution) in, any of its rights or obligations under this Agreement and in connection with any pledge or assignment made pursuant to Section 10.04(f), (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to the Borrower and its obligations or (iii) any rating agency for the purpose of obtaining a credit rating applicable to any Credit Party or to the credit facilities hereunder, (g) with the prior consent of the Borrower or (h) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section or (y) becomes available to the Administrative Agent, any Lender, the Issuing Bank or any of their respective Affiliates on a nonconfidential basis from a source other than the Borrower; provided that with respect to clauses (b) and (c) above, if the Administrative Agent, any Lender or the Issuing Bank receives a subpoena, interrogatory or other request (verbal or otherwise) for any Information, or believes that it is legally required to disclose any of the Information to a third party, it shall, in advance of such disclosure, to the extent legally permissible and unless such disclosure is made to regulatory or self-regulatory authorities in the course of routine audits and reviews, promptly provide to the Borrower written notice of any such request or requirement so that the Borrower or the applicable Credit Party (or Subsidiary thereof) may seek a protective order or other remedy. For purposes of this Section, Information means all information received from Holdings or any of its Subsidiaries relating to Holdings or any of its Subsidiaries
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or any of their respective businesses. Except with respect to disclosing any Information to any Disqualified Institution, any person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such person has exercised the same degree of care to maintain the confidentiality of such Information as such person would accord to its own confidential information.
Section 10.13 USA PATRIOT Act Notice. Each Lender that is subject to the Patriot Act and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Borrower that pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies the Credit Parties, which information includes the name and address of the Credit Parties and other information that will allow such Lender or the Administrative Agent, as applicable, to identify the Credit Parties in accordance with the Patriot Act. The Borrower shall, promptly following a request by the Administrative Agent or any Lender, provide all documentation and other information that the Administrative Agent or such Lender requests that is required in order to comply with its ongoing obligations under applicable know your customer and anti-money laundering rules and regulations, including the Patriot Act.
Section 10.14 Interest Rate Limitation. Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts which are treated as interest on such Loan under applicable Requirements of Law (collectively, the Rate Charges), shall exceed the maximum lawful rate (the Maximum Rate) which may be contracted for, charged, taken, received or reserved by the Lender holding such Loan in accordance with applicable Requirements of Law, the rate of interest payable in respect of such Loan hereunder, together with all Rate Charges payable in respect thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Rate Charges that would have been payable in respect of such Loan but were not payable as a result of the operation of this Section shall be cumulated and the interest and Rate Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Rate to the date of repayment, shall have been received by such Lender.
Section 10.15 Obligations Absolute. To the fullest extent permitted by applicable Requirements of Law, all obligations of the Credit Parties hereunder shall be absolute and unconditional irrespective of:
(a) any bankruptcy, insolvency, reorganization, arrangement, readjustment, composition, liquidation or the like of any Credit Party;
(b) any lack of validity or enforceability of any Loan Document or any other agreement or instrument relating thereto against any Credit Party;
(c) any change in the time, manner or place of payment of, or in any other term of, all or any of the Obligations, or any other amendment or waiver of or any consent to any departure from any Loan Document or any other agreement or instrument relating thereto;
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(d) any exchange, release or non-perfection of any other Collateral, or any release or amendment or waiver of or consent to any departure from any guarantee, for all or any of the Obligations;
(e) any exercise or non-exercise, or any waiver, of any right, remedy, power or privilege under or in respect hereof or any Loan Document; or
(f) any other circumstances that might otherwise constitute a defense (other than the indefeasible payment in full of the Obligations (other than contingent indemnification obligations and unasserted expense reimbursement obligations)) available to, or a discharge of, the Credit Parties.
Section 10.16 No Advisory or Fiduciary Responsibility. In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), the Borrower and each other Credit Party acknowledges and agrees, and acknowledges its Affiliates understanding, that: (i)(A) the arranging and other services regarding this Agreement provided by the Administrative Agent, the Lead Arrangers and the Lenders are arms-length commercial transactions between the Borrower, each other Credit Party and their respective Affiliates, on the one hand, and the Administrative Agent, the Lead Arrangers, and the Lenders, on the other hand, (B) each of the Borrower and the other Credit Parties has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (C) the Borrower and each other Credit Party is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; (ii)(A) the Administrative Agent, the Lead Arrangers and each Lender is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Borrower, any other Credit Party or any of their respective Affiliates, or any other Person, and (B) neither the Administrative Agent, the Lead Arrangers nor any Lender has any obligation to the Borrower, any other Credit Party or any of their respective Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii) the Administrative Agent, the Lead Arrangers and the Lenders and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Borrower, the other Credit Parties and their respective Affiliates, and neither the Administrative Agent, the Lead Arrangers nor any Lender has any obligation to disclose any of such interests to the Borrower, any other Credit Party or any of their respective Affiliates. To the fullest extent permitted by law, the Borrower and each other Credit Party hereby waives and releases any claims that it may have against the Administrative Agent, the Lead Arrangers or any Lender with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.
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Section 10.17 Intercreditor Agreement.
(a) Notwithstanding anything to the contrary in this Agreement or in any other Loan Document: (a) the Liens granted to the Collateral Agent in favor of the Secured Parties pursuant to the Loan Documents and the exercise of any right related to any Collateral shall be subject, in each case, to the terms of any applicable Intercreditor Agreement, (b) in the event of any conflict between the express terms and provisions of this Agreement or any other Loan Document, on the one hand, and of any applicable Intercreditor Agreement, on the other hand, the terms and provisions of such Intercreditor Agreement shall control, and (c) each Lender authorizes the Administrative Agent and/or the Collateral Agent to execute any such Intercreditor Agreement on behalf of such Lender, and such Lender agrees to be bound by the terms thereof.
(b) Each Secured Party hereby agrees that the Administrative Agent and/or Collateral Agent may enter into any intercreditor agreement and/or subordination agreement pursuant to, or contemplated by, the terms of this Credit Agreement (including with respect to Indebtedness permitted pursuant to Section 6.01 and defined terms referenced therein) on its behalf and agrees to be bound by the terms thereof and, in each case, consents and agrees to the appointment of GS (or its affiliated designee, representative or agent) on its behalf as collateral agent thereunder.
Section 10.18 Acknowledgement and Consent to Bail-In of EEA Financial Institutions. Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:
(a) the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and
(b) the effects of any Bail-In Action on any such liability, including, if applicable:
(i) a reduction in full or in part or cancellation of any such liability;
(ii) a conversion of all or a portion of such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or
(iii) the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.
Section 10.19 Electronic Execution of Assignments and Certain Other Documents. The words execute, execution, signed, signature, and words of like import in or related to any document to be signed in connection with this Agreement and the transactions contemplated hereby (including, without limitation, Assignment and Assumptions, Borrowing Requests, Interest Election Requests, amendments or other modifications, waivers and consents) shall be deemed to include electronic signatures, the electronic matching of assignment terms and contract formations on electronic platforms approved by the
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Administrative Agent, or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable Requirement of Law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act; provided that, notwithstanding anything contained herein to the contrary, the Administrative Agent is under no obligation to agree to accept electronic signatures in any form or in any format unless expressly agreed to by the Administrative Agent pursuant to procedures approved by it.
[THIS SPACE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written.
PAPAY HOLDCO, LLC, | ||
a Delaware limited liability company | ||
CVENT, INC., | ||
a Delaware corporation | ||
By: |
/s/ Cynthia A. Russo |
|
Name: | Cynthia A. Russo | |
Title: | Chief Financial Officer | |
CROWDCOMPASS, L.L.C., | ||
a Delaware limited liability company | ||
CVENT ATLANTA, LLC, | ||
a Delaware limited liability company | ||
CVENT ONARRIVAL, INC., | ||
a Delaware corporation | ||
ELITE MEETINGS INTERNATIONAL, LLC, a Delaware limited liability company |
||
GENIECONNECT, INC., | ||
a Delaware corporation | ||
LANYON SOLUTIONS, INC., | ||
a Delaware corporation | ||
LANYON, INC., | ||
a Delaware corporation | ||
MERCURY HOLDING, LLC, | ||
a Delaware limited liability company | ||
SIGNUP4 MOBILE, LLC, | ||
a Georgia limited liability company | ||
S1GNUP4, LLC, | ||
a Delaware limited liability company | ||
STARC1TE, INC., | ||
a Delaware corporation | ||
SU4-WORKTOPIA, LLC, | ||
a Georgia limited liability company | ||
UVERSA INTERNATIONAL, INC., | ||
a Virginia corporation | ||
By: |
/s/ Cynthia A. Russo |
|
Name: | Cynthia A. Russo | |
Title: | Chief Financial Officer |
[Signature Page to Amended and Restated Credit Agreement]
CROWDTORCH LLC, | ||
a Delaware limited liability company | ||
By: |
/s/ Nitin Malhotra |
|
Name: | Nitin Malhotra | |
Title: | President |
[Signature Page to Amended and Restated Credit Agreement]
Exhibit 10.11
EXECUTION VERSION
FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
This FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT, dated as of April 16, 2021 (this Agreement), by and among Cvent, Inc., a Delaware corporation (the Borrower), Papay Holdco, LLC, a Delaware limited liability company (Holdings), the other Credit Parties party hereto, the Extending Lenders (as defined below) party hereto, the Issuing Bank, the Swing Line Lender, and Goldman Sachs Bank USA, as administrative agent (in such capacity, together with its successors and assigns, the Administrative Agent) for the Lenders. This Agreement shall constitute a Loan Document for all purposes of the Amended Credit Agreement (as defined below) and the other Loan Documents. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the Amended Credit Agreement.
RECITALS:
WHEREAS, reference is hereby made to that certain Amended and Restated Credit Agreement, dated as of November 30, 2017 (as amended by that certain Incremental Facility Assumption Agreement No. 1, dated as of October 16, 2018, and that certain Incremental Facility Assumption Agreement No. 2, dated as of October 26, 2018 and as further amended, restated, amended and restated, supplemented or otherwise modified prior to the date hereof, the Credit Agreement, and as amended by this Agreement, the Amended Credit Agreement), by and among the Borrower, Holdings, the other Credit Parties party thereto from time to time, the financial institutions from time to time party thereto as lenders, the Issuing Banks, the Swing Line Lender, the Collateral Agent and the Administrative Agent;
WHEREAS, pursuant to and in accordance with Section 2.21 of the Credit Agreement, the Borrower has requested that each Revolving Lender extend the Revolving Maturity Date (as defined in the Credit Agreement) and to make certain other changes and modifications to the Credit Agreement as are set forth in Section I of this Agreement;
WHEREAS, the Administrative Agent and each Revolving Lender party hereto (constituting all Revolving Lenders under the Credit Agreement) (such Revolving Lenders, the Extending Lenders) are willing to extend the Revolving Maturity Date and to make such changes and modifications to the Credit Agreement on the terms and subject to the conditions set forth below; and
WHEREAS, pursuant to and in accordance with Section 10.02 of the Credit Agreement, the parties hereto have agreed to amend the Credit Agreement as set forth in Section I of this Agreement.
NOW, THEREFORE, in consideration of the premises and agreements, provisions and covenants herein contained, the parties hereto agree as follows:
SECTION I Amendments to the Credit Agreement. The Credit Parties, the Administrative Agent and the Revolving Lenders party hereto agree that on the First Amendment Effective Date, the Credit Agreement is hereby amended as follows:
(a) Section 1.01 of the Credit Agreement is hereby amended by inserting the following new definitions therein in appropriate alphabetical order:
First Amendment Effective Date shall mean April 16, 2021.
Interest Coverage Covenant means the financial covenant set forth in Section 6.08(b)(i).
Interest Coverage Covenant Default has the meaning assigned to such term in Section 6.08(b)(i)(A).
Interest Coverage Cure Amount has the meaning assigned to such term in Section 6.08(b)(i)(A).
Interest Coverage Cure Expiration Date has the meaning assigned to such term in Section 6.08(b)(i)(A).
Interest Coverage Cure Quarter has the meaning assigned to such term in Section 6.08(b)(i)(A).
Interest Coverage Equity Cure Contribution has the meaning assigned to such term in Section 6.08(b)(i)(A).
Interest Coverage Notice of Intent to Cure has the meaning assigned to such term in Section 6.08(b)(i)(A).
Liquidity means, as of any date of determination, the sum of (a) Unrestricted Cash, and (b)(x) the aggregate amount of Revolving Commitments minus (y) the Revolving Exposure of all Lenders.
Liquidity Covenant means the financial covenant set forth in Section 6.08(b)(ii)(A).
Liquidity Covenant Default has the meaning assigned to such term in Section 6.08(b)(ii)(A).
Liquidity Cure Amount has the meaning assigned to such term in Section 6.08(b)(ii)(A).
Liquidity Cure Expiration Date has the meaning assigned to such term in Section 6.08(b)(ii)(A).
Liquidity Cure Quarter has the meaning assigned to such term in Section 6.08(b)(ii)(A).
Liquidity Equity Cure Contribution has the meaning assigned to such term in Section 6.08(b)(ii)(A).
Liquidity Notice of Intent to Cure has the meaning assigned to such term in Section 6.08(b)(ii)(A).
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Liquidity Report has the meaning assigned to such term in Section 6.08(b)(ii)(B).
Liquidity Reporting Date has the meaning assigned to such term in Section 6.08(b)(ii)(B).
Revolving Maturity Date shall mean (x) with respect to the Revolving Commitments as of the First Amendment Effective Date, August 30, 2024, and (y) with respect to any Extended Tranche of Revolving Commitments, the final maturity date specified in the applicable Extension Election accepted by the respective Lender or Lenders.
(b) Section 6.08 of the Credit Agreement is hereby amended and restated in its entirety as follows:
Section 6.08 Financial Covenants. Except with the written consent of the Required Revolving Lenders and subject to the last paragraph of this Section 6.08,
(a) permit the First Lien Leverage Ratio as of the last day of and for any Test Period ended prior to the First Amendment Effective Date to be greater than 7.20 to 1.00; provided that this Section 6.08(a) shall only be in effect (for the avoidance of doubt, solely prior to the First Amendment Effective Date and) when the aggregate principal amount of outstanding Revolving Loans, Swing Line Loans, Reimbursement Obligations and (solely to the extent in excess of $7,500,000 in the aggregate) outstanding but undrawn Letters of Credit that have not been cash collateralized in accordance with the terms of this Agreement exceed 35% of the aggregate Revolving Commitments of all Lenders as of the last day of such Test Period, commencing with the first full fiscal quarter of Holdings commencing after the Closing Date (it being understood that calculation of compliance with this Section 6.08(a) shall be determined as of the last day of and for each applicable Test Period); and
(b) from and after the First Amendment Effective Date:
(i) permit the Consolidated Interest Coverage Ratio as of the last day of and for any Test Period ended after the First Amendment Effective Date to be less than 1.50 to 1.00; provided that this Section 6.08(b)(i) shall only be in effect when the aggregate principal amount of outstanding Revolving Loans, Swing Line Loans, Reimbursement Obligations and (solely to the extent in excess of $7,500,000 in the aggregate) outstanding but undrawn Letters of Credit that have not been cash collateralized in accordance with the terms of this Agreement exceed 35% of the aggregate Revolving Commitments of all Lenders as of the last day of such Test Period, commencing with the first fiscal quarter of Holdings ending after the First Amendment Effective Date (it being understood that calculation of compliance with this Section 6.08(b)(i) shall be determined as of the last day of and for each applicable Test Period); provided that:
(A) In the event that the Credit Parties fail to comply with the Interest Coverage Covenant (an Interest Coverage Covenant Default) for any Fiscal Quarter (an Interest Coverage Cure Quarter), the then existing direct or indirect equity holders of Holdings shall have the right to
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make an equity investment, directly or indirectly, (which equity contribution shall not be Disqualified Capital Stock) in Holdings in cash, which Holdings shall contribute, directly or indirectly, to the Borrower in cash (which equity contribution shall not be Disqualified Capital Stock) on or after the first day of such Interest Coverage Cure Quarter and on or prior to the fifteenth Business Day after the date on which financial statements are required to be delivered pursuant to Section 5.01(a) or (b), as applicable, with respect to such Interest Coverage Cure Quarter or the fiscal year ending on the last day of such Interest Coverage Cure Quarter, as applicable (the Interest Coverage Cure Expiration Date), and such amounts, together with any Eligible Equity Issuances that have been included in clause (c) of the Cumulative Amount (to the extent Not Otherwise Applied), in each case, if so designated by Holdings, shall be included in the calculation of Consolidated EBITDA for purposes of determining compliance with the Interest Coverage Covenant as of the end of and for the Test Period ending on the last day of such Interest Coverage Cure Quarter and any Test Periods ending on the last day of any of the subsequent three fiscal quarters (any such equity contribution so included in the calculation of Consolidated EBITDA, an Interest Coverage Equity Cure Contribution and the amount of such Interest Coverage Equity Cure Contribution, the Interest Coverage Cure Amount); provided that such Interest Coverage Equity Cure Contribution is Not Otherwise Applied (other than, for the avoidance of doubt pursuant to this Section 6.08(b)(i)(A)); provided further that the provisions of Section 6.08(b)(ii)(A) and Section 8.03 shall not apply to any Interest Coverage Covenant Default. All Interest Coverage Equity Cure Contributions shall be (x) disregarded for all purposes of this Agreement other than inclusion in the calculation of Consolidated EBITDA for the purpose of determining compliance with the Interest Coverage Covenant as of the end of and for the Test Period ending on the last day of such Interest Covenant Cure Quarter and any Test Periods ending on the last day of any of the subsequent three fiscal quarters, including being disregarded for purposes of the determination of the Cumulative Amount and all components thereof and any baskets or other ratios with respect to the covenants contained in Article VI (other than this Section 6.08(b)(i)(A)) and (y) deemed used pursuant to clause (iv) of the definition of Not Otherwise Applied (assuming for all such purposes that the reference therein to Section 8.03(a) shall mean a reference to this Section 6.08(b)(i)(A)). Notwithstanding anything to the contrary contained in this Section 6.08(b)(i)(A), (A) upon receipt of the Interest Coverage Cure Amount by Holdings (and the subsequent contribution in cash to the Borrower (which equity contribution shall not be Disqualified Capital Stock in the Borrower)) in at least the amount necessary to cause the Borrower to be in compliance with the Interest Coverage Covenant as of the end of and for the Test Period ending on the last day of such Interest Coverage Cure Quarter, the Interest Coverage Covenant shall be deemed satisfied and complied with as of the end of and for such Test Period with the same effect
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as though there had been no failure to comply with the Interest Coverage Covenant, and any Default or Event of Default related to any failure to comply with the Interest Coverage Covenant shall be deemed not to have occurred for purposes of the Loan Documents, and (B) upon receipt by the Administrative Agent of a notice from the Borrower (an Interest Coverage Notice of Intent to Cure) and through the Interest Coverage Cure Expiration Date: (i) no Default or Event of Default shall be deemed to have occurred on the basis of any failure to comply with the Interest Coverage Covenant unless such failure is not cured by the making of an Interest Coverage Equity Cure Contribution on or prior to the Interest Coverage Cure Expiration Date, (ii) the Borrower shall not be permitted to borrow Revolving Loans or Swing Line Loans and Letters of Credit shall not be issued or renewed unless and until the Interest Coverage Equity Cure Contribution is made or all existing Events of Default are waived or cured, (iii) none of the Administrative Agent, the Collateral Agent or any Lender shall exercise any of the remedial rights otherwise available to it upon an Event of Default, including the right to accelerate the Loans, to terminate Commitments or to foreclose on the Collateral solely on the basis of an Event of Default having occurred as a result of a violation of the Interest Coverage Covenant, unless the Interest Coverage Equity Cure Contribution is not made on or before the Interest Coverage Cure Expiration Date and (iv) if the Interest Coverage Equity Cure Contribution is not made on or before the Interest Coverage Cure Expiration Date, such Event of Default or potential Event of Default shall spring into existence after such time and the Administrative Agent, the Collateral Agent and any Lender may take any actions or remedies pursuant to this Agreement and the other Loan Documents. No Interest Coverage Equity Cure Contribution shall be any greater than the minimum amount required for the Borrower to be in compliance with the Interest Coverage Covenant in the applicable Interest Coverage Cure Quarter. For the avoidance of doubt, any Interest Coverage Equity Cure Contribution and any Interest Coverage Equity Cure Amount shall for all purposes of this Agreement, be treated as an Equity Cure Contribution or Equity Cure Amount, as applicable. Furthermore, notwithstanding anything to the contrary in Section 8.03, on and after the First Amendment Effective Date, other than for purposes of Section 8.03, all references to the Financial Covenant in this Agreement shall include the Interest Coverage Covenant.
(B) There shall be no more than five Interest Coverage Equity Cure Contributions made during the term of this Agreement and no more than two Interest Coverage Equity Cure Contributions made during any four consecutive fiscal quarters. No Interest Coverage Equity Cure Contribution shall be any greater than the minimum amount required for the Borrower to be in compliance with the Interest Coverage Covenant in the applicable Interest Coverage Cure Quarter including, without limitation, for purposes of calculating any amounts to be added back to Consolidated EBITDA pursuant to clause (o) of the definition thereof.
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(ii) permit Liquidity as of the last day of any Test Period commencing with the Fiscal Quarter ending June 30, 2021, to be less than $25,000,000; provided that:
(A) In the event that the Credit Parties fail to comply with the Liquidity Covenant (a Liquidity Covenant Default) for any Fiscal Quarter (a Liquidity Cure Quarter), the then existing direct or indirect equity holders of Holdings shall have the right to make an equity investment, directly or indirectly, (which equity contribution shall not be Disqualified Capital Stock) in Holdings in cash, which Holdings shall contribute, directly or indirectly, to the Borrower in cash (which equity contribution shall not be Disqualified Capital Stock) on or after the last day of such Liquidity Cure Quarter and on or prior to the day that is five (5) Business Days after the Liquidity Reporting Date with respect to such Liquidity Cure Quarter (the Liquidity Cure Expiration Date), and such amounts shall be included in the calculation of Unrestricted Cash for the purposes of determining compliance with the Liquidity Covenant (any such equity contribution so included in the calculation of Unrestricted Cash, a Liquidity Equity Cure Contribution and the amount of such Liquidity Equity Cure Contribution, the Liquidity Cure Amount); provided that such Liquidity Equity Cure Contribution is Not Otherwise Applied (other than, for the avoidance of doubt pursuant to this Section 6.08(b)(ii)(A)); provided further that the provisions of Section 6.08(b)(i)(A) and Section 8.03 shall not apply to any Liquidity Covenant Default. All Liquidity Equity Cure Contributions shall be (x) disregarded for all purposes of this Agreement other than inclusion in the calculation of Liquidity for the purpose of determining compliance with the Liquidity Covenant as of the end of the Liquidity Cure Quarter, including being disregarded for purposes of the determination of the Cumulative Amount and all components thereof and any baskets or other ratios with respect to the covenants contained in Article VI (other than this Section 6.08(b)(ii)(A)) and (y) deemed used pursuant to clause (iv) of the definition of Not Otherwise Applied (assuming for all such purposes that the reference therein to Consolidated EBITDA shall mean a reference to Liquidity and the reference therein to Section 8.03(a) shall mean a reference to this Section 6.08(b)(ii)(A)); provided that any cash so contributed may be counted as Unrestricted Cash for any purpose at any time that such cash otherwise qualified as Unrestricted Cash. Notwithstanding anything to the contrary contained in this Section 6.08(b)(ii)(A), (A) upon receipt of the Liquidity Cure Amount by Holdings (and the subsequent contribution in cash to the Borrower (which equity contribution shall not be Disqualified Capital Stock in the Borrower)) in at least the amount necessary to cause the Borrower to be in compliance with the Liquidity Covenant as of the end of the Liquidity Cure Quarter, the Liquidity Covenant shall be deemed satisfied and complied with as of the end of the Liquidity Cure Quarter with the same effect as though there had been no failure to comply with the Liquidity Covenant, and any Default or Event of Default related to any failure to comply with
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the Liquidity Covenant shall be deemed not to have occurred for purposes of the Loan Documents, and (B) upon receipt by the Administrative Agent of a notice from the Borrower (a Liquidity Notice of Intent to Cure) and through the Liquidity Cure Expiration Date: (i) no Default or Event of Default shall be deemed to have occurred on the basis of any failure to comply with the Liquidity Covenant unless such failure is not cured by the making of a Liquidity Equity Cure Contribution on or prior to the Liquidity Cure Expiration Date, (ii) the Borrower shall not be permitted to borrow Revolving Loans or Swing Line Loans and Letters of Credit shall not be issued or renewed unless and until the Liquidity Equity Cure Contribution is made or all existing Events of Default are waived or cured, (iii) none of the Administrative Agent, the Collateral Agent or any Lender shall exercise any of the remedial rights otherwise available to it upon an Event of Default, including the right to accelerate the Loans, to terminate Commitments or to foreclose on the Collateral solely on the basis of an Event of Default having occurred as a result of a violation of the Liquidity Covenant, unless the Liquidity Equity Cure Contribution is not made on or before the Liquidity Cure Expiration Date and (iv) if the Liquidity Equity Cure Contribution is not made on or before the Liquidity Cure Expiration Date, such Event of Default or potential Event of Default shall spring into existence after such time and the Administrative Agent, the Collateral Agent and any Lender may take any actions or remedies pursuant to this Agreement and the other Loan Documents. No Liquidity Equity Cure Contribution shall be any greater than the minimum amount required for the Borrower to be in compliance with the Liquidity Covenant in the applicable Liquidity Cure Quarter. For the avoidance of doubt, any Liquidity Equity Cure Contribution and any Liquidity Equity Cure Amount shall for all purposes of this Agreement, be treated as an Equity Cure Contribution or Equity Cure Amount, as applicable. Furthermore, notwithstanding anything to the contrary in Section 8.03, on and after the First Amendment Effective Date, other than for purposes of Section 8.03, all references to the Financial Covenant in this Agreement shall include the Liquidity Covenant.
(B) The Borrower covenants and agrees that, not later than the tenth (10th) Business Day after the last day of each Fiscal Quarter ending after the First Amendment Effective Date (each such date, a Liquidity Reporting Date) (or such longer timeframe agreed to by the Required Revolving Lenders), it shall furnish to the Administrative Agent (for distribution to the Revolving Lenders) a report setting forth the calculations evidencing compliance with the Liquidity Covenant as of the last day of such Fiscal Quarter, as certified on behalf of the Borrower by a Responsible Officer of the Borrower (a Liquidity Report);
(iii) notwithstanding the definition of Maximum Incremental Facilities Amount or Fixed Incremental Amount, incur any Incremental Facilities or Permitted Incremental Equivalent Debt, in each case, in reliance on clause (i)(A) of the definition of Maximum Incremental Facilities Amount in an aggregate principal amount exceeding the greater of (x) $100 million and (y) 75% of Consolidated EBITDA for the most recent Test Period;
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(iv) notwithstanding the definition of Maximum Incremental Facilities Amount or Incurrence Ratio or Section 6.01(u), incur any (x) Incremental Facilities or Permitted Incremental Equivalent Debt that is, in each case, incurred in reliance upon clause (ii) of the definition of Maximum Incremental Facilities Amount and secured on a pari passu basis with the Secured Obligations or (y) Senior Secured Indebtedness under Section 6.01(u), unless on a Pro Forma Basis as of the Applicable Date of Determination and for the applicable Test Period, determined after giving effect to the incurrence of any such Incremental Facility, any such Permitted Incremental Equivalent Debt or any such Senior Secured Indebtedness and any Permitted Acquisition or other acquisition consummated in connection therewith, any Indebtedness repaid with the proceeds thereof and any Investment, disposition or debt incurrence in connection therewith and all other pro forma adjustments, the First Lien Leverage Ratio does not exceed 4.00:1.00;
(v) notwithstanding anything to the contrary herein, permit any Indebtedness that is incurred by any Subsidiary or joint venture that is not, in each case, a Credit Party (to the extent permitted to be incurred hereunder) to be guaranteed by a Credit Party or otherwise be recourse to a Credit Party or any of its assets or properties;
(vi) notwithstanding anything to the contrary herein, permit the calculation of Consolidated EBITDA to include the adjustments referred to in clause (f)(y) of the definition thereof unless (x) such run rate cost savings, operating expense reductions, other operating improvements and initiatives and synergies are projected by the Borrower to result from actions either taken or expected to be taken in connection with, and within 12 months following the transactions referred to therein and (y) such adjustments otherwise comply with the terms and conditions set forth in such clause (f)(y);
(vii) notwithstanding the proviso set forth in clause (ii) of Section 6.06(o), make any Dividends in reliance upon Section 6.06(o) unless (x) on a Pro Forma Basis, the First Lien Leverage Ratio as of the Applicable Date of Determination and for the most recently ended Test Period is no greater than 3.50 to 1.00 and (y) the making of such Dividends otherwise complies with the terms and conditions set forth in Section 6.06(o);
(viii) notwithstanding Section 6.09(a)(J), make any prepayments of indebtedness in reliance upon Section 6.09(a)(J) unless (x) on a Pro Forma Basis, the First Lien Leverage Ratio as of the Applicable Date of Determination and for the most recently ended Test Period is no greater than 3.50 to 1.00 and (y) the making of such prepayment otherwise complies with the terms and conditions set forth in Section 6.09(a)(J);
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(ix) notwithstanding anything to the contrary herein, make any Investments in reliance upon Section 6.03(x), unless (x) such Investments are made in a Credit Party (including, for the avoidance of doubt, any entity that becomes a Credit Party in connection with such Investment) and (y) the making of such Investments otherwise complies with the terms and conditions set forth in Section 6.03(x); and
(x) notwithstanding anything to the contrary herein, consummate any of the following transactions unless, in each case, (x) on a Pro Forma Basis, the First Lien Leverage Ratio as of the Applicable Date of Determination and for the most recently ended Test Period, is no greater than 3.50 to 1.00 and (y) the consummation of such transaction otherwise complies with the terms and conditions set forth in the provision(s) with respect thereto:
(A) make any Dividends in reliance on Section 6.06(j) or otherwise reallocate availability thereunder to make Investments under Section 6.03(y) or prepayments of Indebtedness under Section 6.09(a)(I);
(B) make any prepayments of indebtedness in reliance on Section 6.09(a)(I) or otherwise reallocate availability thereunder to make Investments under Section 6.03(y);
(C) make (A) any Dividends under Section 6.06(f) or (B) any prepayments of indebtedness pursuant to Section 6.09(a)(A), in each case, in reliance on clause (b) of the definition of Cumulative Amount;
(D) make any Investments in any Restricted Subsidiary that is not a Subsidiary Guarantor in reliance on Section 6.03(f)(iii);
(E) make any Investments in, or designate any Subsidiary as, an Unrestricted Subsidiary, whether in reliance on Section 6.03(s) or otherwise; or
(F) make (x) any Dividends under Section 6.06(f) or (y) any prepayments of indebtedness pursuant to Section 6.09(a)(A), in each case, in reliance on clause (a) of the definition of Cumulative Amount.
The provisions of this Section 6.08 are for the benefit of the Revolving Lenders only.
SECTION II Conditions Precedent.
(a) The effectiveness of this Agreement is subject to the satisfaction of the following conditions (the date on which such conditions are satisfied, the First Amendment Effective Date):
(i) |
this Agreement shall have been duly executed by the Borrower and each other Credit Party, the Administrative Agent and each Extending Lender; |
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(ii) |
at the time of the effectiveness of this Agreement (and after giving effect to the amendments to the Credit Agreement pursuant to this Agreement), no Default or Event of Default shall have occurred and be continuing; |
(iii) |
the representations and warranties made by the Credit Parties as set forth in Section III(e) hereof shall be true and correct on and as of the First Amendment Effective Date; |
(iv) |
the Administrative Agent shall have received (a) in respect of each Credit Party, a certificate (as is customary in the relevant jurisdiction and containing specimen signatures) of each such Credit Party, dated the First Amendment Effective Date, with appropriate insertions and attachments, including organizational authorizations, constitutional documents, resolutions, incumbency certifications, the certificate of incorporation or other similar organizational document of each such Credit Party, certified (where applicable) by the relevant authority of the jurisdiction or organization of such Credit Party, the bylaws or other similar organizational document of each such Credit Party certified by a Responsible Officer as being in full force and effect on the First Amendment Effective Date (or if such certificate of incorporation (or other similar organizational document) or bylaws (or other similar organizational document) have not been amended or modified since the most recent delivery thereof to the Administrative Agent, certified by a Responsible Officer certifying that such certificate or bylaw has not been amended or modified, and is in full force and effect, since the most recent delivery thereof) and (b) a good standing certificate (long form, to the extent available) for each Credit Party from its jurisdiction of organization (where applicable in such jurisdiction); |
(v) |
the Administrative Agent shall have received a solvency certificate from a Financial Officer of Holdings in the form of Exhibit L of the Credit Agreement, which demonstrates that Holdings and its Subsidiaries on a consolidated basis, are, and after giving effect to this Agreement and the transactions contemplated hereby, will be, Solvent; |
(vi) |
the Borrower shall have paid to each Revolving Lender party hereto, as fee compensation for such Revolving Lenders Revolving Commitment, a closing fee in an amount equal to 0.375 % of the stated principal amount of such Revolving Lenders Revolving Commitment (it being understood and agreed that such closing fee will be in all respects fully earned, due and payable on, and subject to the occurrence of, the First Amendment Effective Date and non-refundable and non-creditable thereafter); |
(vii) |
the Administrative Agent shall have received all costs, fees, expenses (including, without limitation, legal fees and expenses) and other compensation, in each case, required in writing to be paid on the First Amendment Effective Date, in the case of costs and expenses, to the extent invoiced at least three business days prior to the First Amendment Effective Date; |
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(viii) |
the Administrative Agent shall have received at least three (3) Business Days prior to the First Amendment Effective Date all documentation and information as is reasonably requested in writing by the Administrative Agent at least ten (10) days prior to the First Amendment Effective Date about Holdings and its subsidiaries required by U.S. regulatory authorities under applicable know your customer and anti-money laundering rules and regulations, including without limitation the PATRIOT Act and the requirements of 31 C.F.R. § 1010.230; and |
(ix) |
the Administrative Agent shall have received (i) a customary legal opinion of Kirkland & Ellis LLP, special counsel for the Credit Parties and (ii) to the extent reasonably requested by the Administrative Agent, legal opinions consistent with those delivered on the Closing Date under Section 4.01 of the Credit Agreement, which opinions, in each case, shall be in the form and substance reasonably satisfactory to the Administrative Agent. |
SECTION III Representations and Warranties. By its execution of this Agreement, the Credit Parties hereby represent and warrant that, as of the date hereof:
(a) each Credit Party (a) is duly incorporated, organized or formed and validly existing under the laws of the jurisdiction of its incorporation or organization, (b) has all requisite power and authority to carry on its business as now conducted and to own and lease its property, in each case except where the failure to do so would not reasonably be expected to result in a Material Adverse Effect, and (c) is qualified and in good standing (to the extent such concept is applicable in the applicable jurisdiction) to do business in every jurisdiction where such qualification is required, except in such jurisdictions where the failure to so qualify or be in good standing, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect;
(b) subject to any matters which are set out as qualifications or reservations as to matters of law of general application in the legal opinions provided pursuant to Section II(ix), each Credit Party has the power, capacity and authority, and the legal right, to make, deliver and perform this Agreement. Each Credit Party has taken all necessary organizational or corporate action to authorize the execution, delivery and performance of this Agreement and to authorize the Credit Extensions and the other transactions contemplated hereby. This Agreement has been duly executed and delivered on behalf of each Credit Party party hereto. This Agreement constitutes a legal, valid and binding obligation of each Credit Party party hereto, enforceable against each such Credit Party in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, examinership, reorganization, moratorium or similar laws affecting the enforcement of creditors rights generally and by general equitable principles (whether enforcement is sought by proceedings in equity or at law);
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(c) the execution, delivery and performance by the Credit Parties of this Agreement and the Credit Extensions contemplated hereby (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except (i) such as have been obtained or made and are in full force and effect, and (ii) consents, approvals, registrations, filings, permits or actions the failure to obtain or perform which would not reasonably be expected to result in a Material Adverse Effect, (b) will not violate or require consent not obtained under the Organizational Documents of any Group Member, except as would not reasonably be expected to result in a Material Adverse Effect, (c) will not violate or result in a default under any indenture or other material agreement or instrument binding upon any Group Member or any of their assets, or give rise to a right thereunder to require any payment, repurchase or redemption to be made by any Group Member, or give rise to a right of, or result in, termination, cancellation or acceleration of any obligation thereunder, except, in each case, individually or in the aggregate, as would not reasonably be expected to result in a Material Adverse Effect,
(d) will not violate any Requirement of Law except, individually or in the aggregate, as would not reasonably be expected to result in a Material Adverse Effect; and
(e) each of the representations and warranties made by any Credit Party in or pursuant to the Loan Documents are true and correct in all material respects on and as of the First Amendment Effective Date as if made on and as of such date (except to the extent already qualified by materiality, in which case, such representations and warranties shall be true and correct in all respects as of such date), except to the extent such representations and warranties specifically relate to a date prior to the First Amendment Effective Date, in which case such representations and warranties were true and correct in all material respects as of such earlier date (except to the extent already qualified by materiality, in which case, such representations and warranties were true and correct in all respects as of such date).
SECTION IV Confirmation of Guaranties and Security Interests.
(a) To induce the Extending Lenders, the Issuing Bank, the Swing Line Lender and the Administrative Agent to enter into this Agreement, each of the Credit Parties hereby acknowledges and reaffirms its obligations under each Loan Document to which it is a party, including, without limitation, any grant, pledge or collateral assignment of a lien or security interest, as applicable, contained therein, in each case as amended, restated, amended and restated, supplemented or otherwise modified prior to or as of the date hereof (including as amended pursuant to this Agreement) (collectively, the Reaffirmed Documents). The Borrower acknowledges and agrees that each of the Loan Documents to which it is a party or otherwise bound shall continue in full force and effect and that all of its obligations thereunder shall not be impaired or limited by the execution or effectiveness of this Agreement.
(b) In furtherance of Section IV(a), each Credit Party, in its capacity as a Guarantor under any Loan Document constituting a guarantee to which it is a party (in such capacity, each a Reaffirming Loan Guarantor), reaffirms its guarantee of the Guaranteed Obligations under the terms and conditions of such guarantee and agrees that such guarantee remains in full force and effect to the extent set forth in such guarantee and after giving effect to this Agreement, and is hereby ratified, reaffirmed and confirmed. Each Reaffirming Loan Guarantor hereby confirms that it consents to the terms of this Agreement and the Amended Credit Agreement and that the principal of, the interest and premium (if any) on, and fees related to, the Revolving Commitments constitute Obligations under the Loan Documents. Each Reaffirming Loan Guarantor hereby (i)
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acknowledges and agrees that its guarantee and each of the Loan Documents to which it is a party or otherwise bound shall continue in full force and effect and that all of its obligations thereunder shall not be impaired or limited by the execution or effectiveness of this Agreement, (ii) acknowledges and agrees that it will continue to guarantee to the fullest extent possible in accordance with the Loan Documents the payment and performance of all Obligations under each of the Loan Documents to which it is a party (including all such Obligations as amended, reaffirmed and/or increased pursuant to this Agreement) and (iii) acknowledges, agrees and warrants for the benefit of the Administrative Agent, the Collateral Agent and each other Secured Party that there are no rights of set-off or counterclaim, nor any defenses of any kind, whether legal, equitable or otherwise, that would enable such Reaffirming Loan Guarantor to avoid or delay timely performance of its obligations under the Loan Documents.
(c) In furtherance of Section IV(a), each of the Credit Parties that is party to any Security Document, in its capacity as a grantor under such Security Document (in such capacity, each a Reaffirming Grantor), hereby acknowledges that it has reviewed and consents to the terms and conditions of this Agreement and the Credit Extensions and the other transactions contemplated hereby. In addition, each Reaffirming Grantor reaffirms the security interests granted by such Reaffirming Grantor under the terms and conditions of the Security Document and each other Loan Document (in each case, to the extent a party thereto) to secure the Obligations (including all such Obligations as amended, reaffirmed and/or increased pursuant to this Agreement) and agrees that such security interests remain in full force and effect and are hereby ratified, reaffirmed and confirmed. Each Credit Party hereby confirms that the security interests granted by such Reaffirming Grantor under the terms and conditions of the Loan Documents secure the Revolving Loans as part of the Obligations. Each Reaffirming Grantor hereby (i) confirms that each Security Document to which it is a party or is otherwise bound and all Collateral encumbered thereby will continue to secure, to the fullest extent possible in accordance with such Security Document, the payment and performance of the Obligations (including all such Obligations as amended, reaffirmed and/or increased pursuant to this Agreement), as the case may be, including without limitation the payment and performance of all such applicable Obligations that are joint and several obligations of each Reaffirming Grantor and each grantor now or hereafter existing, (ii) confirms its respective grant to the Collateral Agent for the benefit of the Secured Parties of the security interest in and continuing lien on all of such grantors right, title and interest in all Collateral, in each case, whether now owned or hereafter acquired or arising and wherever located, as collateral security for the prompt and complete payment and performance in full when due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise, of all applicable Obligations (including all such Obligations as amended, reaffirmed and/or increased pursuant to this Agreement), subject to the terms contained in the applicable Loan Documents, and (iii) confirms its respective pledges, grants of security interests and other obligations, as applicable, under and subject to the terms of each of the Security Documents to which it is a party.
SECTION V Miscellaneous.
(a) No Novation. By its execution of this Agreement, each of the parties hereto acknowledges and agrees that the terms of this Agreement do not constitute a novation but, rather, an amendment of the terms of a pre-existing Indebtedness and related agreement, as evidenced by the Credit Agreement.
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(b) Amendment, Modification and Waiver. This Agreement may not be amended, modified or waived except by an instrument or instruments in writing signed and delivered on behalf of each of the parties hereto.
(c) Entire Agreement. This Agreement, the Amended Credit Agreement and the other Loan Documents constitute the entire agreement among the parties hereto with respect to the subject matter hereof and thereof and supersede all other prior agreements and understandings, both written and oral, among the parties or any of them with respect to the subject matter hereof.
(d) Governing Law. Section 10.09 (Governing Law; Jurisdiction; Consent to Service of Process) and Section 10.10 (Waiver of Jury Trial) of the Credit Agreement are hereby incorporated by reference, mutatis mutandis.
(e) Severability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
(f) Headings Descriptive. The headings of the several sections and subsections of this Agreement are inserted for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement.
(g) Counterparts. This Agreement may be executed in counterparts, each of which when so executed shall be deemed to be an original and all of which when taken together shall constitute one and the same instrument. Any signature to this Agreement may be delivered by facsimile, electronic mail (including pdf) or any electronic signature complying with the U.S. federal ESIGN Act of 2000 or the New York Electronic Signature and Records Act or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes to the fullest extent permitted by applicable law. For the avoidance of doubt, the foregoing also applies to any amendment, extension or renewal of this agreement. Each of the parties hereto represents and warrants to the other parties that it has the corporate capacity and authority to execute this Agreement through electronic means.
[Signature Pages Follow]
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IN WITNESS WHEREOF, each of the undersigned has caused its duly authorized officer to execute and deliver this Agreement as of the date first listed above.
[Signature Page to First Amendment]
IN WITNESS WHEREOF, each of the undersigned has caused its duly authorized officer to execute and deliver this Agreement as of the date first listed above.
HOLDINGS: | PAPAY HOLDCO, LLC, | |||||
a Delaware limited liability company | ||||||
By: |
/s/ Nicolas Stahl |
|||||
Name: Nicolas Stahl | ||||||
Title: Treasurer | ||||||
BORROWER: | CVENT, INC., | |||||
a Delaware corporation | ||||||
By: |
/s/ William J. Newman, III |
|||||
Name:William J. Newman, III | ||||||
Title:Chief Financial Officer | ||||||
GUARANTORS: | CROWDCOMPASS, L.L.C., | |||||
a Delaware limited liability company |
||||||
CVENT ATLANTA, LLC, | ||||||
a Delaware limited liability company |
||||||
CVENT ONARRIVAL, INC., | ||||||
a Delaware corporation |
||||||
DOUBLEDUTCH, INC., | ||||||
a Delaware corporation |
||||||
ELITE MEETINGS INTERNATIONAL, | ||||||
LLC, | ||||||
a Delaware limited liability company |
||||||
LANYON SOLUTIONS, INC., | ||||||
a Delaware corporation |
||||||
LANYON, INC., | ||||||
a Delaware corporation |
||||||
MERCURY HOLDING, LLC, | ||||||
a Delaware limited liability company |
||||||
SIGNUP4 MOBILE, LLC, | ||||||
a Georgia limited liability company |
||||||
SIGNUP4, LLC, | ||||||
a Delaware limited liability company |
||||||
SOCIAL TABLES, INC., | ||||||
a Delaware corporation |
||||||
STARCITE, INC., | ||||||
a Delaware corporation |
||||||
SU4-WORKTOPIA, LLC, | ||||||
a Georgia limited liability company |
||||||
By: |
/s/ William J. Newman, III |
|||||
Name: | William J. Newman, III | |||||
Title: | Senior Vice President, Finance |
[Signature Page to First Amendment]
Exhibit 10.12
Execution Version
INCREMENTAL FACILITY ASSUMPTION AGREEMENT NO. 1
This INCREMENTAL FACILITY ASSUMPTION AGREEMENT NO. 1 (this Agreement), dated as of October 16, 2018, is made by and among Cvent, Inc., a Delaware corporation (Borrower). Papay Holdco, LLC, a Delaware limited liability company (Holdings), the other Credit Parties party hereto, each of the financial institutions party hereto as lenders (in such capacity, the 2018 Incremental Lenders) and Goldman Sachs Bank USA, as administrative agent (in such capacity, together with its successors and assigns, the Administrative Agent) for the Lenders under, and as defined in, the Credit Agreement (as defined below).
PRELIMINARY STATEMENTS:
(1) The Borrower, the other Credit Parties, the Lenders from time to time party thereto, the Administrative Agent and Goldman Sachs Bank USA, as Collateral Agent for the Secured Parties, as Swing Line Lender and as the Issuing Bank, are party to that certain Amended and Restated Credit Agreement, dated as of November 30, 2017 (as amended, restated, amended and restated, supplemented or otherwise modified prior to the date hereof, the Credit Agreement; as amended by this Agreement, the Amended Credit Agreement). Capitalized terms not otherwise defined in this Agreement have the same meanings as specified in the Amended Credit Agreement;
(2) The Borrower has requested that the 2018 Incremental Lenders collectively provide 2018 Incremental Term Loan Commitments (as defined below), and make 2018 Incremental Term Loans (as defined below) pursuant thereto, in an aggregate principal amount equal to $53,000,000 on the effective date with respect to the 2018 Incremental Term Loans made hereunder (as used herein, the Increase Effective Date) and each 2018 Incremental Lender is prepared to provide a portion of such 2018 Incremental Term Loan Commitments and to provide a portion of the 2018 Incremental Term Loans pursuant thereto, in the respective amounts set forth on Schedule 2.01(a) hereto, in each case subject to the other terms and conditions set forth herein;
(3) The Borrower, Holdings, the other Credit Parties, the 2018 Incremental Lenders and the Administrative Agent are entering into this Agreement in order to evidence such 2018 Incremental Term Loan Commitments and 2018 Incremental Term Loans, which are made in accordance with Section 2.20 of the Credit Agreement and incurred pursuant to the Incurrence Ratio;
(4) The proceeds of the 2018 Incremental Term Loans will be used to (a) finance the acquisition, directly or indirectly, by the Borrower of Social Tables, Inc. (the 2018 Target) (the Acquisition) pursuant to that certain Agreement and Plan of Merger, dated as of October 16, 2018 (the 2018 Acquisition Agreement), by and among Cvent Atlanta, LLC, a Delaware limited liability company, Linebacker Merger Sub, Inc., a Delaware corporation, the 2018 Target and the Equityholders Representative (as defined in the 2018 Acquisition Agreement), (b) pay fees, costs and expenses incurred in connection with this Agreement, the 2018 Acquisition Agreement and the transactions contemplated hereby and thereby, and (c) finance working capital and general corporate purposes;
(5) The Borrower has appointed Goldman Sachs Bank USA, as sole lead arranger (in such capacity, the 2018 Incremental Term Loan Arranger) to arrange the 2018 Incremental Term Loans under this Agreement.
SECTION 1. Incremental Facilities. Pursuant to Section 2.20 of the Credit Agreement, on and as of the Increase Effective Date:
(a) Each 2018 Incremental Lender that is not, prior to the effectiveness of this Agreement, a Term Loan Lender under the Credit Agreement, hereby agrees that upon, and subject to, the occurrence of the Increase Effective Date, such 2018 Incremental Lender shall be deemed to be, and shall become, a Term Loan Lender for all purposes of, and subject to all the obligations of a Term Loan Lender under, the Amended Credit Agreement and the other Loan Documents. Each 2018 Incremental Lender shall have an Incremental Term Loan Commitment that is equal to the amount set forth opposite such 2018 Incremental Lenders name under the heading 2018 Incremental Term Loan Commitments on Schedule 2.01(a) to this Agreement (such commitment hereinafter referred to as the 2018 Incremental Term Loan Commitments). Each Credit Party and the Administrative Agent hereby agree that from and after the Increase Effective Date, each 2018 Incremental Lender shall be deemed to be, and shall become, a Term Loan Lender for all purposes of, and with all of the rights and remedies of a Term Loan Lender under, the Amended Credit Agreement and the other Loan Documents.
(b) Each 2018 Incremental Lender hereby agrees to make 2018 Incremental Term Loans to the Borrower on the Increase Effective Date in a principal amount not to exceed its respective 2018 Incremental Term Loan Commitment set forth on Schedule 2.01(a) to this Agreement.
(c) Section 1.01 of the Credit Agreement is hereby amended by inserting the following new definitions in the appropriate alphabetical order therein:
(i) 2018 Acquisition shall have the meaning assigned to such term in Section 3,11.
(ii) 2018 Acquisition Agreement shall mean that certain Agreement and Plan of Merger, dated as of October 16, 2018 (the 2018 Acquisition Agreement), by and among Cvent Atlanta, LLC, a Delaware limited liability company, Linebacker Merger Sub, Inc., a Delaware corporation, the 2018 Target and the Equityholders Representative.
(iii) 2018 Incremental Lender shall mean any Lender that holds a 2018 Incremental Term Loan Commitment and/or a 2018 Incremental Term Loan outstanding hereunder.
(iv) 2018 Incremental Term Loan Commitment shall mean as to each 2018 Incremental Lender, its obligation to make 2018 Incremental Term Loans to the Borrower on the First Incremental Amendment Date in an aggregate principal amount not to exceed the amount set forth opposite such 2018 Incremental Lenders name on Annex A under the caption 2018 Incremental Term Loan Commitment.
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(v) 2018 Incremental Term Loans shall mean the Term Loans made to the Borrower on the First Incremental Amendment Date in the principal amount of $53,000,000.
(vi) 2018 Target shall mean Social Tables. Inc., a Delaware corporation.
(vii) First Incremental Amendment shall mean that certain Incremental Facility Assumption Agreement No. 1, dated as of October 16, 2018, by and among the Borrower, Holdings, the other Credit Parties party thereto, the 2018 Incremental Lenders party thereto and the Administrative Agent.
(viii) First Incremental Amendment Date shall mean the date on which all the conditions precedent set forth in Section 4 of the First Incremental Amendment shall have been satisfied or waived in accordance with the terms thereof. For the avoidance of doubt, the First Incremental Amendment Date shall be October 16, 2018.
(d) Section 1.01 of the Credit Agreement is hereby amended by adding the following sentence at the end of the definition of Tranche:
Notwithstanding any provision herein to the contrary, the Term Loans made on the Closing Date and the 2018 Incremental Term Loans made on the First Incremental Amendment Date shall be deemed to be, and treated as, part of a single Tranche for all purposes hereunder.
(e) Section 2.09 of the Credit Agreement is hereby amended by replacing the same in full with the following:
Section 2.09 Amortization of Term Loan Borrowings. The Borrower shall pay to the Administrative Agent, for the ratable account of the Term Loan Lenders, on the last Business Day of each March, June, September and December, commencing on the last Business Day of December, 2018 (each such date, a Term Loan Repayment Date), an amount equal to (i) 0.25% in respect of principal of the Term Loans made on the Closing Date and (ii) 0.2512562814% in respect of principal of the 2018 Incremental Term Loans made on the First Incremental Amendment Date, in each case, as adjusted from time to time pursuant to Section 2.10(h), as reduced by the principal amount of Loans contributed or assigned to Holdings or any of its Restricted Subsidiaries pursuant to Section 10.04(b)(vi) or (viii), and as adjusted in connection with the making of any further Incremental Term Loans pursuant to Section 2.20 hereof, together in each case with accrued and unpaid interest on the principal amount to be paid to but excluding the date of such payment. To the extent not previously paid, all Term Loans made on the Closing Date and all 2018 Incremental Term Loans made on the First Incremental Amendment Date shall be due and payable by the Borrower on the Term Loan Maturity Date.
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(f) Section 3.11 of the Credit Agreement is hereby amended by adding the following sentence at the end thereof:
For the avoidance of doubt, the Borrower will (or will direct a Credit Party to) use the proceeds of the 2018 Incremental Term Loans made on the First Incremental Amendment Date, to (i) finance the acquisition by the Borrower of the 2018 Target (the 2018 Acquisition), pursuant to the 2018 Acquisition Agreement, (ii) to repay a portion of the outstanding loans under the Existing Credit Agreement (as defined below), (iii) pay fees, costs and expenses incurred in connection with the First Incremental Amendment and the transactions contemplated thereby, and (iv) finance working capital and general corporate purposes.
(g) The Credit Agreement is hereby amended by inserting as part of Annex A thereto Schedule 2.01(a) attached hereto.
SECTION 2. Terms and Agreements. The 2018 Incremental Term Loans made pursuant to this Agreement shall constitute Term Loans for all purposes of the Amended Credit Agreement and the other Loan Documents, and shall have the same terms as, and be part of the same series as, the Term Loans made prior to the Increase Effective Date.
SECTION 3. Representations and Warranties. Each Credit Party represents and warrants that as of the Increase Effective Date:
(a) The representations and warranties made by any Credit Party set forth in Article III of the Credit Agreement or in any other Loan Document are true and correct in all material respects (except that any representation and warranty that is qualified as to materiality or Material Adverse Effect is true and correct in all respects) on and as of the Increase Effective Date with the same effect as though made on and as of such date, except to the extent that such representation or warranty expressly relates to an earlier date in which case such representations and warranties are true and correct in all material respects (except that any representation and warranty that is qualified as to materiality or Material Adverse Effect is true and correct in all respects) as of such earlier date; and
(b) no Event of Default under Section 8.01(a), (b), (g) or (h) of the Credit Agreement shall have occurred and be continuing at the time of the incurrence of the 2018 Incremental Term Loans made pursuant to this Agreement or immediately after giving effect thereto.
SECTION 4. Conditions to Effectiveness on Increase Effective Date. This Agreement, and the obligations of the 2018 Incremental Lenders to make their respective 2018 Term Loan Commitments, and to fund their respective 2018 Incremental Term Loans, as specified in Section 1 hereof, shall become effective on and as of the Business Day on which the conditions to such 2018 Incremental Term Loans set forth in Sections 2.20(a), (b) and (c) of the Credit Agreement shall have been satisfied (such date, the Increase Effective Date), including:
(a) the Administrative Agent shall have received duly executed counterparts of this Agreement from the Borrower, each other Credit Party and each 2018 Incremental Lender;
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(b) the Administrative Agent shall have received a Borrowing Request for the borrowing of the 2018 Incremental Term Loans to be made pursuant to this Agreement;
(c) the 2018 Acquisition shall have been consummated or, substantially concurrently with the incurrence of the 2018 Incremental Term Loans, shall be consummated, pursuant to the terms of the 2018 Acquisition Agreement;
(d) the Administrative Agent shall have received, on behalf of itself, the Collateral Agent and the Lenders, a customary opinion of Kirkland & Ellis LLP, special counsel to the Borrower and each Credit Party, each dated as of the Increase Effective Date, addressed to the Agents and the Lenders and in the form and substance reasonably acceptable to the Administrative Agent;
(e) no Event of Default under Section 8.01(a), (b), (g) or (h) of the Credit Agreement shall have occurred and be continuing at the time of the incurrence of the 2018 Incremental Term Loans made pursuant to this Agreement or immediately after giving effect thereto;
(f) The Administrative Agent shall have received:
(i) a certificate of the secretary or assistant secretary (or equivalent officer) on behalf of each Credit Party dated the Increase Effective Date, certifying (A) (i) that attached thereto is a true and complete copy of each Organizational Document of such Credit Party and, with respect to the articles or certificate of incorporation or organization (or similar document) certified (to the extent applicable) as of a recent date by the Secretary of State of the state of its organization or (ii) that the copy of each Organizational Document of such Credit Party delivered to the Administrative Agent as of the Closing Date remains the true and complete copy as of the date hereof and remains in full force and effect as of the date hereof, (B) that attached thereto is a true and complete copy of resolutions duly adopted by the Board of Directors of such Credit Party authorizing the execution, delivery and performance of this Agreement and the other Loan Documents to which such person is a party that are delivered in connection herewith, and that such resolutions have not been modified, rescinded or amended and are in full force and effect as of the date of such certificate, and (C) as to the incumbency and specimen signature of each officer or authorized person executing this Agreement or any other Loan Document or any other document delivered in connection herewith on behalf of such Credit Party (together with a certificate of another officer or authorized person as to the incumbency and specimen signature of the officer or authorized person executing the certificate in this clause (i)); and
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(ii) a certificate as to the good standing of each Credit Party as of a recent date, from the Secretary of State (or other applicable Governmental Authority) of its jurisdiction of organization;
(g) the Borrower shall have delivered to Administrative Agent an officers certificate, in form and substance reasonably acceptable to Administrative Agent, certifying that the conditions under Sections 2.20(a), (b) and (c) of the Credit Agreement and Sections 4(c) and (e) of this Agreement have been satisfied;
(h) the 2018 Incremental Lenders shall have received all fees and other amounts due and payable to them on or prior to the Increase Effective Date pursuant to this Agreement;
(i) the Administrative Agent and the 2018 Incremental Term Loan Arranger shall have received, to the extent invoiced at least two (2) Business Day prior to the Increase Effective Date, reimbursement for all reasonable and documented out-of-pocket costs and expenses, including the reasonable fees and disbursements of one counsel incurred by the Administrative Agent and the 2018 Incremental Term Loan Arranger in connection with this Agreement;
(j) the Administrative Agent shall have received a solvency certificate in substantially the form delivered on the Closing Date, dated as of the Increase Effective Date and signed by the chief financial officer (or equivalent officer) of Holdings;
(k) so long as requested by the Administrative Agent at least four (4) Business Days prior to the Increase Effective Date, the Administrative Agent shall have received, at least two (2) Business Days prior to the Increase Effective Date, (i) all documentation and other information that is required by regulatory authorities under applicable know your customer and anti-money laundering rules and regulations, including the Patriot Act and 31 C.F.R. § 1010.230 (the Beneficial Ownership Regulation) and (ii) if the Borrower qualifies as a legal entity customer under the Beneficial Ownership Regulation, the Borrower shall deliver a certification regarding beneficial ownership as required by the Beneficial Ownership Regulation;
(l) the Borrower shall repay in full (directly or indirectly) the outstanding loans under, terminate the commitments under, and terminate, that certain Loan and Security Agreement, dated as of November 30, 2015 (the Existing Credit Agreement), by and among Silicon Valley Bank and the 2018 Target and certain Subsidiaries of the 2018 Target, as such agreement has been amended, restated, amended and restated, supplemented or otherwise modified prior to the Increase Effective Date; and
(m) the Administrative Agent shall have received duly executed counterparts of the Assignment and Assumption Agreement entered into by and among Goldman Sachs Bank USA and VCO Capital Markets LLC or any of its affiliates with respect to assignment of the 2018 Incremental Term Loans.
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SECTION 5. Costs. Expenses. As provided in Section 10.03 of the Amended Credit Agreement, the Credit Parties agree to reimburse the Administrative Agent for all reasonable and documented out-of-pocket expenses, including the reasonable and documented fees and disbursements of one counsel, plus one local counsel per relevant material jurisdiction, incurred by the Administrative Agent in connection with this Agreement.
SECTION 6. Counterparts; Effectiveness. 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. Except as provided in Section 4, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement by telecopier or other electronic transmission (PDF or TIFF format) shall be effective as delivery of a manually executed counterpart of this Agreement.
SECTION 7. Governing Law. This Agreement shall be construed in accordance with and governed by the law of the State of New York.
SECTION 8. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE REQUIREMENTS OF 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 (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) 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.
SECTION 9. Reaffirmation. Each of the Credit Parties as debtor, grantor, mortgagor, pledgor, guarantor, assignor, or in other any other similar capacity in which such Credit Party grants liens or security interests in its property or otherwise acts as accommodation party, guarantor or indemnitor, as the case may be, hereby (i) ratifies and reaffirms all of its payment and performance obligations, contingent or otherwise, under each of the Loan Documents to which it is a party (after giving effect hereto) and (ii) to the extent such Credit Party granted liens on or security interests in any of its property pursuant to any such Loan Document as security for or otherwise guaranteed the Obligations under or with respect to the Loan Documents, ratifies and reaffirms such guarantee and grant of security interests and liens and confirms and agrees that such guarantee includes, and such security interests and liens hereafter secure, all of the Obligations as amended hereby. Each of the Credit Parties hereby consents to this Agreement and acknowledges that each of the Loan Documents remains in full force and effect and is hereby ratified and reaffirmed. The execution of this Agreement shall not operate as a waiver of any right, power or remedy of the Administrative Agent or Lenders, constitute a waiver of any provision of any of the Loan Documents or serve to effect a novation of the Obligations. This Agreement shall constitute a Loan Document and an Increase Joinder for purposes of the Amended Credit Agreement.
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SECTION 10. 2018 Incremental Term Loan Arranger. The Borrower and the other Credit Parties agree that (a) the 2018 Incremental Term Loan Arranger shall be entitled to the privileges, indemnification, immunities and other benefits afforded to the Lead Arrangers under the Amended Credit Agreement and (b) the 2018 Incremental Term Loan Arranger shall have no duties, responsibilities or liabilities with respect to this Agreement, the Amended Credit Agreement or any other Loan Document.
SECTION 11. No Novation. By its execution of this Agreement, each of the parties hereto acknowledges and agrees that the terms of this Agreement do not constitute a novation, but, rather, a supplement of a pre-existing indebtedness and related agreement, as evidenced by the Amended Credit Agreement.
[REMAINDER OP PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.
BORROWERS: |
CVENT, INC., a Delaware corporation |
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By: | /s/ William J. Newman | |||||
Name: William J. Newman Title: Senior Vice President, Finance |
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HOLDINGS: |
PAP AY HOLDCO, LLC, a Delaware limited liability company |
|||||
By: | /s/ William J. Newman | |||||
Name: William J. Newman Title: Senior Vice President, Finance |
||||||
GUARANTORS: |
CROWDCOMPASS, L.L.C., a Delaware limited liability company CVENT ATLANTA, LLC, a Delaware limited liability company CVENT ONARRIVAL, INC., a Delaware corporation ELITE MEETINGS INTERNATIONAL, LLC, a Delaware limited liability company GENIECONNECT, INC., a Delaware corporation KAPOW EVENTS, INC., a Delaware corporation LANYON SOLUTIONS, INC., a Delaware corporation LANYON, INC., a Delaware corporation MERCURY HOLDING, LLC, a Delaware limited liability company SIGNUP4 MOBILE, LLC, a Georgia limited liability company SIGNUP4, LLC, a Delaware limited liability company STARCITE, INC., a Delaware corporation SU4-WORKTOPIA, LLC, a Georgia limited liability company |
|||||
By: | /s/ William J. Newman | |||||
Name: William J. Newman Title: Senior Vice President, Finance |
[Signature Page to Incremental Amendment No. 1 and Joinder Agreement]
CROWDTORCH LLC, | ||||||
a Delaware limited liability company | ||||||
By: | /s/ Nitin Malhotra | |||||
Name: Nitin Malhotra | ||||||
Title: President |
Exhibit 10.13
EXECUTION VERSION
INCREMENTAL FACILITY ASSUMPTION AGREEMENT NO. 2
This INCREMENTAL FACILITY ASSUMPTION AGREEMENT NO. 2 (this Agreement), dated as of October 26, 2018, is made by and among Cvent, Inc., a Delaware corporation (Borrower), Papay Holdco, LLC, a Delaware limited liability company (Holdings), the other Credit Parties party hereto, each of the financial institutions party hereto as lenders (in such capacity, the 2018-B Incremental Lenders) and Goldman Sachs Bank USA, as administrative agent (in such capacity, together with its successors and assigns, the Administrative Agent) for the Lenders under, and as defined in, the Credit Agreement (as defined below).
PRELIMINARY STATEMENTS:
(1) The Borrower, the other Credit Parties, the Lenders from time to time party thereto, the Administrative Agent and Goldman Sachs Bank USA, as Collateral Agent for the Secured Parties, as Swing Line Lender and as the Issuing Bank, are party to that certain Amended and Restated Credit Agreement, dated as of November 30, 2017 (as amended by that certain Incremental Facility Assumption Agreement No. 1, dated as of October 16, 2018, and as further amended, restated, amended and restated, supplemented or otherwise modified prior to the date hereof, the Credit Agreement; as amended by this Agreement, the Amended Credit Agreement). Capitalized terms not otherwise defined in this Agreement have the same meanings as specified in the Amended Credit Agreement;
(2) The Borrower has requested that the 2018-B Incremental Lenders collectively provide 2018-B Incremental Term Loan Commitments (as defined below), and make 2018-B Incremental Term Loans (as defined below) pursuant thereto, in an aggregate principal amount equal to $40,000,000 on the effective date with respect to the 2018-B Incremental Term Loans made hereunder (as used herein, the Increase Effective Date), and each 2018-B Incremental Lender is prepared to provide a portion of such 2018-B Incremental Term Loan Commitments and to provide a portion of the 2018-B Incremental Term Loans pursuant thereto, in the respective amounts set forth on Schedule 2.01(a) hereto, in each case subject to the other terms and conditions set forth herein;
(3) The Borrower, Holdings, the other Credit Parties, the 2018-B Incremental Lenders and the Administrative Agent are entering into this Agreement in order to evidence such 2018-B Incremental Term Loan Commitments and 2018-B Incremental Term Loans, which are made in accordance with Section 2.20 of the Credit Agreement and incurred pursuant to (A) the Incurrence Ratio with respect to 2018-B Incremental Term Loans in an amount equal to $33,425,000 and (B) the Fixed Incremental Amount with respect to 2018-B Incremental Term Loans in an amount equal to $6,575,000;
(4) The proceeds of the 2018-B Incremental Term Loans will be used to (a) prepay the outstanding loans under the Interim Financing (as defined below) (the Refinancing), (b) pay fees, costs and expenses incurred in connection with this Agreement, the Refinancing and the transactions contemplated hereby and thereby and (c) finance working capital and general corporate purposes.
SECTION 1. Incremental Facilities. Pursuant to Section 2.20 of the Credit Agreement, on and as of the Increase Effective Date:
(a) Each 2018-B Incremental Lender that is not, prior to the effectiveness of this Agreement, a Term Loan Lender under the Credit Agreement, hereby agrees that upon, and subject to, the occurrence of the Increase Effective Date, such 2018-B Incremental Lender shall be deemed to be, and shall become, a Term Loan Lender for all purposes of, and subject to all the obligations of a Term Loan Lender under, the Amended Credit Agreement and the other Loan Documents. Each 2018-B Incremental Lender shall have an Incremental Term Loan Commitment that is equal to the amount set forth opposite such 2018-B Incremental Lenders name under the heading 2018-B Incremental Term Loan Commitments on Schedule 2.01(a) to this Agreement (such commitment hereinafter referred to as the 2018-B Incremental Term Loan Commitments). Each Credit Party and the Administrative Agent hereby agree that from and after the Increase Effective Date, each 2018-B Incremental Lender shall be deemed to be, and shall become, a Term Loan Lender for all purposes of, and with all of the rights and remedies of a Term Loan Lender under, the Amended Credit Agreement and the other Loan Documents.
(b) Each 2018-B Incremental Lender hereby agrees to make 2018-B Incremental Term Loans to the Borrower on the Increase Effective Date in a principal amount not to exceed its respective 2018-B Incremental Term Loan Commitment set forth on Schedule 2.01(a) to this Agreement.
(c) Section 1.01 of the Credit Agreement is hereby amended by inserting the following new definitions in the appropriate alphabetical order therein:
(i) 2018-B Incremental Lender shall mean any Lender that holds a 2018-B Incremental Term Loan Commitment and/or a 2018-B Incremental Term Loan outstanding hereunder.
(ii) 2018-B Incremental Term Loan Commitment shall mean as to each 2018-B Incremental Lender, its obligation to make 2018-B Incremental Term Loans to the Borrower on the Second Incremental Amendment Date in an aggregate principal amount not to exceed the amount set forth opposite such 2018-B Incremental Lenders name on Annex A under the caption 2018-B Incremental Term Loan Commitment.
(iii) 2018-B Incremental Term Loans shall mean the Term Loans made to the Borrower on the Second Incremental Amendment Date in the principal amount of $40,000,000.
(iv) Second Incremental Amendment shall mean that certain Incremental Facility Assumption Agreement No. 2, dated as of October 26, 2018, by and among the Borrower, Holdings, the other Credit Parties party thereto, the 2018-B Incremental Lenders party thereto and the Administrative Agent.
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(v) Second Incremental Amendment Date shall mean the date on which all the conditions precedent set forth in Section 4 of the Second Incremental Amendment shall have been satisfied or waived in accordance with the terms thereof. For the avoidance of doubt, the Second Incremental Amendment Date shall be October 26, 2018.
(d) Section 1.01 of the Credit Agreement is hereby amended by amending and restating the last sentence of the definition of Tranche as follows:
Notwithstanding any provision herein to the contrary, the Term Loans made on the Closing Date, the 2018 Incremental Term Loans made on the First Incremental Amendment Date and the 2018-B Incremental Term Loans made on the Second Incremental Amendment Date shall be deemed to be, and treated as, part of a single Tranche for all purposes hereunder.
(e) Section 2.09 of the Credit Agreement is hereby amended by replacing the same in full with the following:
Section 2.09 Amortization of Term Loan Borrowings. The Borrower shall pay to the Administrative Agent, for the ratable account of the Term Loan Lenders, on the last Business Day of each March, June, September and December, commencing on the last Business Day of December, 2018 (each such date, a Term Loan Repayment Date), an amount equal to (i) 0.25% in respect of principal of the Term Loans made on the Closing Date, (ii) 0.2512562814% in respect of principal of the 2018 Incremental Term Loans made on the First Incremental Amendment Date and (iii) 0.2512562814% in respect of principal of the 2018-B Incremental Term Loans made on the Second Incremental Amendment Date, in each case, as adjusted from time to time pursuant to Section 2.10(h), as reduced by the principal amount of Loans contributed or assigned to Holdings or any of its Restricted Subsidiaries pursuant to Section 10.04(b)(vi) or (viii), and as adjusted in connection with the making of any further Incremental Term Loans pursuant to Section 2.20 hereof, together in each case with accrued and unpaid interest on the principal amount to be paid to but excluding the date of such payment. To the extent not previously paid, all Term Loans made on the Closing Date, all 2018 Incremental Term Loans made on the First Incremental Amendment Date and all 2018-B Incremental Term Loans made on the Second Incremental Amendment Date shall be due and payable by the Borrower on the Term Loan Maturity Date.
(f) Section 3.11 of the Credit Agreement is hereby amended by adding the following sentence at the end thereof:
For the avoidance of doubt, the Borrower will (or will direct a Credit Party to) use the proceeds of the 2018-B Incremental Term Loans made on the Second Incremental Amendment Date, to (i) prepay the outstanding loans under the Interim Financing (as defined in the Second Incremental Amendment), (ii) pay fees, costs and expenses incurred in connection with the Second Incremental Amendment and the transactions contemplated thereby and (iii) finance working capital and general corporate purposes.
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(g) The Credit Agreement is hereby amended by inserting as part of Annex A thereto Schedule 2.01(a) attached hereto.
SECTION 2. Terms and Agreements. The 2018-B Incremental Term Loans made pursuant to this Agreement shall constitute Term Loans for all purposes of the Amended Credit Agreement and the other Loan Documents, and shall have the same terms as, and be part of the same series as, the Term Loans made prior to the Increase Effective Date.
SECTION 3. Representations and Warranties. Each Credit Party represents and warrants that as of the Increase Effective Date:
(a) The representations and warranties made by any Credit Party set forth in Article III of the Credit Agreement or in any other Loan Document are true and correct in all material respects (except that any representation and warranty that is qualified as to materiality or Material Adverse Effect is true and correct in all respects) on and as of the Increase Effective Date with the same effect as though made on and as of such date, except to the extent that such representation or warranty expressly relates to an earlier date in which case such representations and warranties are true and correct in all material respects (except that any representation and warranty that is qualified as to materiality or Material Adverse Effect is true and correct in all respects) as of such earlier date; and
(b) no Event of Default under the Credit Agreement shall have occurred and be continuing at the time of the incurrence of the 2018-B Incremental Term Loans made pursuant to this Agreement or immediately after giving effect thereto.
SECTION 4. Conditions to Effectiveness on Increase Effective Date. This Agreement, and the obligations of the 2018-B Incremental Lenders to make their respective 2018-B Term Loan Commitments, and to fund their respective 2018-B Incremental Term Loans, as specified in Section 1 hereof, shall become effective on and as of the Business Day on which the conditions to such 2018-B Incremental Term Loans set forth in Sections 2.20(a), (b) and (c) of the Credit Agreement shall have been satisfied (such date, the Increase Effective Date), including:
(a) the Administrative Agent shall have received duly executed counterparts of this Agreement from the Borrower, each other Credit Party and each 2018-B Incremental Lender;
(b) the Administrative Agent shall have received a Borrowing Request for the borrowing of the 2018-B Incremental Term Loans to be made pursuant to this Agreement;
(c) the Administrative Agent shall have received, on behalf of itself, the Collateral Agent and the Lenders, a customary opinion of Kirkland & Ellis LLP, special counsel to the Borrower and each Credit Party, each dated as of the Increase Effective Date, addressed to the Agents and the Lenders and in the form and substance reasonably acceptable to the Administrative Agent;
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(d) no Event of Default under the Credit Agreement shall have occurred and be continuing at the time of the incurrence of the 2018-B Incremental Term Loans made pursuant to this Agreement or immediately after giving effect thereto;
(e) The Administrative Agent shall have received:
(i) a certificate of the secretary or assistant secretary (or equivalent officer) on behalf of each Credit Party dated the Increase Effective Date, certifying (A) (i) that attached thereto is a true and complete copy of each Organizational Document of such Credit Party and, with respect to the articles or certificate of incorporation or organization (or similar document) certified (to the extent applicable) as of a recent date by the Secretary of State of the state of its organization or (ii) that the copy of each Organizational Document of such Credit Party delivered to the Administrative Agent as of the First Incremental Amendment Date remains the true and complete copy as of the date hereof and remains in full force and effect as of the date hereof, (B) that attached thereto is a true and complete copy of resolutions duly adopted by the Board of Directors of such Credit Party authorizing the execution, delivery and performance of this Agreement and the other Loan Documents to which such person is a party that are delivered in connection herewith, and that such resolutions have not been modified, rescinded or amended and are in full force and effect as of the date of such certificate, and (C) as to the incumbency and specimen signature of each officer or authorized person executing this Agreement or any other Loan Document or any other document delivered in connection herewith on behalf of such Credit Party (together with a certificate of another officer or authorized person as to the incumbency and specimen signature of the officer or authorized person executing the certificate in this clause (i)); and
(ii) a certificate as to the good standing of each Credit Party as of a recent date, from the Secretary of State (or other applicable Governmental Authority) of its jurisdiction of organization;
(f) the Borrower shall have delivered to Administrative Agent an officers certificate, in form and substance reasonably acceptable to Administrative Agent, certifying that the conditions under Sections 2.20(a), (b) and (c) of the Credit Agreement and Sections 4(d)) of this Agreement have been satisfied;
(g) the 2018-B Incremental Lenders shall have received all fees and other amounts due and payable to them on or prior to the Increase Effective Date pursuant to this Agreement;
(h) the Administrative Agent and the 2018-B Incremental Lenders shall have received, to the extent invoiced at least two (2) Business Days prior to the Increase Effective Date, reimbursement for all reasonable and documented out-of-pocket costs and expenses, including the reasonable fees and disbursements of one counsel incurred by the Administrative Agent and the 2018-B Incremental Lenders in connection with this Agreement;
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(i) the Administrative Agent shall have received a solvency certificate in substantially the form delivered on the Closing Date, dated as of the Increase Effective Date and signed by the chief financial officer (or equivalent officer) of Holdings;
(j) so long as requested by the Administrative Agent at least four (4) Business Days prior to the Increase Effective Date, the Administrative Agent shall have received, at least two (2) Business Days prior to the Increase Effective Date, (i) all documentation and other information that is required by regulatory authorities under applicable know your customer and anti-money laundering rules and regulations, including the Patriot Act and 31 C.F.R. § 1010.230 (the Beneficial Ownership Regulation) and (ii) if the Borrower qualifies as a legal entity customer under the Beneficial Ownership Regulation, the Borrower shall deliver a certification regarding beneficial ownership as required by the Beneficial Ownership Regulation; and
(k) the Borrower shall repay (directly or indirectly) the outstanding loans made to the Borrower in an aggregate principal amount of $40,000,000 under that certain Revolving Credit Agreement, dated as of March 16, 2016 (as amended by that certain First Amendment to Revolving Credit Agreement, dated as of March 31, 2016, that certain Second Amendment to Revolving Credit Agreement, dated as of June 23, 2016, that certain Third Amendment to Revolving Credit Agreement, dated as of October 6, 2016, and that certain Fourth Amendment to Revolving Credit Agreement, dated as of November 14, 2016, the Interim Financing), by and among Vista Equity Partners Fund VI, L.P. and the other Fund Borrowers (as defined in the Interim Financing) party thereto, the Borrower, the other Qualified Borrowers (as defined in the Interim Financing) party thereto, the lenders party thereto and Wells Fargo Bank, N.A., as Administrative Agent.
SECTION 5. Costs, Expenses. As provided in Section 10.03 of the Amended Credit Agreement, the Credit Parties agree to reimburse the Administrative Agent for all reasonable and documented out-of-pocket expenses, including the reasonable and documented fees and disbursements of one counsel, plus one local counsel per relevant material jurisdiction, incurred by the Administrative Agent in connection with this Agreement.
SECTION 6. Counterparts; Effectiveness. 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. Except as provided in Section 4, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement by telecopier or other electronic transmission (PDF or TIFF format) shall be effective as delivery of a manually executed counterpart of this Agreement.
SECTION 7. Governing Law. This Agreement shall be construed in accordance with and governed by the law of the State of New York.
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SECTION 8. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE REQUIREMENTS OF 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 (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) 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.
SECTION 9. Reaffirmation. Each of the Credit Parties as debtor, grantor, mortgagor, pledgor, guarantor, assignor, or in other any other similar capacity in which such Credit Party grants liens or security interests in its property or otherwise acts as accommodation party, guarantor or indemnitor, as the case may be, hereby (i) ratifies and reaffirms all of its payment and performance obligations, contingent or otherwise, under each of the Loan Documents to which it is a party (after giving effect hereto) and (ii) to the extent such Credit Party granted liens on or security interests in any of its property pursuant to any such Loan Document as security for or otherwise guaranteed the Obligations under or with respect to the Loan Documents, ratifies and reaffirms such guarantee and grant of security interests and liens and confirms and agrees that such guarantee includes, and such security interests and liens hereafter secure, all of the Obligations as amended hereby. Each of the Credit Parties hereby consents to this Agreement and acknowledges that each of the Loan Documents remains in full force and effect and is hereby ratified and reaffirmed. The execution of this Agreement shall not operate as a waiver of any right, power or remedy of the Administrative Agent or Lenders, constitute a waiver of any provision of any of the Loan Documents or serve to effect a novation of the Obligations. This Agreement shall constitute a Loan Document and an Increase Joinder for purposes of the Amended Credit Agreement.
SECTION 10. No Novation. By its execution of this Agreement, each of the parties hereto acknowledges and agrees that the terms of this Agreement do not constitute a novation, but, rather, a supplement of a pre-existing indebtedness and related agreement, as evidenced by the Amended Credit Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officers thereunto duly authorized, as of the date first above written.
BORROWERS: |
CVENT, INC., a Delaware corporation |
|||||
By: |
/s/ William J. Newman, III |
|||||
Name: William J. Newman, III |
||||||
Title: Senior Vice President, Finance | ||||||
HOLDINGS: |
PAPAY HOLDCO, LLC, a Delaware limited liability company |
|||||
By: |
/s/ William J. Newman, III |
|||||
Name: William J. Newman, III |
||||||
Title: Senior Vice President, Finance |
||||||
GUARANTORS: |
CROWDCOMPASS, L.L.C., a Delaware limited liability company CVENT ATLANTA, LLC, a Delaware limited liability company CVENT ONARRIVAL, INC., a Delaware corporation ELITE MEETINGS INTERNATIONAL, LLC, a Delaware limited liability company GENIECONNECT, INC., a Delaware corporation LANYON SOLUTIONS, INC., a Delaware corporation LANYON, INC., a Delaware corporation MERCURY HOLDING, LLC, a Delaware limited liability company SIGNUP4 MOBILE, LLC, a Georgia limited liability company SIGNUP4, LLC, a Delaware limited liability company STARCITE, INC., a Delaware corporation SU4-WORKTOPIA, LLC, a Georgia limited liability company |
|||||
By: |
/s/ William J. Newman, III |
|||||
Name:William J. Newman, III |
||||||
Title: Senior Vice President, Finance |
[Signature Page to Incremental Amendment No. 2]
Exhibit 10.14
June 6, 2017
Rajeev Aggarwal
[***]
Re: |
Employment with Cvent, Inc. |
Dear Reggie:
This is your employment agreement with Cvent, Inc., a Delaware corporation (as such companys name may change from time to time and such companys successors and assigns, the Company). It sets forth the terms of your continued employment by the Company, which shall be effective as of the closing (the Closing) of the transactions (the Transaction) contemplated by that certain Agreement and Plan of Merger, dated as of April 17, 2016, by and among the Company, Papay Holdco, LLC, a Delaware limited liability company (Parent) and Papay Merger Sub, Inc., a Delaware corporation, pursuant to which the Company became a wholly-owned subsidiary of Parent on November 29, 2016 (the Closing Date). We are very excited about this opportunity and value the role that you will serve on our team going forward.
1. You will be the Chief Executive Officer and President of the Company, reporting to the Board of Directors of the Company (the Board). In this capacity, you will have the responsibilities and duties consistent with such position.
2. Effective as of March 1, 2017, your base salary will be $431,668.00 per year (the Initial Base Salary), less deductions and withholdings required by law or authorized by you, and thereafter will be subject to review annually for any increases or decreases; provided, however, that the aggregate amount of any decreases during the course of your employment hereunder shall not be greater than 10% of the Initial Base Salary, and any such decreases may only be implemented in conjunction with a general decrease affecting the executive management team. Your base salary will be paid by the Company in regular installments in accordance with the Companys general payroll practices as in effect from time to time.
For the bonus period beginning on January 1, 2017, you will be eligible to receive an annual bonus (the Bonus) with a target amount equal to $135,852.00. The Bonus will be awarded at the sole discretion of the Board, based upon the Boards and the Companys Chief Executive Officers mutual determination as to your achievement of predetermined thresholds, which may include management by objectives (MBO) targets and financial targets such as bookings, revenue, recurring revenue, gross profit and/or EBITDA targets. In addition, you may be eligible for an additional stretch bonus (the Stretch Bonus), awarded at the discretion of the Board and the Companys Chief Executive Officer, based on the Boards and the Companys Chief Executive Officers mutual determination as to your achievement of stretch targets.
With respect to bonus periods beginning on and after January 1, 2018, the bonus formulas, MBOs, performance milestones and all other elements of your bonus opportunities shall be established by the Board, in its sole discretion, and communicated in writing (including email) to you from time to time. Each annual bonus earned for a fiscal year shall be paid within 30 days after the Board has received, reviewed and approved the applicable fiscal years final audited financial statements. In any event, payment of any bonus that becomes due with respect to a fiscal year shall be paid in the calendar year following the calendar year in which the fiscal year ends, subject, in each case, to your continued employment on the applicable payment date.
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3. You will also be eligible to participate in health, dental and vision insurance plans and other employee benefit plans established by the Company or its affiliates for their employees from time to time, in accordance with the terms of such plans, so long as they remain generally available to such employees.
4. During your employment, your position shall be based in Tysons Corner, Virginia. Your duties may involve extensive domestic and international travel.
5. You received options (the Options) to purchase 35,757.00 shares of Papay Topco, Inc. (Topco), which shall be issued under Topcos 2017 Stock Option Plan (as amended, restated or otherwise modified from time to time, the Option Plan) pursuant to an Option Grant Agreement entered into on or about May 26, 2017.
6. There are some formalities that you need to complete as a condition of your employment:
You must carefully consider and sign the Companys standard Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement (attached to this letter as Exhibit A). Because the Company and its affiliates are engaged in a continuous program of research, development, production and marketing in connection with their business, we wish to reiterate that it is critical for the Company and its affiliates to preserve and protect their proprietary information and their rights in inventions.
So that the Company has proper records of inventions that may belong to you, we ask that you also complete Schedule 1 attached to Exhibit A.
You and the Company mutually agree that any disputes that may arise regarding your employment will be submitted to binding arbitration pursuant to the arbitration clause set forth in Section 10 of Exhibit A. As a condition of your employment, you will need to carefully consider and voluntarily agree to the arbitration clause set forth in Section 10 of Exhibit A.
7. We also wish to remind you that, as a condition of your employment, you are expected to abide by the Companys, its subsidiaries and affiliates written policies and procedures, which may be amended from time to time, at the Companys sole discretion.
8. Your employment with the Company is at will. The Company may terminate your employment at any time with or without notice, and for any reason or no reason. You shall be entitled to terminate your employment with the Company at any time and for any reason or no reason by giving notice in writing to the Company of not less than eight (8) weeks (Notice Period), unless otherwise agreed to in writing by you and the Company. In the event of such notice, the Company reserves the right, in its discretion, to give immediate effect to your resignation in lieu of requiring or allowing you to continue to work throughout the Notice Period; provided that, you will receive a cash payment equal to the base salary you would have otherwise
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earned during the remaining portion of the Notice Period had the Company not given immediate effect to your resignation. You shall continue to be an employee of the Company during the Notice Period, and thus owe to the Company the same duty of loyalty you owed it prior to giving notice of your termination. The Company may, during the Notice Period, relieve you of all of your duties and prohibit you from entering the Companys offices.
9. If the Company terminates your employment without Cause or you voluntarily terminate your employment for Good Reason, you will be entitled to receive (x) a severance payment equal to 12 months of your then applicable base salary, less deductions and withholdings required by law or authorized by you (the Severance Pay) (y) solely to the extent approved in writing by the Board and the Chief Executive Officer, a prorated portion of any bonus that you otherwise would have earned during the fiscal year in which such termination occurs had your employment continued and (z) reimbursement of any COBRA premiums you paid for continued health coverage during the 12 month period following the termination of your employment. For purposes of this section, Cause and Good Reason have the meaning set forth in Exhibit Il attached hereto. The Company will not be required to pay the Severance Pay unless (i) you execute and deliver to the Company an agreement (Release Agreement) in a form satisfactory to the Company releasing from all liability (other than the payments and benefits contemplated by this letter) the Company, each member and affiliate of the Company, and any of their respective past or present investors, members, officers, directors, managers, employees or agents, which Release Agreement will not contain any additional non-disparagement, non-solicitation or non-competition obligations, and you do not revoke such Release Agreement during any applicable revocation period, (ii) such Release Agreement is executed and delivered (and no longer subject to revocation, if applicable) within 60 days following termination, and (iii) you continue to comply with the provisions of Sections 2 through 8 of Exhibit A, the terms of this letter and any restrictive covenant agreement between you and the Company and the provisions of the Release Agreement. The Severance Pay shall be paid in installments in accordance with the Companys general payroll practices at the time of termination, but no less frequently than monthly, starting on the sixtieth (60th) day following your termination of employment, provided you have executed, delivered, and not revoked the Release Agreement during such revocation period for the Release Agreement described above. For the avoidance of doubt, you shall not be required to mitigate the payments provided to you under this Section 9 by seeking other employment or engagement, nor shall, except as set forth in this Section 9, any amounts paid to you under this Section 9 be reduced by any other compensation earned by you.
10. You shall not make any statement that would libel, slander or disparage the Company, any member of the Company or its affiliates or any of their respective past or present officers, directors, managers, stockholders, employees or agents, provided that the foregoing shall not prohibit you from (i) making truthful statements in response to legal process, required governmental testimony or filings, or administrative or arbitral proceedings (including, without limitation, depositions in connection with such proceedings), (ii) making statements that you in good faith believe are necessary or appropriate to make in connection with performing your duties and obligations to the Company, (iii) engaging in concerted activity relative to the terms and conditions of your employment or (iv) in communications protected under the National Labor Relations Act, or from filing a charge or providing information to any governmental agency.
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11. While we look forward to a long and profitable relationship, you will be an at-will employee of the Company as described in Section 8 of this letter. Any statements or representations to the contrary (and, indeed, any statements contradicting any provision in this letter) are, and should be regarded by you, as ineffective. Further, your participation in any benefit program or other Company program, if any, is not to be regarded as assuring you of continuing employment for any particular period of time.
12. It should also be understood that all offers of employment are conditioned on the Companys completion of a satisfactory background check. The Company reserves the right to perform background checks during the term of your employment, subject to compliance with applicable laws. You will be required to execute forms authorizing such a background check. In the event that the Company terminates your employment hereunder due to an unsatisfactory background check, notwithstanding anything herein to the contrary, you will be entitled to the Severance Pay, subject to the conditions set forth in Section 9.
13. Section 280G of the Internal Revenue Code
a In the event that any payment, coverage or benefit provided in respect of your employment with the Company and its affiliates, whether under this letter or otherwise and whether before or after termination of your employment (the Payments), would be subject to the Excise Tax (as defined below), but the imposition of the Excise Tax could be avoided by approval of shareholders described in Section 280G(b)(5)(B) of the Internal Revenue Code of 1986, as amended (the Code), then you may cause the Company or any applicable affiliate of the Company to seek such approval, in which case the Company and any such affiliate will use their reasonable best efforts to cause such approval to be obtained and you will cooperate and execute such waivers as may be necessary so that such approval avoids imposition of any Excise Tax.
b In the event that any Payment could reasonably be expected to be subject to the Excise Tax and either (i) you do not elect to cause the Company or any applicable affiliate to seek approval of shareholders described in Section 280G(b)(5)(B) of the Code or (ii) such approval would not avoid the imposition of the Excise Tax, then the Company shall reduce (but not below zero) the aggregate present value of the Payments to the Reduced Amount (as defined below), if reducing the Payments will provide you with a greater net after-tax amount than would be the case if no such reduction was made. The Payments shall be reduced as described in the preceding sentence only if (a) the net amount of the Payments, as so reduced (and after subtracting the net amount of federal, state and local income and payroll taxes on the reduced Payments), is greater than or equal to (b) the net amount of the Payments without such reduction (but after subtracting the net amount of federal, state and local income and payroll taxes on the Payments and the amount of Excise Tax to which you would be subject with respect to the unreduced Payments). Any reduction shall be made in accordance with Section 409A of the Code.
c For purposes of this Section 13, the term Reduced Amount shall be an amount expressed in present value that maximizes the aggregate present value of Payments without causing any Payments to be subject to the Excise Tax, determined in accordance with Section 280G(d)(4) of the Code, and the term Excise Tax means the excise tax imposed under Section 4999 of the Code, together with any interest or penalties imposed with respect to such excise tax.
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d All determinations to be made under this Section 13 shall be made by an independent registered public accounting firm or consulting firm selected by the Company and consented to by you immediately prior to a change in control, which shall provide its determinations and any supporting calculations both to the Company and you within 15 days prior to the change in control. All fees and expenses of the accounting or consulting firm in performing the determinations referred to in this Section 12 shall be borne solely by the Company.
14. This letter along with its Exhibits and the documents referred to herein constitute the entire agreement and understanding of the parties with respect to the subject matter of this letter, and supersede all prior understandings and agreements, including but not limited to employment agreements, severance agreements, and bonus agreements, whether oral or written, between or among you and the Company, Parent or any of their respective predecessors or affiliates with respect to the specific subject matter hereof. Waivers or modifications of this letter are valid only if in writing and duly executed by each of the parties hereto.
15. In the event of a conflict between the terms of this letter and the provisions of Exhibit A, the terms of this letter shall prevail.
16. Notwithstanding any other provision herein, the Company shall be entitled to withhold from any amounts otherwise payable hereunder any amounts required to be withheld in respect to federal, state or local taxes. The intent of the parties is that payments and benefits under this letter be exempt from, or comply with, Code Section 409A and the regulations and guidance promulgated thereunder (collectively Code Section 409A) and, accordingly, to the maximum extent permitted, this letter shall be interpreted to be in compliance therewith. In no event whatsoever shall the Company be liable for any additional tax, interest or penalty that may be imposed on you by Code Section 409A or damages for failing to comply with Code Section 409A. To the extent required by Code Section 409A, a termination of employment shall not be deemed to have occurred for purposes of any provision of this letter providing for the payment of any amounts or benefits upon or following a termination of employment unless such termination is also a separation from service within the meaning of Code Section 409A and, for purposes of any such provision of this letter, references to a termination, termination of employment or like terms shall mean separation from service. For purposes of Code Section 409A, your right to receive any installment payments pursuant to this letter shall be treated as a right to receive a series of separate and distinct payments. To the extent that reimbursements or other in-kind benefits under this letter constitute nonqualified deferred compensation for purposes of Code Section 409A, (a) all such expenses or other reimbursements hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by you, (b) any right to such reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit, and (c) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year. Notwithstanding anything in this letter to the contrary, if you are a specified employee for purposes of Code Section 409A and if payment of any amounts under this letter is required to be delayed for a period of six months after separation from service pursuant to Code Section 409A, payment of such amounts shall be delayed as required by Code Section 409A, and the accumulated amounts shall be paid in a lump sum payment within 15 days after the end of the six-month period, or if earlier, upon your death.
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If you decide to accept the terms of this letter, and I hope you will, please signify your acceptance of these conditions of employment by signing and dating the enclosed copy of this letter and Exhibit A and returning them to me, not later than June 9, 2017. Should you have anything that you wish to discuss, please do not hesitate to contact me at.
* * * *
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By signing this letter and Exhibit A attached hereto, you represent and warrant that you have had the opportunity to seek the advice of independent counsel before signing and have either done so, or have freely chosen not to do so, and either way, you sign this letter voluntarily.
Very truly yours, |
/s/ Brian N. Sheth |
Brian N. Sheth |
Chairman of the Board |
I have read and understood this letter and Exhibit A attached and hereby acknowledge, accept and agree to the terms set forth therein.
/s/ Rajeev Aggarwal |
Date signed: |
6/9/17 |
||||
Rajeev Aggarwal |
LIST OF EXHIBITS
Exhibit A: Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement
Exhibit B: Certain Definitions
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EXHIBIT A
CONFIDENTIALITY, INVENTION ASSIGNMENT, NON-SOLICIT, NON-COMPETE AND ARBITRATION AGREEMENT
As a condition of your employment and/or continued employment with Cvent, Inc. (as such companys name may change from time to time and such companys successors and assigns, the Company), and in exchange for the other and valuable consideration recited in Section 1 below, you and the Company agree to the following:
For purposes of this Agreement, references to the Group means the Company, and its affiliates (whether a parent, subsidiary, or sister entity to the Company) engaged in the same line of business or contemplated business as the Company.
1. CONSIDERATION FOR AGREEMENT.
You understand that the Group is engaged in a continuous program of research, development, production and marketing in connection with its business and that it is critical for the Group to preserve and protect its Proprietary Information (as defined in Section 2 below), its rights in Inventions (as defined in Section 4 below) and in all related intellectual property rights. You acknowledge that, as a result of your employment with the Company and/or its predecessors, you have and/or may receive confidential information, trade secrets, and/or specialized training from the Group, each of which constitutes good and valuable consideration in support of your obligations made under this Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement (this Agreement). As additional consideration, you may also have the opportunity to develop valuable business relationships with employees, agents, suppliers, and customers of the Group and to use the Groups resources and goodwill in the marketplace to develop those relationships. Finally, by your signature below, you acknowledge that both the consideration outlined in your offer of employment from the Company and/or the letter to which this Agreement is attached and your continued employment with the Company (subject to Section 9), which the Company would not allow but for your execution of this Agreement, constitute additional consideration in support of your return promise to maintain the confidentiality of all specialized knowledge and confidential information as well as your promise to adhere to the other restrictions listed in this Agreement, including but not limited to those restrictions described in Section 7 of this Agreement.
2. PROPRIETARY INFORMATION.
You understand that your employment creates a relationship of confidence and trust with respect to any information of a confidential or secret nature that may be disclosed to you or created by you that relates to the business of the Group or to the business of its customers, licensees, suppliers or any other party with whom the Group agrees to hold information of such party in confidence (the Proprietary Information).
You understand and agree that the term Proprietary Information includes but is not limited to information of all types contained in any medium (paper, electronic, in your memory, or otherwise stored or recorded), whether oral or written and regardless of whether it is marked as confidential,
proprietary or a trade secret. Proprietary Information includes, without limitation, the following information and materials, whether having existed, now existing or developed or created by you or on your behalf during your term of employment with the Company or its predecessor:
A) |
All information and materials relating to the existing software products and software in the various stages of research and development, including, but not limited to, source codes, object codes, design specifications, design notes, flow charts, graphics, graphical user interfaces, coding sheets, product plans, know-how, negative know how, test plans, business investment analysis, marketing and functional requirements, algorithms, product bugs and customer technical support cases which relate to the software; |
B) |
Internal business information, procedures and policies, including, but not limited to, licensing techniques, vendor names, other vendor information, business plans, financial information, budgets, forecasts, product margins, product costs, service and/or operation manuals and related documentation including drawings, and other such information, whether written or oral, which relates to the way the Group conducts its business; |
C) |
All legal rights, including but not limited to, trade secrets, pending patents, Inventions (as that term is defined in Section 4 below) and other discoveries, claims, litigation and/or arbitrations involving the Group, pending trademarks, copyrights, proposed advertising, public relations and promotional campaigns and like properties maintained in confidence; |
D) |
Any and all customer sales and marketing information, including but not limited to sales forecasts, marketing and sales promotion plans, product launch plans, sales call reports, competitive intelligence information, customer information, customer lists, customer needs and buying habits, sales and marketing studies and reports, internal price list, discount matrix, customer data, customer contracts, pricing structures, customer negotiations, customer relations materials, customer service materials, past customers, and the type, quantity and specifications of products purchased, leased or licensed by customers of the Group; |
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Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement Virginia
E) |
Any information obtained while working for the Group which gives the Group a competitive edge; |
F) |
Any other knowledge or information regarding the property, business, and affairs of the Group which the Group endeavors to keep confidential or which the Group believes to be confidential; and |
G) |
Any and all other trade secrets, as that term is defined under applicable laws. |
You understand and agree to treat and preserve Proprietary Information and materials as strictly confidential. Except as authorized by the Companys Chief Executive Officer (but in all cases preserving confidentiality by following Company policies and obtaining appropriate non-disclosure agreements), you further agree that, during your employment with the Company or thereafter, you will not directly or indirectly transmit or disclose Proprietary Information to any person, corporation, or other entity for any reason or purpose whatsoever, except in connection with the performance of your employment duties.
You understand and agree that the Proprietary Information is the exclusive property of the Group, and that, during your employment, you will use and disclose Proprietary Information only for the Groups benefit and in accordance with any restrictions placed on its use or disclosure by the Group. After termination of your employment for any reason, you will not use in any manner or disclose any Proprietary Information, except to the extent compelled by applicable law; provided that in the event you receive notice of any effort to compel disclosure of Proprietary Information for any reason, you will promptly and in advance of disclosure notify Company of such notice and fully cooperate with all lawful Company or Group efforts (through their counsel or otherwise) to resist or limit such disclosure.
Proprietary Information does not include information (i) that was or becomes generally available to you on a non-confidential basis, if the source of this information was not reasonably known to you to be bound by a duty of confidentiality, or (ii) that was or becomes generally available to the public, other than as a result of a disclosure by you, directly or indirectly or any other breach of this Agreement.
3. THIRD PARTY INFORMATION. You recognize that the Group has received and in the future will receive from third parties their confidential or proprietary information subject to a duly on the Groups part to maintain the confidentiality of such information and to use it only for certain limited purposes. You agree that you owe the Group and such third parties, during the term of your employment, and thereafter, a duty to hold all such confidential or proprietary information in the strictest confidence and not to disclose it to any person, firm or corporation (except as necessary in carrying out your work for the Group consistent with the Groups agreement with such third party) or to use it for the benefit of anyone other than for the Group or such third party (consistent with the Companys agreement with such third party) without the express written authorization of the Chief Executive Officer of the Company.
All rights and benefits afforded to the Company under this Agreement shall apply equally to the owner of the third party information with respect to the third party information, and such third party is an intended third party beneficiary of this Agreement, with respect to the third party information. You further agree to conform to the Companys privacy policies, as amended from time to time.
4. INVENTIONS.
4.1 Prior Inventions. You have attached hereto as Schedule 1 a complete and accurate list describing all Inventions (as defined below) which were discovered, created, invented, developed or reduced to practice by you prior to the commencement of your employment by the Company and have not been legally assigned or licensed to the Company (collectively: Prior Inventions), which belong solely to you or belong to you jointly with others, which relates in any way to any of the Groups current, proposed or reasonably anticipated businesses, products or research or development and which are not assigned to the Group hereunder; or have initialed Schedule 1 to indicate you have no Prior Inventions to disclose.
If, in the course of your employment with the Company, you incorporate or cause to be incorporated into a Group product, service, process, file, system, application or program a Prior Invention owned by you or in which you have an interest, you hereby grant the Group member a non-exclusive, royalty-free, irrevocable, perpetual, worldwide, sublicensable and assignable license to make, have made, copy, modify, make derivative works of, use, offer to sell, sell or otherwise distribute such Prior Invention as part of or in connection with such product, process, file, system, application or program.
4.2 Disclosure of Inventions. You will promptly disclose in confidence to the Company all Inventions that you make or conceive or first reduce to practice or create, either alone or jointly with others, during the period of your employment, and for a period of three (3) months thereafter, whether or not in the course of your employment, and whether or not such Inventions are patentable, copyrightable or protectable as trade secrets. For purposes of this Agreement, Inventions means without limitation, formulas, algorithms, processes, techniques, concepts, designs, developments, technology, ideas, patentable and unpatentable inventions and discoveries, copyrights and works of authorship in any media now known or hereafter invented (including computer programs, source code, object code, hardware, firmware, software, mask work, applications, files, Internet site content, databases and compilations, documentation and related items) patents, trade and service marks, logos, trade dress, corporate names and other source indicators and the good will of any business symbolized thereby, trade secrets, know-how, confidential and proprietary information, documents, analyses, research and lists (including current and potential customer and user lists) and all applications and registrations and recordings, improvements and licenses related to any of the foregoing. You recognize that Inventions or Proprietary Information relating to your activities while working for the Company, and conceived, reduced to practice, created, derived, developed, or made by you, alone or
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with others, within three (3) months after termination of your employment may have been conceived, reduced to practice, created, derived, developed, or made, as applicable, in significant part while you were employed by the Company. Accordingly, you agree that such Inventions and Proprietary Information shall be presumed to have been conceived, reduced to practice, created, derived, developed, or made, as applicable, during your employment with the Company and are to be assigned to the Company pursuant to this Agreement and applicable law unless and until you have established the contrary by clear and convincing evidence.
4.3 Work for Hire, Assignment of Inventions. You acknowledge and agree that any copyrightable works prepared by you, either alone or jointly with others, within the scope of your employment are works made for hire under the Copyright Act and that the Company will be considered the author and owner of such copyrightable works. Any copyrightable works the Company or a Group member specially commissions from you while you are employed with the Company shall be deemed a work made for hire under the Copyright Act and if for any reason a work cannot be so designated as a work made for hire, you agree to and hereby assign to the Company all right, title and interest in and to said work(s) and the related copyright(s). You agree to and hereby grant the Company a non-exclusive, royalty-free, irrevocable, perpetual, worldwide, sublicensable and assignable license to make, have made, copy, modify, make derivative works of, use, publicly perform, display or otherwise distribute any copyrightable works you create during the time you are employed with the Company that for any reason do not qualify as a work made for hire, that were not specially commissioned by the Group, or both, but that relate in any way to the business of the Group. You agree that all Inventions that (i) are developed using equipment, supplies, facilities Proprietary Information, or trade secrets of the Group, (ii) result from work performed by you for the Group and/or on Company time, or (iii) relate to the Groups business or current or anticipated research and development (the Assigned Inventions), will be the sole and exclusive property of the Company and you agree to and hereby irrevocably assign the Assigned Inventions to the Company
4.4 Assignment of Other Rights. In addition to the foregoing assignment of Assigned Inventions to the Company, you hereby irrevocably transfer and assign to the Company: (i) all worldwide patents, patent applications, copyrights, mask works, trade secrets and other intellectual property rights in any Assigned Invention, and (ii) any and all Moral Rights (as defined below) that you may have in or with respect to any Assigned Inventions. You also hereby forever waive and agree never to assert any and all Moral Rights you may have in or with respect to any Assigned Inventions, even after termination of your work on behalf of the Company. Moral Rights mean any rights to claim authorship of any Assigned Inventions, to object to or prevent the modification of any Assigned Inventions, or to withdraw from circulation or control the publication or distribution of any Assigned Inventions, and any similar right, existing under judicial or statutory law of any country in the world, or under any treaty, regardless of whether or not such right is denominated or generally referred to as a moral right.
4.5 Assistance. Whether during or after your employment, and without additional compensation, you agree to do any act and/or execute any document deemed necessary or desirable by the Company in furtherance of perfecting, prosecuting, recording, maintaining, enforcing and protecting the Groups right, title and interest in and to, any of the Assigned Inventions. In the event that the Company is unable for any reason to secure your signature to any document required to file, prosecute, register or memorialize the ownership and/or assignment of, or to enforce, any intellectual property, you hereby irrevocably designate and appoint the Companys duly authorized officers and agents as your agents and attorneys-in-fact to act for and on your behalf and stead to (i) execute, file, prosecute, register and/or memorialize the assignment and/or ownership of any Assigned Invention; (ii) to execute and file any documentation required for such enforcement and (iii) do all other lawfully permitted acts to further the filing, prosecution, registration, memorialization of assignment and/or ownership of, issuance of and enforcement of any Assigned Inventions, all with the same legal force and effect as if executed by you.
4.6 Applicability to Past Activities. To the extent you have been engaged to provide services by the Company or its predecessor for a period of time before the effective date of this Agreement (the Prior Engagement Period), you agree that if and to the extent that, during the Prior Engagement Period: (i) you received access to any information from or on behalf of the Company that would have been Proprietary Information if you had received access to such information during the period of your employment with the Company under this Agreement; or (ii) you conceived, created, authored, invented, developed or reduced to practice any item, including any intellectual property rights with respect thereto, that would have been an Invention if conceived, created, authored, invented, developed or reduced to practice during the period of your employment with the Company under this Agreement; then any such information shall be deemed Proprietary Information hereunder and any such item shall be deemed an Invention hereunder, and this Agreement shall apply to such information or item as if conceived, created, authored, invented, developed or reduced to practice under this Agreement.
5. NO BREACH OF PRIOR AGREEMENT. You represent that your performance of all the terms of this Agreement and your duties as an employee of the Company will not breach any invention assignment, proprietary information, confidentiality, noncompetition, nonsolicitation, noninterference, or similar agreement with any former employer or other party. You represent that you will not bring with you to the Company or use in the performance of your duties for the Company any documents or materials or intangibles of a former employer or third party that are not in the public domain or have not been legally transferred or licensed to the Company.
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6. DUTY OF LOYALTY. You understand that your employment with the Company requires your undivided attention and effort during normal business hours. While you are employed by the Company, you will not, without the Companys express prior written consent, (i) engage in any other business activity unless such activity is not competitive with the Group and does not materially interfere with your full-time employment hereunder (as determined in good faith by the good faith board of directors of the Company (after consultation with the Companys Chief Executive Officer), (ii) be engaged or interested, directly or indirectly, alone or with others, in any trade, business or occupation in competition with the Group, (iii) make preparations, alone or with others, to compete with the Group in the future, or (iv) appropriate for your own benefit business opportunities pertaining to the Groups business. The obligations imposed on you under the Section 6 are in addition to, and do not supplant, any similar obligations you may have to the Group under the common law or by statute.
7. DUTY OF NON INTERFERENCE. For purposes of this Section, solicit means any direct or indirect communication of any kind, regardless of who initiates it, that in any way invites, advises, encourages or requests any person to take or refrain from taking any action.
7.1 Non-Solicitation of Employees/Consultants. During your employment with the Group and for a period of two (2) years thereafter, you will not directly or indirectly hire, attempt to hire, recruit, offer employment, lure or entice away, or in any other manner persuade or otherwise solicit anyone who is then an employee or consultant of the Group (or who was an employee or consultant of the Group within the six months preceding the date of any such prohibited conduct) to resign from the Group or to apply for or accept employment with, or otherwise provide services to, you or any third party, for your own benefit or for the benefit of any other person or entity.
7.2 Non-Solicitation of Customers. During your employment with the Company and for a period of two years (2) year thereafter, you will not, whether as an owner, employee, member, director, officer, trustee, agent, contractor, consultant or otherwise, directly or indirectly (i) solicit or accept from any Customer or Potential Customer (as defined below) any business involving the sale or provision of Restricted Products (as defined in section 7.3); (ii) request or advise any Customer of the Group to curtail, cancel, or withdraw its business from the Group; or (iii) aid in any way any other entity in obtaining business from any Customer or Potential Customer involving the sale or provision of Restricted Products (as defined in section 7.3). Customer means any person or entity who is or was, during the last 24 months of your employment with the Company (including any period of employment with any predecessor of the Company) either (a) a customer of the Company or (b) a customer of any Group company and, (c) with whom you dealt on behalf of the Company or a Group member or their predecessor; (d) whose dealings with the Company or a Group member or their predecessor were coordinated or supervised by you; (e) about whom you obtained Proprietary Information as a result of your association with the Company or a Group member or their predecessor; or (f) to whom you provided services on behalf of the Company or a Group member or their predecessor.
Potential Customer means any person or entity (a) with whom you were directly involved in the solicitation or targeting of such potential customer or to whom you provided services on behalf of any Group company during the six months preceding the termination of your employment or (b) about whom you became privy to Proprietary Information as a result of your employment during the last six months of your employ.
7.3 Non-Competition. During your employment with the Company and for a period of two (2) years thereafter (the Restricted Period), you will not hold any position or role outside the Company or the Group, whether such position or role be an employee, officer, director, consultant, owner, manager, advisor, investor, or otherwise, through which you would, directly or indirectly, provide competing services with the business of the Group or that would enable you or another third party to unfairly compete with the business of the Group. By way of limitation to the foregoing, the following shall be considered competitive with the business of the Group: (i) the provision of services with respect to or the sale of Restricted Products, within 50 miles of any Group Customer, (ii) the provision of services with respect to or sale of Restricted Products within 50 miles of any Group Office or (iii) the research, development, manufacturing or distribution of Restricted Products that will be sold within 50 miles of any Group Customer or Group Office. For purposes of this section, Restricted Products means products or services (a) which are of the same or materially similar kind as the products or services (including but not limited to technical and product support, professional services, technical advice and other customer services) researched into, developed, manufactured, distributed, sold or supplied by the Group and (b) (1) with which you were directly connected during your employment with the Company or its predecessor or (2) about which you have received or developed Proprietary Information by reason of your employment with the Company or its predecessor or provision of services to any member of the Group. Group Customer means a customer with respect to which you provided services, had business dealings or about which you received or developed Proprietary Information. Group Office means an office of the Company or a Group company with respect to which you provided services, had business dealings or about which you received or developed Proprietary Information. Notwithstanding the foregoing, by providing prior notice to the Company you may accept employment or otherwise be engaged in or involved with a competitor of the Group that has multiple lines of business provided that, during the Restricted Period, you are employed by a business unit of such competitor that is not engaged or otherwise involved with Restricted Products OR you are providing services to the competitor that are unrelated to the services you provided to the Company and that will not confer an unfair business advantage to such competitor by virtue of the Proprietary Information in your possession. Nothing contained in this Section 7 shall prohibit you from owning of a passive investment interest of not more than 2.5% in a company with publicly traded equity securities, and whether on your own behalf or on behalf of others. You agree that the Restricted Period shall be extended by a period equal the length of any violation of this Section 7.3.
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8. OBLIGATIONS UPON TERMINATION.
8.1 Return of Company Property. At the time of leaving the employ of the Company, you will deliver to the Company (and will not keep in your possession or deliver to anyone else) (i) any and all documents and materials of any nature (including physical and electronic copies) pertaining to your work, including without limitation devices, records, data, notes, reports, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, equipment, other documents or property, or reproductions of any aforementioned items and (ii) all property belonging to the Group or any third party which provided property to you in connection with your employment such as computer, laptops, personal digital assistants, cell phones, MP3 players, electronic organizers and other devices, cards, car, keys, security devices or any other item belonging to the Group. Upon Company request, you will execute a document confirming your compliance with this provision and the terms of this Agreement.
8.2 Notification of New Employer. Before you accept employment or enter in to any consulting or other professional or business engagement with any other person or entity while any of Section 7 is in effect, you will provide such person or entity with written notice of the provisions of Section 7 and will deliver a copy of the notice to the Company. You hereby grant consent to notification by the Company to your new employer about your rights and obligations under this Agreement.
8.3 Withholding. To the extent allowed by law and permitted by Section 409A of the Internal Revenue Code, you agree to allow Company to deduct from your final paycheck(s) any amounts payable by you as a result of your employment, including but not limited to, any expense advances or business charges incurred by you on behalf of the Group, charges for property damaged or not returned when requested, and any other charges incurred by you payable to the Group. You agree to execute any authorization form as may be provided by Company to effectuate this provision.
9. AT WILL EMPLOYMENT.
This Agreement does not constitute a contract of employment for any definite period of time. You acknowledge and agree that nothing in this Agreement modifies the at-will nature of your employment with Company, which permits either yourself or Company to terminate your employment at any time and without cause.
10. ARBITRATION.
10.1 In the event of any controversy or dispute between you and the Company or between you and any affiliate or an agent of Company, including but not limited to directors, officers, managers, other employees or members of the Group, who are being sued in any capacity, as to all or any part of this Agreement, any other agreement, any dispute or controversy whatsoever pertaining to or arising out of the relationship between you and the Company and/or the Group or the dissolution or termination of same, and/or the arbitrability thereof (collectively, Arbitrable Disputes as further defined
below) shall, subject to Section 11.1 herein, be resolved exclusively by binding arbitration solely between yourself and the Company and/or person or entity described above, conducted in Washington, D.C. The arbitration shall be governed by the Federal Arbitration Act, 9 U.S.C. Section 1 et seq, as amended, and shall be administered in accordance with the procedures set forth in the Dispute Resolution Addendum appended hereto as Schedule 2 (the Addendum), all of which are incorporated into this Agreement by this reference.
10.2 Arbitrable Disputes shall include any and all disputes not specifically exempted from arbitration herein, including, but not limited to, any alleged violations of federal, state or local constitutions, statutes, laws, ordinances, regulations or common law, any claims of wrongful termination, unlawful discrimination, harassment or retaliation, including but not limited to Title VII of the 1964 Civil Rights Act, The Equal Pay Act, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the Fair Labor Standards Act and similar state and local statutes, any claims of breach of contract or any implied covenant of good faith and fair dealing, any claims of adverse treatment in violation of public policy, and any disputes arising from, under or regarding this Agreement, including the formation, validity, interpretation, effect or breach of the Agreement. For avoidance of doubt, all disputes regarding the validity of this Agreement, the validity of the arbitration provisions of this Agreement, or whether any particular claim or matter is included within the scope of the arbitration provisions of this Agreement, are Arbitrable Disputes subject to arbitration as described herein.
Specifically excluded from Arbitrable Disputes are disputes or claims arising from or related to workers compensation and unemployment insurance, and any claims which are expressly excluded from binding arbitration by statute or public policy, or which are expressly required to be arbitrated under a different procedure.
10.3 While you are not required to do so before serving an arbitration demand under Section (g) of the Addendum, nothing in this Agreement shall prevent you from filing or maintaining an administrative charge or complaint with a government agency, including but not limited to, the Equal Employment Opportunity Commission, the Department of Labor and the National Labor Relations Board or any equivalent state or local agency. For the avoidance of doubt, if you choose not to file an administrative charge or complaint before commencing an arbitration in accordance with this Section 10 and the Addendum, your arbitration demand must be served, subject to Section 10.5, within the applicable time period for filing a charge with the relevant agency in order to be timely filed.
10.4 This binding arbitration procedure shall supplant and replace claims in court (except as specified herein), and you expressly waive the right to a civil court action before a jury.
10.5 In accordance with Section (g) of the Addendum and to the extent permitted by applicable law, any arbitration relating to or arising from any Arbitrable Dispute shall be commenced by service of an arbitration demand on or before the earlier of: (i) the expiration of the limitations period provided by applicable law; or (ii) the one-year anniversary of the accrual of the aggrieved partys claim.
Page 5 of 12
Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement Virginia
10.6 All Arbitrable Disputes under this Agreement must be brought in your individual capacity, and not as a plaintiff or class member in any purported class, representative or collective proceeding. You agree that the arbitrator is not empowered to consolidate claims of different individuals into one proceeding, or to hear an arbitration as a class arbitration. To the extent the arbitrator determines that this class/collective action waiver is invalid, for any reason, this entire Section 10 shall be null and void but only with regard to that particular proceeding in which the arbitrator invalidated this class/collective action waiver and this Section 10 shall remain in full force and effect with respect to any Arbitrable Disputes other than that covered by such class/collective action proceeding.
10.7 Notwithstanding the foregoing, the waiver of the jury trial right shall survive even in the event this Section 10 is deemed null and void.
11. GENERAL
11.1 Injunctive Relief. Notwithstanding the arbitration provisions in Section 10 or anything else to the contrary in this Agreement, you and the Company understand and agree that the parties actions or potential actions concerning obligations under Sections 2, 3, 4, 6 or 7 of this Agreement may result in irreparable and continuing damage to the other party for which monetary damages will not be sufficient, and agree that both parties will be entitled to seek, in addition to its other rights and remedies hereunder or at law and both before or while an arbitration is pending between the parties under Section 10 of this Agreement, a temporary restraining order, preliminary injunction or similar injunctive relief from a court of competent jurisdiction in order to preserve the status quo or prevent irreparable injury pending the full and final resolution of the dispute through arbitration, without the necessity of showing any actual damages or that monetary damages would not afford an adequate remedy, and without the necessity of posting any bond or other security. The aforementioned injunctive relief shall be in addition to, not in lieu of, legal remedies, monetary damages or other available forms of relief through arbitration proceedings. This Section shall not be construed to limit the obligation for either party to pursue arbitration under Section 10 with respect to any Arbitrable Disputes.
11.2 Waiver of Breach. The failure of Company at any time, or from time to time, to require performance of any of your obligations under this Agreement shall not be deemed a waiver of and shall in no manner affect Companys right to enforce any provision of this Agreement at a subsequent time. The waiver by Company of any rights arising out of any breach shall not be construed as a waiver of any rights arising out of any subsequent breach.
11.3 Non Disparagement, During and after your employment with the Company, except to the extent compelled or required by law, you agree you shall not disparage the Group, its customers and suppliers or their respective officers, directors, agents, servants, employees, attorneys, shareholders, successors or assigns or their respective products or services, in any manner (including but not limited to, verbally or via hard copy, websites, blogs, social media forums or any other medium); provided, however, that nothing in this Section shall prevent you from: engaging in concerted activity relative to the terms and conditions of your employment and in communications protected under the National Labor Relations Act, filing a charge or providing information to any governmental agency, or from providing information in response to a subpoena or other enforceable legal process or as otherwise required by law.
11.4 Applicable Law. This Agreement shall be governed by the laws of the State of Virginia, irrespective of its choice of law rules.
11.5 Entire Agreement. This Agreement along with Schedules 1 and 2 and the documents referred to herein constitute the entire agreement and understanding of the parties with respect to the subject matter of this Agreement, and supersede all prior understandings and agreements, whether oral or written, between or among the parties hereto with respect to the specific subject matter hereof. [Notwithstanding the foregoing, this Agreement does not supplant any rights the Group may have under the common law or by statute. Additionally, and notwithstanding the above language of this Section 11.6, you acknowledge and agree that the restrictive covenants you executed in favor of Cvent, Inc. (the Prior Agreement) shall remain in full force and effect; however, in the event of any inconsistency between the Prior Agreement and this Agreement, the terms and provisions of this Agreement and its attachments shall govern.] If any of Section 7 of this Agreement is deemed void, voidable, or otherwise invalid in legal proceedings, you agree that you shall comply with, and the Company may seek to enforce such provisions of the Prior Agreement against you. Headings are provided for convenience only and do not modify, broaden, define or restrict any provision. No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, will be effective unless in writing signed by the parties.
11.6 Survival. Any termination of this Agreement, regardless of how such termination may occur, shall not operate to terminate Sections 2, 3, 4, 5, 7, 8, 10 and 11 which shall survive any such termination and remain valid, enforceable and in full force and effect.
[SIGNATURE PAGE FOLLOWS]
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Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement - Ohio
CVENT, INC. | ||||
By: /s/ Brian N. Sheth | By: /s/ Rajeev Aggarwal | |||
Name: Brian N. Sheth | Name of employee: Rajeev Aggarwal | |||
Title: Chairman of the Board | Date: 6/9/17 | |||
Date: June 9, 2017 |
Page 7 of 12
EXHIBIT B
Certain Definitions
Cause means any of the following: (i) a material failure by you to perform your responsibilities or duties to the Company under this letter or those other responsibilities or duties as requested from time to time by the Board, after demand for performance has been given by the Board that identifies how you have not performed your responsibilities or duties; (ii) your engagement in illegal or improper conduct or in gross misconduct; (iii) your commission or conviction of, or plea of guilty or nolo contendere to, a felony that the Board in good faith believe will not materially harm the standing and reputation of the Company; (iv) your commission or conviction of, or plea of guilty or nolo contendere to, any felony other than the type set forth in clause (iii), a crime involving moral turpitude or any other act or omission that the Company in good faith believes may harm the standing and reputation of the Company; (v) a material breach of your duty of loyalty to the Company or your material breach of the Companys written code of conduct and business ethics or Section 2 through 8 of the Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement, or any other agreement between you and the Company; (vi) dishonesty, fraud, gross negligence or repetitive negligence committed without regard to corrective direction in the course of discharge of your duties as an employee; or (vii) excessive and unreasonable absences from your duties for any reason (other than authorized vacation or sick leave) or as a result of your Disability (as defined below).
Disability means your inability to perform the essential functions of your job, with or without accommodation, for an extended period but not less than 60 business days in any consecutive 6 month period, as determined in the sole discretion of the Company.
Good Reason means that you voluntarily terminate your employment with the Company if there should occur, without your written consent:
(i) a material, adverse change in your duties or responsibilities with the Company, provided that a change in title or a change in the person or office to which you report, shall not, by itself, constitute such a material, adverse change;
(ii) relocation of your principal place of employment by more than 35 miles;
(iii) a reduction in the Initial Base Salary by more than 10% in the aggregate during the term of your employment under this letter or a reduction in your base salary by less than 10% which is not applied to similarly ranked employees; and/or
(iv) the material breach by the Company of any offer letter or employment agreement between you and the Company.
provided, however, that in each case above, (i) you must first give the Company written notice of any of the foregoing within thirty (30) business days following the first occurrence of such event in a written explanation specifying the basis for your belief that you are entitled to terminate your employment for Good Reason, (ii) the Company must have thirty (30) days to cure such event and (iii) provided that the Company does not reasonably cure such event, you must actually resign your employment within ten (10) days following the cure period described in (ii). Otherwise, any claim of such circumstances as Good Reason shall be deemed irrevocably waived by you.
All references to the Company in these definitions shall include parent, subsidiary, affiliate and successor entities of the Company.
Exhibit 10.15
June 6, 2017
Charles Ghoorah
[***]
Re: |
Employment with Cvent, Inc. |
Dear Charles:
This is your employment agreement with Cvent, Inc., a Delaware corporation (as such companys name may change from time to time and such companys successors and assigns, the Company). It sets forth the terms of your continued employment by the Company, which shall be effective as of the closing (the Closing) of the transactions (the Transaction) contemplated by that certain Agreement and Plan of Merger, dated as of April 17, 2016, by and among the Company, Papay Holdco, LLC, a Delaware limited liability company (Parent) and Papay Merger Sub, Inc., a Delaware corporation, pursuant to which the Company became a wholly-owned subsidiary of Parent on November 29, 2016 (the Closing Date). We are very excited about this opportunity and value the role that you will serve on our team going forward.
1. You will be the President, Worldwide Sales and Marketing of the Company, reporting to the Chief Executive Officer of the Company, or any other officer as directed by the Board of Directors of the Company (the Board) with the consent of the Chief Executive Officer. In this capacity, you will have the responsibilities and duties consistent with such position.
2. Effective as of March 1, 2017, your base salary will be $277,062.00 per year (the Initial Base Salary), less deductions and withholdings required by law or authorized by you. The Chief Executive Officer and Board of Directors agree to reassess your base salary from a market perspective in November 2017 and will, based on company and individual performance, determine if you are eligible for an increase effective as of November 29, 2017. If your base salary is not raised as of November 29, 2017, then your next annual base salary review will occur during the 2017 performance year review process, with any compensation changes effective March 1, 2018. If your base salary is raised as of November 29, 2017, then your next annual base salary review will occur during the 2018 performance year review process, with any compensation changes effective March 1, 2019, and thereafter will be subject to review annually for any increases or decreases; provided, however, that the aggregate amount of any decreases during the course of your employment hereunder shall not be greater than 10% of the Initial Base Salary, and any such decreases may only be implemented in conjunction with a general decrease affecting the executive management team. Your base salary will be paid by the Company in regular installments in accordance with the Companys general payroll practices as in effect from time to time.
For the bonus period beginning on January 1, 2017, you will be eligible to receive an annual bonus (the Bonus) with a target amount equal to $67,767.00. The Bonus will be awarded at the sole discretion of the Board, based upon the Boards and the Companys Chief Executive Officers mutual determination as to your achievement of predetermined thresholds, which may include management by objectives (MBO) targets and financial targets such as bookings, revenue, recurring revenue, gross profit and/or EBITDA targets. In addition, you may be eligible for an additional stretch bonus (the Stretch Bonus), awarded at the discretion of the Board and the Companys Chief Executive Officer, based on the Boards and the Companys Chief Executive Officers mutual determination as to your achievement of stretch targets.
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With respect to bonus periods beginning on and after January 1, 2018, the bonus formulas, MBOs, performance milestones and all other elements of your bonus opportunities shall be established by the Board, in its sole discretion, and communicated in writing (including email) to you from time to time. Each annual bonus earned for a fiscal year shall be paid within 30 days after the Board has received, reviewed and approved the applicable fiscal years final audited financial statements. In any event, payment of any bonus that becomes due with respect to a fiscal year shall be paid in the calendar year following the calendar year in which the fiscal year ends, subject, in each case, to your continued employment on the applicable payment date.
In addition to base salary and bonus compensation, you will be eligible to receive a sales commission based on your performance. Commission payments are earned pursuant to the Cvent Commission Plan established by the Chief Executive Officer, in his sole discretion, and communicated in writing (including email) to you from time to time.
3. You will also be eligible to participate in health, dental and vision insurance plans and other employee benefit plans established by the Company or its affiliates for their employees from time to time, in accordance with the terms of such plans, so long as they remain generally available to such employees.
4. During your employment, your position shall be based in Tysons Corner, Virginia. Your duties may involve extensive domestic and international travel.
5. You received options (the Options) to purchase 10,787.00 shares of Papay Topco, Inc. (Topco), which shall be issued under Topcos 2017 Stock Option Plan (as amended, restated or otherwise modified from time to time, the Option Plan) pursuant to an Option Grant Agreement entered into on or about May 26, 2017.
6. There are some formalities that you need to complete as a condition of your employment:
You must carefully consider and sign the Companys standard Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement (attached to this letter as Exhibit A). Because the Company and its affiliates are engaged in a continuous program of research, development, production and marketing in connection with their business, we wish to reiterate that it is critical for the Company and its affiliates to preserve and protect their proprietary information and their rights in inventions.
So that the Company has proper records of inventions that may belong to you, we ask that you also complete Schedule 1 attached to Exhibit A.
You and the Company mutually agree that any disputes that may arise regarding your employment will be submitted to binding arbitration pursuant to the arbitration clause set forth in Section 10 of Exhibit A. As a condition of your employment, you will need to carefully consider and voluntarily agree to the arbitration clause set forth in Section 10 of Exhibit A.
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7. We also wish to remind you that, as a condition of your employment, you are expected to abide by the Companys, its subsidiaries and affiliates written policies and procedures, which may be amended from time to time, at the Companys sole discretion.
8. Your employment with the Company is at will. The Company may terminate your employment at any time with or without notice, and for any reason or no reason. You shall be entitled to terminate your employment with the Company at any time and for any reason or no reason by giving notice in writing to the Company of not less than eight (8) weeks (Notice Period), unless otherwise agreed to in writing by you and the Company. In the event of such notice, the Company reserves the right, in its discretion, to give immediate effect to your resignation in lieu of requiring or allowing you to continue to work throughout the Notice Period; provided that, you will receive a cash payment equal to the base salary you would have otherwise earned during the remaining portion of the Notice Period had the Company not given immediate effect to your resignation. You shall continue to be an employee of the Company during the Notice Period, and thus owe to the Company the same duty of loyalty you owed it prior to giving notice of your termination. The Company may, during the Notice Period, relieve you of all of your duties and prohibit you from entering the Companys offices.
9. If the Company terminates your employment without Cause or you voluntarily terminate your employment for Good Reason, you will be entitled to receive (x) a severance payment equal to 12 months of your then applicable base salary, less deductions and withholdings required by law or authorized by you (the Severance Pay) (y) solely to the extent approved in writing by the Board and the Chief Executive Officer, a prorated portion of any bonus that you otherwise would have earned during the fiscal year in which such termination occurs had your employment continued and (z) reimbursement of any COBRA premiums you paid for continued health coverage during the 12 month period following the termination of your employment. For purposes of this section, Cause and Good Reason have the meaning set forth in Exhibit B attached hereto. The Company will not be required to pay the Severance Pay unless (i) you execute and deliver to the Company an agreement (Release Agreement) in a form satisfactory to the Company releasing from all liability (other than the payments and benefits contemplated by this letter) the Company, each member and affiliate of the Company, and any of their respective past or present investors, members, officers, directors, managers, employees or agents, which Release Agreement will not contain any additional non-disparagement, non-solicitation or non-competition obligations, and you do not revoke such Release Agreement during any applicable revocation period, (ii) such Release Agreement is executed and delivered (and no longer subject to revocation, if applicable) within 60 days following termination, and (iii) you continue to comply with the provisions of Sections 2 through 8 of Exhibit A, the terms of this letter and any restrictive covenant agreement between you and the Company and the provisions of the Release Agreement. The Severance Pay shall be paid in installments in accordance with the Companys general payroll practices at the time of termination, but no less frequently than monthly, starting on the sixtieth (60th) day following your termination of employment, provided you have executed, delivered, and not revoked the Release Agreement during such revocation period for the Release Agreement described above. For the avoidance of doubt, you shall not be required to mitigate the payments provided to you under this Section 9 by seeking other employment or engagement, nor shall, except as set forth in this Section 9, any amounts paid to you under this Section 9 be reduced by any other compensation earned by you.
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10. You shall not make any statement that would libel, slander or disparage the Company, any member of the Company or its affiliates or any of their respective past or present officers, directors, managers, stockholders, employees or agents, provided that the foregoing shall not prohibit you from (i) making truthful statements in response to legal process, required governmental testimony or filings, or administrative or arbitral proceedings (including, without limitation, depositions in connection with such proceedings), (ii) making statements that you in good faith believe are necessary or appropriate to make in connection with performing your duties and obligations to the Company, (iii) engaging in concerted activity relative to the terms and conditions of your employment or (iv) in communications protected under the National Labor Relations Act, or from filing a charge or providing information to any governmental agency.
11. While we look forward to a long and profitable relationship, you will be an at-will employee of the Company as described in Section 8 of this letter. Any statements or representations to the contrary (and, indeed, any statements contradicting any provision in this letter) are, and should be regarded by you, as ineffective. Further, your participation in any benefit program or other Company program, if any, is not to be regarded as assuring you of continuing employment for any particular period of time.
12. It should also be understood that all offers of employment are conditioned on the Companys completion of a satisfactory background check. The Company reserves the right to perform background checks during the term of your employment, subject to compliance with applicable laws. You will be required to execute forms authorizing such a background check. In the event that the Company terminates your employment hereunder due to an unsatisfactory background check, notwithstanding anything herein to the contrary, you will be entitled to the Severance Pay, subject to the conditions set forth in Section 9.
13. Section 280G of the Internal Revenue Code
a In the event that any payment, coverage or benefit provided in respect of your employment with the Company and its affiliates, whether under this letter or otherwise and whether before or after termination of your employment (the Payments), would be subject to the Excise Tax (as defined below), but the imposition of the Excise Tax could be avoided by approval of shareholders described in Section 280G(b)(5)(B) of the Internal Revenue Code of 1986, as amended (the Code), then you may cause the Company or any applicable affiliate of the Company to seek such approval, in which case the Company and any such affiliate will use their reasonable best efforts to cause such approval to be obtained and you will cooperate and execute such waivers as may be necessary so that such approval avoids imposition of any Excise Tax.
b In the event that any Payment could reasonably be expected to be subject to the Excise Tax and either (i) you do not elect to cause the Company or any applicable affiliate to seek approval of shareholders described in Section 280G(b)(5)(B) of the Code or (ii) such approval would not avoid the imposition of the Excise Tax, then the Company shall reduce (but not below zero) the aggregate present value of the Payments to the Reduced Amount (as defined below), if
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reducing the Payments will provide you with a greater net after-tax amount than would be the case if no such reduction was made. The Payments shall be reduced as described in the preceding sentence only if (a) the net amount of the Payments, as so reduced (and after subtracting the net amount of federal, state and local income and payroll taxes on the reduced Payments), is greater than or equal to (b) the net amount of the Payments without such reduction (but after subtracting the net amount of federal, state and local income and payroll taxes on the Payments and the amount of Excise Tax to which you would be subject with respect to the unreduced Payments). Any reduction shall be made in accordance with Section 409A of the Code.
c For purposes of this Section 13, the term Reduced Amount shall be an amount expressed in present value that maximizes the aggregate present value of Payments without causing any Payments to be subject to the Excise Tax, determined in accordance with Section 280G(d)(4) of the Code, and the term Excise Tax means the excise tax imposed under Section 4999 of the Code, together with any interest or penalties imposed with respect to such excise tax.
d All determinations to be made under this Section 13 shall be made by an independent registered public accounting firm or consulting firm selected by the Company and consented to by you immediately prior to a change in control, which shall provide its determinations and any supporting calculations both to the Company and you within 15 days prior to the change in control. All fees and expenses of the accounting or consulting firm in performing the determinations referred to in this Section 12 shall be borne solely by the Company.
14. This letter along with its Exhibits and the documents referred to herein constitute the entire agreement and understanding of the parties with respect to the subject matter of this letter, and supersede all prior understandings and agreements, including but not limited to employment agreements, severance agreements, and bonus agreements, whether oral or written, between or among you and the Company, Parent or any of their respective predecessors or affiliates with respect to the specific subject matter hereof Waivers or modifications of this letter are valid only if in writing and duly executed by each of the parties hereto.
15. In the event of a conflict between the terms of this letter and the provisions of Exhibit A, the terms of this letter shall prevail.
16. Notwithstanding any other provision herein, the Company shall be entitled to withhold from any amounts otherwise payable hereunder any amounts required to be withheld in respect to federal, state or local taxes. The intent of the parties is that payments and benefits under this letter be exempt from, or comply with, Code Section 409A and the regulations and guidance promulgated thereunder (collectively Code Section 409A) and, accordingly, to the maximum extent permitted, this letter shall be interpreted to be in compliance therewith. In no event whatsoever shall the Company be liable for any additional tax, interest or penalty that may be imposed on you by Code Section 409A or damages for failing to comply with Code Section 409A. To the extent required by Code Section 409A, a termination of employment shall not be deemed to have occurred for purposes of any provision of this letter providing for the payment of any amounts or benefits upon or following a termination of employment unless such termination is also a separation from service within the meaning of Code Section 409A and, for purposes of any such provision of this letter, references to a termination, termination of employment or like terms shall mean separation from service. For purposes of Code Section 409A, your right
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to receive any installment payments pursuant to this letter shall be treated as a right to receive a series of separate and distinct payments. To the extent that reimbursements or other in-kind benefits under this letter constitute nonqualified deferred compensation for purposes of Code Section 409A, (a) all such expenses or other reimbursements hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by you, (b) any right to such reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit, and (c) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year. Notwithstanding anything in this letter to the contrary, if you are a specified employee for purposes of Code Section 409A and if payment of any amounts under this letter is required to be delayed for a period of six months after separation from service pursuant to Code Section 409A, payment of such amounts shall be delayed as required by Code Section 409A, and the accumulated amounts shall be paid in a lump sum payment within 15 days after the end of the six-month period, or if earlier, upon your death.
If you decide to accept the terms of this letter, and I hope you will, please signify your acceptance of these conditions of employment by signing and dating the enclosed copy of this letter and Exhibit A and returning them to me, not later than June 9, 2017. Should you have anything that you wish to discuss, please do not hesitate to contact me at.
* * * *
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By signing this letter and Exhibit A attached hereto, you represent and warrant that you have had the opportunity to seek the advice of independent counsel before signing and have either done so, or have freely chosen not to do so, and either way, you sign this letter voluntarily.
Very truly yours, |
/s/ Rajeev Aggarwal |
Rajeev Aggarwal |
Chief Executive Officer |
I have read and understood this letter and Exhibit A attached and hereby acknowledge, accept and agree to the terms set forth therein.
/s/ Charles Ghoorah |
Date signed: |
6/9/17 |
||||
Charles Ghoorah |
LIST OF EXHIBITS
Exhibit A: Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement
Exhibit B: Certain Definitions
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EXHIBIT A
CONFIDENTIALITY, INVENTION ASSIGNMENT, NON-SOLICIT, NON-COMPETE AND ARBITRATION AGREEMENT
As a condition of your employment and/or continued employment with Cvent, Inc. (as such companys name may change from time to time and such companys successors and assigns, the Company), and in exchange for the other and valuable consideration recited in Section 1 below, you and the Company agree to the following:
For purposes of this Agreement, references to the Group means the Company, and its affiliates (whether a parent, subsidiary, or sister entity to the Company) engaged in the same line of business or contemplated business as the Company.
1. CONSIDERATION FOR AGREEMENT.
You understand that the Group is engaged in a continuous program of research, development, production and marketing in connection with its business and that it is critical for the Group to preserve and protect its Proprietary Information (as defined in Section 2 below), its rights in Inventions (as defined in Section 4 below) and in all related intellectual property rights. You acknowledge that, as a result of your employment with the Company and/or its predecessors, you have and/or may receive confidential information, trade secrets, and/or specialized training from the Group, each of which constitutes good and valuable consideration in support of your obligations made under this Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement (this Agreement). As additional consideration, you may also have the opportunity to develop valuable business relationships with employees, agents, suppliers, and customers of the Group and to use the Groups resources and goodwill in the marketplace to develop those relationships. Finally, by your signature below, you acknowledge that both the consideration outlined in your offer of employment from the Company and/or the letter to which this Agreement is attached and your continued employment with the Company (subject to Section 9), which the Company would not allow but for your execution of this Agreement, constitute additional consideration in support of your return promise to maintain the confidentiality of all specialized knowledge and confidential information as well as your promise to adhere to the other restrictions listed in this Agreement, including but not limited to those restrictions described in Section 7 of this Agreement.
2. PROPRIETARY INFORMATION.
You understand that your employment creates a relationship of confidence and trust with respect to any information of a confidential or secret nature that may be disclosed to you or created by you that relates to the business of the Group or to the business of its customers, licensees, suppliers or any other party with whom the Group agrees to hold information of such party in confidence (the Proprietary Information).
You understand and agree that the term Proprietary Information includes but is not limited to information of all types contained in any medium (paper, electronic, in your memory, or otherwise stored or recorded), whether oral or written and regardless of whether it is marked as confidential,
proprietary or a trade secret. Proprietary Information includes, without limitation, the following information and materials, whether having existed, now existing or developed or created by you or on your behalf during your term of employment with the Company or its predecessor:
A) |
All information and materials relating to the existing software products and software in the various stages of research and development, including, but not limited to, source codes, object codes, design specifications, design notes, flow charts, graphics, graphical user interfaces, coding sheets, product plans, know-how, negative know how, test plans, business investment analysis, marketing and functional requirements, algorithms, product bugs and customer technical support cases which relate to the software; |
B) |
Internal business information, procedures and policies, including, but not limited to, licensing techniques, vendor names, other vendor information, business plans, financial information, budgets, forecasts, product margins, product costs, service and/or operation manuals and related documentation including drawings, and other such information, whether written or oral, which relates to the way the Group conducts its business; |
C) |
All legal rights, including but not limited to, trade secrets, pending patents, Inventions (as that term is defined in Section 4 below) and other discoveries, claims, litigation and/or arbitrations involving the Group, pending trademarks, copyrights, proposed advertising, public relations and promotional campaigns and like properties maintained in confidence; |
D) |
Any and all customer sales and marketing information, including but not limited to sales forecasts, marketing and sales promotion plans, product launch plans, sales call reports, competitive intelligence information, customer information, customer lists, customer needs and buying habits, sales and marketing studies and reports, internal price list, discount matrix, customer data, customer contracts, pricing structures, customer negotiations, customer relations materials, customer service materials, past customers, and the type, quantity and specifications of products purchased, leased or licensed by customers of the Group; |
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Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement Virginia
E) |
Any information obtained while working for the Group which gives the Group a competitive edge; |
F) |
Any other knowledge or information regarding the property, business, and affairs of the Group which the Group endeavors to keep confidential or which the Group believes to be confidential; and |
G) |
Any and all other trade secrets, as that term is defined under applicable laws. |
You understand and agree to treat and preserve Proprietary Information and materials as strictly confidential. Except as authorized by the Companys Chief Executive Officer (but in all cases preserving confidentiality by following Company policies and obtaining appropriate non-disclosure agreements), you further agree that, during your employment with the Company or thereafter, you will not directly or indirectly transmit or disclose Proprietary Information to any person, corporation, or other entity for any reason or purpose whatsoever, except in connection with the performance of your employment duties.
You understand and agree that the Proprietary Information is the exclusive property of the Group, and that, during your employment, you will use and disclose Proprietary Information only for the Groups benefit and in accordance with any restrictions placed on its use or disclosure by the Group. After termination of your employment for any reason, you will not use in any manner or disclose any Proprietary Information, except to the extent compelled by applicable law; provided that in the event you receive notice of any effort to compel disclosure of Proprietary Information for any reason, you will promptly and in advance of disclosure notify Company of such notice and fully cooperate with all lawful Company or Group efforts (through their counsel or otherwise) to resist or limit such disclosure.
Proprietary Information does not include information (i) that was or becomes generally available to you on a non-confidential basis, if the source of this information was not reasonably known to you to be bound by a duty of confidentiality, or (ii) that was or becomes generally available to the public, other than as a result of a disclosure by you, directly or indirectly or any other breach of this Agreement.
3. THIRD PARTY INFORMATION. You recognize that the Group has received and in the future will receive from third parties their confidential or proprietary information subject to a duly on the Groups part to maintain the confidentiality of such information and to use it only for certain limited purposes. You agree that you owe the Group and such third parties, during the term of your employment, and thereafter, a duty to hold all such confidential or proprietary information in the strictest confidence and not to disclose it to any person, firm or corporation (except as necessary in carrying out your work for the Group consistent with the Groups agreement with such third party) or to use it for the benefit of anyone other than for the Group or such third party (consistent with the Companys agreement with such third party) without the express written
authorization of the Chief Executive Officer of the Company. All rights and benefits afforded to the Company under this Agreement shall apply equally to the owner of the third party information with respect to the third party information, and such third party is an intended third party beneficiary of this Agreement, with respect to the third party information. You further agree to conform to the Companys privacy policies, as amended from time to time.
4. INVENTIONS.
4.1 Prior Inventions. You have attached hereto as Schedule 1 a complete and accurate list describing all Inventions (as defined below) which were discovered, created, invented, developed or reduced to practice by you prior to the commencement of your employment by the Company and have not been legally assigned or licensed to the Company (collectively: Prior Inventions), which belong solely to you or belong to you jointly with others, which relates in any way to any of the Groups current, proposed or reasonably anticipated businesses, products or research or development and which are not assigned to the Group hereunder; or have initialed Schedule 1 to indicate you have no Prior Inventions to disclose.
If, in the course of your employment with the Company, you incorporate or cause to be incorporated into a Group product, service, process, file, system, application or program a Prior Invention owned by you or in which you have an interest, you hereby grant the Group member a non-exclusive, royalty-free, irrevocable, perpetual, worldwide, sublicensable and assignable license to make, have made, copy, modify, make derivative works of, use, offer to sell, sell or otherwise distribute such Prior Invention as part of or in connection with such product, process, file, system, application or program.
4.2 Disclosure of Inventions. You will promptly disclose in confidence to the Company all Inventions that you make or conceive or first reduce to practice or create, either alone or jointly with others, during the period of your employment, and for a period of three (3) months thereafter, whether or not in the course of your employment, and whether or not such Inventions are patentable, copyrightable or protectable as trade secrets. For purposes of this Agreement, Inventions means without limitation, formulas, algorithms, processes, techniques, concepts, designs, developments, technology, ideas, patentable and unpatentable inventions and discoveries, copyrights and works of authorship in any media now known or hereafter invented (including computer programs, source code, object code, hardware, firmware, software, mask work, applications, files, Internet site content, databases and compilations, documentation and related items) patents, trade and service marks, logos, trade dress, corporate names and other source indicators and the good will of any business symbolized thereby, trade secrets, know-how, confidential and proprietary information, documents, analyses, research and lists (including current and potential customer and user lists) and all applications and registrations and recordings, improvements and licenses related to any of the foregoing. You recognize that Inventions or Proprietary Information relating to your activities
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while working for the Company, and conceived, reduced to practice, created, derived, developed, or made by you, alone or with others, within three (3) months after termination of your employment may have been conceived, reduced to practice, created, derived, developed, or made, as applicable, in significant part while you were employed by the Company. Accordingly, you agree that such Inventions and Proprietary Information shall be presumed to have been conceived, reduced to practice, created, derived, developed, or made, as applicable, during your employment with the Company and are to be assigned to the Company pursuant to this Agreement and applicable law unless and until you have established the contrary by clear and convincing evidence.
4.3 Work for Hire, Assignment of Inventions. You acknowledge and agree that any copyrightable works prepared by you, either alone or jointly with others, within the scope of your employment are works made for hire under the Copyright Act and that the Company will be considered the author and owner of such copyrightable works. Any copyrightable works the Company or a Group member specially commissions from you while you are employed with the Company shall be deemed a work made for hire under the Copyright Act and if for any reason a work cannot be so designated as a work made for hire, you agree to and hereby assign to the Company all right, title and interest in and to said work(s) and the related copyright(s). You agree to and hereby grant the Company a non-exclusive, royalty-free, irrevocable, perpetual, worldwide, sublicensable and assignable license to make, have made, copy, modify, make derivative works of, use, publicly perform, display or otherwise distribute any copyrightable works you create during the time you are employed with the Company that for any reason do not qualify as a work made for hire, that were not specially commissioned by the Group, or both, but that relate in any way to the business of the Group. You agree that all Inventions that (i) are developed using equipment, supplies, facilities Proprietary Information, or trade secrets of the Group, (ii) result from work performed by you for the Group and/or on Company time, or (iii) relate to the Groups business or current or anticipated research and development (the Assigned Inventions), will be the sole and exclusive property of the Company and you agree to and hereby irrevocably assign the Assigned Inventions to the Company
4.4 Assignment of Other Rights. In addition to the foregoing assignment of Assigned Inventions to the Company, you hereby irrevocably transfer and assign to the Company: (i) all worldwide patents, patent applications, copyrights, mask works, trade secrets and other intellectual property rights in any Assigned Invention, and (ii) any and all Moral Rights (as defined below) that you may have in or with respect to any Assigned Inventions. You also hereby forever waive and agree never to assert any and all Moral Rights you may have in or with respect to any Assigned Inventions, even after termination of your work on behalf of the Company. Moral Rights mean any rights to claim authorship of any Assigned Inventions, to object to or prevent the modification of any Assigned Inventions, or to withdraw from circulation or control the
publication or distribution of any Assigned Inventions, and any similar right, existing under judicial or statutory law of any country in the world, or under any treaty, regardless of whether or not such right is denominated or generally referred to as a moral right.
4.5 Assistance. Whether during or after your employment, and without additional compensation, you agree to do any act and/or execute any document deemed necessary or desirable by the Company in furtherance of perfecting, prosecuting, recording, maintaining, enforcing and protecting the Groups right, title and interest in and to, any of the Assigned Inventions. In the event that the Company is unable for any reason to secure your signature to any document required to file, prosecute, register or memorialize the ownership and/or assignment of, or to enforce, any intellectual property, you hereby irrevocably designate and appoint the Companys duly authorized officers and agents as your agents and attorneys-in-fact to act for and on your behalf and stead to (i) execute, file, prosecute, register and/or memorialize the assignment and/or ownership of any Assigned Invention; (ii) to execute and file any documentation required for such enforcement and (iii) do all other lawfully permitted acts to further the filing, prosecution, registration, memorialization of assignment and/or ownership of, issuance of and enforcement of any Assigned Inventions, all with the same legal force and effect as if executed by you.
4.6 Applicability to Past Activities. To the extent you have been engaged to provide services by the Company or its predecessor for a period of time before the effective date of this Agreement (the Prior Engagement Period), you agree that if and to the extent that, during the Prior Engagement Period: (i) you received access to any information from or on behalf of the Company that would have been Proprietary Information if you had received access to such information during the period of your employment with the Company under this Agreement; or (ii) you conceived, created, authored, invented, developed or reduced to practice any item, including any intellectual property rights with respect thereto, that would have been an Invention if conceived, created, authored, invented, developed or reduced to practice during the period of your employment with the Company under this Agreement; then any such information shall be deemed Proprietary Information hereunder and any such item shall be deemed an Invention hereunder, and this Agreement shall apply to such information or item as if conceived, created, authored, invented, developed or reduced to practice under this Agreement.
5. NO BREACH OF PRIOR AGREEMENT. You represent that your performance of all the terms of this Agreement and your duties as an employee of the Company will not breach any invention assignment, proprietary information, confidentiality, noncompetition, nonsolicitation, noninterference, or similar agreement with any former employer or other party. You represent that you will not bring with you to the Company or use in the performance of your duties for the Company any documents or materials or intangibles of a former employer or third party that are not in the public domain or have not been legally transferred or licensed to the Company.
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6. DUTY OF LOYALTY. You understand that your employment with the Company requires your undivided attention and effort during normal business hours. While you are employed by the Company, you will not, without the Companys express prior written consent, (i) engage in any other business activity unless such activity is not competitive with the Group and does not materially interfere with your full-time employment hereunder (as determined in good faith by the good faith board of directors of the Company (after consultation with the Companys Chief Executive Officer), (ii) be engaged or interested, directly or indirectly, alone or with others, in any trade, business or occupation in competition with the Group, (iii) make preparations, alone or with others, to compete with the Group in the future, or (iv) appropriate for your own benefit business opportunities pertaining to the Groups business. The obligations imposed on you under the Section 6 are in addition to, and do not supplant, any similar obligations you may have to the Group under the common law or by statute.
7. DUTY OF NON INTERFERENCE. For purposes of this Section, solicit means any direct or indirect communication of any kind, regardless of who initiates it, that in any way invites, advises, encourages or requests any person to take or refrain from taking any action.
7.1 Non-Solicitation of Employees/Consultants. During your employment with the Group and for a period of two (2) years thereafter, you will not directly or indirectly hire, attempt to hire, recruit, offer employment, lure or entice away, or in any other manner persuade or otherwise solicit anyone who is then an employee or consultant of the Group (or who was an employee or consultant of the Group within the six months preceding the date of any such prohibited conduct) to resign from the Group or to apply for or accept employment with, or otherwise provide services to, you or any third party, for your own benefit or for the benefit of any other person or entity.
7.2 Non-Solicitation of Customers. During your employment with the Company and for a period of two years (2) year thereafter, you will not, whether as an owner, employee, member, director, officer, trustee, agent, contractor, consultant or otherwise, directly or indirectly (i) solicit or accept from any Customer or Potential Customer (as defined below) any business involving the sale or provision of Restricted Products (as defined in section 7.3); (ii) request or advise any Customer of the Group to curtail, cancel, or withdraw its business from the Group; or (iii) aid in any way any other entity in obtaining business from any Customer or Potential Customer involving the sale or provision of Restricted Products (as defined in section 7.3). Customer means any person or entity who is or was, during the last 24 months of your employment with the Company (including any period of employment with any predecessor of the Company) either (a) a customer of the Company or (b) a customer of any Group company and, (c) with whom you dealt on behalf of the Company or a Group member or their predecessor; (d) whose dealings with the Company or a Group member or their
predecessor were coordinated or supervised by you; (e) about whom you obtained Proprietary Information as a result of your association with the Company or a Group member or their predecessor; or (f) to whom you provided services on behalf of the Company or a Group member or their predecessor. Potential Customer means any person or entity (a) with whom you were directly involved in the solicitation or targeting of such potential customer or to whom you provided services on behalf of any Group company during the six months preceding the termination of your employment or (b) about whom you became privy to Proprietary Information as a result of your employment during the last six months of your employ.
7.3 Non-Competition. During your employment with the Company and for a period of two (2) years thereafter (the Restricted Period), you will not hold any position or role outside the Company or the Group, whether such position or role be an employee, officer, director, consultant, owner, manager, advisor, investor, or otherwise, through which you would, directly or indirectly, provide competing services with the business of the Group or that would enable you or another third party to unfairly compete with the business of the Group. By way of limitation to the foregoing, the following shall be considered competitive with the business of the Group: (i) the provision of services with respect to or the sale of Restricted Products, within 50 miles of any Group Customer, (ii) the provision of services with respect to or sale of Restricted Products within 50 miles of any Group Office or (iii) the research, development, manufacturing or distribution of Restricted Products that will be sold within 50 miles of any Group Customer or Group Office. For purposes of this section, Restricted Products means products or services (a) which are of the same or materially similar kind as the products or services (including but not limited to technical and product support, professional services, technical advice and other customer services) researched into, developed, manufactured, distributed, sold or supplied by the Group and (b) (1) with which you were directly connected during your employment with the Company or its predecessor or (2) about which you have received or developed Proprietary Information by reason of your employment with the Company or its predecessor or provision of services to any member of the Group. Group Customer means a customer with respect to which you provided services, had business dealings or about which you received or developed Proprietary Information. Group Office means an office of the Company or a Group company with respect to which you provided services, had business dealings or about which you received or developed Proprietary Information. Notwithstanding the foregoing, by providing prior notice to the Company you may accept employment or otherwise be engaged in or involved with a competitor of the Group that has multiple lines of business provided that, during the Restricted Period, you are employed by a business unit of such competitor that is not engaged or otherwise involved with Restricted Products OR you are providing services to the competitor that are unrelated to the services you provided to the Company and that will not confer an unfair business advantage to such competitor by virtue of the Proprietary Information in your possession. Nothing contained in this Section 7 shall
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prohibit you from owning of a passive investment interest of not more than 2.5% in a company with publicly traded equity securities, and whether on your own behalf or on behalf of others. You agree that the Restricted Period shall be extended by a period equal the length of any violation of this Section 7.3.
8. OBLIGATIONS UPON TERMINATION.
8.1 Return of Company Property. At the time of leaving the employ of the Company, you will deliver to the Company (and will not keep in your possession or deliver to anyone else) (i) any and all documents and materials of any nature (including physical and electronic copies) pertaining to your work, including without limitation devices, records, data, notes, reports, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, equipment, other documents or property, or reproductions of any aforementioned items and (ii) all property belonging to the Group or any third party which provided property to you in connection with your employment such as computer, laptops, personal digital assistants, cell phones, MP3 players, electronic organizers and other devices, cards, car, keys, security devices or any other item belonging to the Group. Upon Company request, you will execute a document confirming your compliance with this provision and the terms of this Agreement.
8.2 Notification of New Employer. Before you accept employment or enter in to any consulting or other professional or business engagement with any other person or entity while any of Section 7 is in effect, you will provide such person or entity with written notice of the provisions of Section 7 and will deliver a copy of the notice to the Company. You hereby grant consent to notification by the Company to your new employer about your rights and obligations under this Agreement.
8.3 Withholding. To the extent allowed by law and permitted by Section 409A of the Internal Revenue Code, you agree to allow Company to deduct from your final paycheck(s) any amounts payable by you as a result of your employment, including but not limited to, any expense advances or business charges incurred by you on behalf of the Group, charges for property damaged or not returned when requested, and any other charges incurred by you payable to the Group. You agree to execute any authorization form as may be provided by Company to effectuate this provision.
9. AT WILL EMPLOYMENT.
This Agreement does not constitute a contract of employment for any definite period of time. You acknowledge and agree that nothing in this Agreement modifies the at-will nature of your employment with Company, which permits either yourself or Company to terminate your employment at any time and without cause.
10. ARBITRATION.
10.1 In the event of any controversy or dispute between you and the Company or between you and any affiliate or an agent of Company, including but not limited to directors, officers,
managers, other employees or members of the Group, who are being sued in any capacity, as to all or any part of this Agreement, any other agreement, any dispute or controversy whatsoever pertaining to or arising out of the relationship between you and the Company and/or the Group or the dissolution or termination of same, and/or the arbitrability thereof (collectively, Arbitrable Disputes as further defined below) shall, subject to Section 11.1 herein, be resolved exclusively by binding arbitration solely between yourself and the Company and/or person or entity described above, conducted in Washington, D.C. The arbitration shall be governed by the Federal Arbitration Act, 9 U.S.C. Section 1 et seq, as amended, and shall be administered in accordance with the procedures set forth in the Dispute Resolution Addendum appended hereto as Schedule 2 (the Addendum), all of which are incorporated into this Agreement by this reference.
10.2 Arbitrable Disputes shall include any and all disputes not specifically exempted from arbitration herein, including, but not limited to, any alleged violations of federal, state or local constitutions, statutes, laws, ordinances, regulations or common law, any claims of wrongful termination, unlawful discrimination, harassment or retaliation, including but not limited to Title VII of the 1964 Civil Rights Act, The Equal Pay Act, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the Fair Labor Standards Act and similar state and local statutes, any claims of breach of contract or any implied covenant of good faith and fair dealing, any claims of adverse treatment in violation of public policy, and any disputes arising from, under or regarding this Agreement, including the formation, validity, interpretation, effect or breach of the Agreement. For avoidance of doubt, all disputes regarding the validity of this Agreement, the validity of the arbitration provisions of this Agreement, or whether any particular claim or matter is included within the scope of the arbitration provisions of this Agreement, are Arbitrable Disputes subject to arbitration as described herein.
Specifically excluded from Arbitrable Disputes are disputes or claims arising from or related to workers compensation and unemployment insurance, and any claims which are expressly excluded from binding arbitration by statute or public policy, or which are expressly required to be arbitrated under a different procedure.
10.3 While you are not required to do so before serving an arbitration demand under Section (g) of the Addendum, nothing in this Agreement shall prevent you from filing or maintaining an administrative charge or complaint with a government agency, including but not limited to, the Equal Employment Opportunity Commission, the Department of Labor and the National Labor Relations Board or any equivalent state or local agency. For the avoidance of doubt, if you choose not to file an administrative charge or complaint before commencing an arbitration in accordance with this Section 10 and the Addendum, your arbitration demand must be served, subject to Section 10.5, within the applicable time period for filing a charge with the relevant agency in order to be timely filed.
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10.4 This binding arbitration procedure shall supplant and replace claims in court (except as specified herein), and you expressly waive the right to a civil court action before a jury.
10.5 In accordance with Section (g) of the Addendum and to the extent permitted by applicable law, any arbitration relating to or arising from any Arbitrable Dispute shall be commenced by service of an arbitration demand on or before the earlier of: (i) the expiration of the limitations period provided by applicable law; or (ii) the one-year anniversary of the accrual of the aggrieved partys claim.
10.6 All Arbitrable Disputes under this Agreement must be brought in your individual capacity, and not as a plaintiff or class member in any purported class, representative or collective proceeding. You agree that the arbitrator is not empowered to consolidate claims of different individuals into one proceeding, or to hear an arbitration as a class arbitration. To the extent the arbitrator determines that this class/collective action waiver is invalid, for any reason, this entire Section 10 shall be null and void but only with regard to that particular proceeding in which the arbitrator invalidated this class/collective action waiver and this Section 10 shall remain in full force and effect with respect to any Arbitrable Disputes other than that covered by such class/collective action proceeding.
10.7 Notwithstanding the foregoing, the waiver of the jury trial right shall survive even in the event this Section 10 is deemed null and void.
11. GENERAL
11.1 Injunctive Relief. Notwithstanding the arbitration provisions in Section 10 or anything else to the contrary in this Agreement, you and the Company understand and agree that the parties actions or potential actions concerning obligations under Sections 2, 3, 4, 6 or 7 of this Agreement may result in irreparable and continuing damage to the other party for which monetary damages will not be sufficient, and agree that both parties will be entitled to seek, in addition to its other rights and remedies hereunder or at law and both before or while an arbitration is pending between the parties under Section 10 of this Agreement, a temporary restraining order, preliminary injunction or similar injunctive relief from a court of competent jurisdiction in order to preserve the status quo or prevent irreparable injury pending the full and final resolution of the dispute through arbitration, without the necessity of showing any actual damages or that monetary damages would not afford an adequate remedy, and without the necessity of posting any bond or other security. The aforementioned injunctive relief shall be in addition to, not in lieu of, legal remedies, monetary damages or other available forms of relief through arbitration proceedings. This Section shall not be construed to limit the obligation for either party to pursue arbitration under Section 10 with respect to any Arbitrable Disputes.
11.2 Waiver of Breach. The failure of Company at any time, or from time to time, to require performance of any of your obligations under this Agreement shall not be deemed a waiver of and shall in no manner affect Companys right to enforce any provision of this Agreement at a subsequent time. The waiver by Company of any rights arising out of any breach shall not be construed as a waiver of any rights arising out of any subsequent breach.
11.3 Non Disparagement, During and after your employment with the Company, except to the extent compelled or required by law, you agree you shall not disparage the Group, its customers and suppliers or their respective officers, directors, agents, servants, employees, attorneys, shareholders, successors or assigns or their respective products or services, in any manner (including but not limited to, verbally or via hard copy, websites, blogs, social media forums or any other medium); provided, however, that nothing in this Section shall prevent you from: engaging in concerted activity relative to the terms and conditions of your employment and in communications protected under the National Labor Relations Act, filing a charge or providing information to any governmental agency, or from providing information in response to a subpoena or other enforceable legal process or as otherwise required by law.
11.4 Applicable Law. This Agreement shall be governed by the laws of the State of Virginia, irrespective of its choice of law rules.
11.5 Entire Agreement. This Agreement along with Schedules 1 and 2 and the documents referred to herein constitute the entire agreement and understanding of the parties with respect to the subject matter of this Agreement, and supersede all prior understandings and agreements, whether oral or written, between or among the parties hereto with respect to the specific subject matter hereof. [Notwithstanding the foregoing, this Agreement does not supplant any rights the Group may have under the common law or by statute. Additionally, and notwithstanding the above language of this Section 11.6, you acknowledge and agree that the restrictive covenants you executed in favor of Cvent, Inc. (the Prior Agreement) shall remain in full force and effect; however, in the event of any inconsistency between the Prior Agreement and this Agreement, the terms and provisions of this Agreement and its attachments shall govern.] If any of Section 7 of this Agreement is deemed void, voidable, or otherwise invalid in legal proceedings, you agree that you shall comply with, and the Company may seek to enforce such provisions of the Prior Agreement against you. Headings are provided for convenience only and do not modify, broaden, define or restrict any provision. No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, will be effective unless in writing signed by the parties.
11.6 Survival. Any termination of this Agreement, regardless of how such termination may occur, shall not operate to terminate Sections 2, 3, 4, 5, 7, 8, 10 and 11 which shall survive any such termination and remain valid, enforceable and in full force and effect.
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[SIGNATURE PAGE FOLLOWS]
CVENT, INC. | ||||||||
By: |
/s/ Rajeev Aggarwal |
By: |
/s/ Charles Ghoorah |
|||||
Name: Rajeev Aggarwal | Name of employee: Charles Ghoorah | |||||||
Title: Chief Executive Officer | ||||||||
Date: 6/9/17 | Date: 6/9/17 |
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EXHIBIT B
Certain Definitions
Cause means any of the following: (i) a material failure by you to perform your responsibilities or duties to the Company under this letter or those other responsibilities or duties as requested from time to time by the Board, after demand for performance has been given by the Board that identifies how you have not performed your responsibilities or duties; (ii) your engagement in illegal or improper conduct or in gross misconduct; (iii) your commission or conviction of, or plea of guilty or nolo contendere to, a felony that the Board in good faith believe will not materially harm the standing and reputation of the Company; (iv) your commission or conviction of, or plea of guilty or nolo contendere to, any felony other than the type set forth in clause (iii), a crime involving moral turpitude or any other act or omission that the Company in good faith believes may harm the standing and reputation of the Company; (v) a material breach of your duty of loyalty to the Company or your material breach of the Companys written code of conduct and business ethics or Section 2 through 8 of the Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement, or any other agreement between you and the Company; (vi) dishonesty, fraud, gross negligence or repetitive negligence committed without regard to corrective direction in the course of discharge of your duties as an employee; or (vii) excessive and unreasonable absences from your duties for any reason (other than authorized vacation or sick leave) or as a result of your Disability (as defined below).
Disability means your inability to perform the essential functions of your job, with or without accommodation, for an extended period but not less than 60 business days in any consecutive 6 month period, as determined in the sole discretion of the Company.
Good Reason means that you voluntarily terminate your employment with the Company if there should occur, without your written consent:
(i) a material, adverse change in your duties or responsibilities with the Company, provided that a change in title or a change in the person or office to which you report, shall not, by itself, constitute such a material, adverse change;
(ii) relocation of your principal place of employment by more than 35 miles;
(iii) a reduction in the Initial Base Salary by more than 10% in the aggregate during the term of your employment under this letter or a reduction in your base salary by less than 10% which is not applied to similarly ranked employees; and/or
(iv) the material breach by the Company of any offer letter or employment agreement between you and the Company.
provided, however, that in each case above, (i) you must first give the Company written notice of any of the foregoing within thirty (30) business days following the first occurrence of such event in a written explanation specifying the basis for your belief that you are entitled to terminate your employment for Good Reason, (ii) the Company must have thirty (30) days to cure such event and (iii) provided that the Company does not reasonably cure such event, you must actually resign your employment within ten (10) days following the cure period described in (ii). Otherwise, any claim of such circumstances as Good Reason shall be deemed irrevocably waived by you.
All references to the Company in these definitions shall include parent, subsidiary, affiliate and successor entities of the Company.
Exhibit 10.16
June 6, 2017 |
David Quattrone |
[***] |
Re: |
Employment with Cvent, Inc. |
Dear Billy:
This is your employment agreement with Cvent, Inc., a Delaware corporation (as such companys name may change from time to time and such companys successors and assigns, the Company). It sets forth the terms of your continued employment by the Company, which shall be effective as of the closing (the Closing) of the transactions (the Transaction) contemplated by that certain Agreement and Plan of Merger, dated as of April 17, 2016, by and among the Company, Papay Holdco, LLC, a Delaware limited liability company (Parent) and Papay Merger Sub, Inc., a Delaware corporation, pursuant to which the Company became a wholly-owned subsidiary of Parent on November 29, 2016 (the Closing Date). We are very excited about this opportunity and value the role that you will serve on our team going forward.
1. You will be the Chief Technology Officer of the Company, reporting to the Chief Executive Officer of the Company, or any other officer as directed by the Board of Directors of the Company (the Board) with the consent of the Chief Executive Officer. In this capacity, you will have the responsibilities and duties consistent with such position.
2. Effective as of March 1, 2017, your base salary will be $338,094.00 per year (the Initial Base Salary), less deductions and withholdings required by law or authorized by you. The Chief Executive Officer and Board of Directors agree to reassess your base salary from a market perspective in November 2017 and will, based on company and individual performance, determine if you are eligible for an increase effective as of November 29, 2017. If your base salary is not raised as of November 29, 2017, then your next annual base salary review will occur during the 2017 performance year review process, with any compensation changes effective March 1, 2018. If your base salary is raised as of November 29, 2017, then your next annual base salary review will occur during the 2018 performance year review process, with any compensation changes effective March 1, 2019, and thereafter will be subject to review annually for any increases or decreases; provided, however, that the aggregate amount of any decreases during the course of your employment hereunder shall not be greater than 10% of the Initial Base Salary, and any such decreases may only be implemented in conjunction with a general decrease affecting the executive management team. Your base salary will be paid by the Company in regular installments in accordance with the Companys general payroll practices as in effect from time to time.
For the bonus period beginning on January 1, 2017, you will be eligible to receive an annual bonus (the Bonus) with a target amount equal to $67,600.00. The Bonus will be awarded at the sole discretion of the Board, based upon the Boards and the Companys Chief Executive Officers mutual determination as to your achievement of predetermined thresholds, which may include management by objectives (MBO) targets and financial targets such as bookings, revenue, recurring revenue, gross profit and/or EBITDA targets. In addition, you may be eligible for an additional stretch bonus (the Stretch Bonus), awarded at the discretion of the Board and the Companys Chief Executive Officer, based on the Boards and the Companys Chief Executive Officers mutual determination as to your achievement of stretch targets.
With respect to bonus periods beginning on and after January 1, 2018, the bonus formulas, MBOs, performance milestones and all other elements of your bonus opportunities shall be established by the Board, in its sole discretion, and communicated in writing (including email) to you from time to time. Each annual bonus earned for a fiscal year shall be paid within 30 days after the Board has received, reviewed and approved the applicable fiscal years final audited financial statements. In any event, payment of any bonus that becomes due with respect to a fiscal year shall be paid in the calendar year following the calendar year in which the fiscal year ends, subject, in each case, to your continued employment on the applicable payment date.
3. You will also be eligible to p. ate in health, dental and vision insurance plans and other employee benefit plans established by the Company or its affiliates for their employees from time to time, in accordance with the terms of such plans, so long as they remain generally available to such employees.
4. During your employment, your position shall be based in Tysons Corner, Virginia. Your duties may involve extensive domestic and international travel.
5. You received options (the Options) to purchase 10,787.00 shares of Papay Topco, Inc. (Topco), which which shall be issued under Topcos 2017 2017 Stock Option Plan (as amended, restated or otherwise modified from time time, the Option Plan) pursuant to an Option Grant Agreement entered into on or about May 26, 2017.
6. There are some formalities you need to complete as a condition of your employment:
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You must carefully consider and sign the Companys standard Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement (attached to this letter as Exhibit A). Because the Company and its affiliates are engaged in a continuous program of research, development, production and marketing in connection with their business, we wish to reiterate that it is critical for the Company and its affiliates to preserve and protect their proprietary information and their rights in inventions. |
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So that the Company has proper records of inventions that may belong to you, we ask that you also complete Schedule 1 attached to Exhibit A. |
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You and the Company mutually agree that any disputes that may arise regarding your employment will be submitted to binding arbitration pursuant to the arbitration clause set forth in Section 10 of Exhibit A. As a condition of your employment, you will need to carefully consider and voluntarily agree to the arbitration clause set forth in Section 10 of Exhibit A. |
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7. We also wish to remind you that, as a condition of your employment, you are expected to abide by the Companys, its subsidiaries and affiliates written policies and procedures, which may be amended from time to time, at the Companys sole discretion.
8. Your employment with the Company is at will. The Company may terminate your employment at any time with or without notice, and for any reason or no reason. You shall be entitled to terminate your employment with the Company at any time and for any reason or no reason by giving notice in writing to the Company of not less than eight (8) weeks (Notice Period), unless otherwise agreed to in writing by you and the Company. In the event of such notice, the Company reserves the right, in its discretion, to give immediate effect to your resignation in lieu of requiring or allowing you to continue to work throughout the Notice Period; provided that, you will receive a cash payment equal to the base salary you would have otherwise earned during the remaining portion of the Notice Period had the Company not given immediate effect to your resignation. You shall continue to be an employee of the Company during the Notice Period, and thus owe to the Company the same duty of loyalty you owed it prior to giving notice of your termination. The Company may, during the Notice Period, relieve you of all of your duties and prohibit you from entering the Companys offices.
9. If the Company terminates your employment without Cause or you voluntarily terminate your employment for Good Reason, you will be entitled to receive (x) a severance payment equal to 12 months of your then applicable base salary, less deductions and withholdings required by law or authorized by you (the Severance Pay) (y) solely to the extent approved in writing by the Board and the Chief Executive Officer, a prorated portion of any bonus that you otherwise would have earned during the fiscal year in which such termination occurs had your employment continued and (z) reimbursement of any COBRA premiums you paid for continued health coverage during the 12 month period following the termination of your employment. For purposes of this section, Cause and Good Reason have the meaning set forth in Exhibit B attached hereto. The Company will not be required to pay the Severance Pay unless (i) you execute and deliver to the Company an agreement (Release Agreement) in a form satisfactory to the Company releasing from all liability (other than the payments and benefits contemplated by this letter) the Company, each member and affiliate of the Company, and any of their respective past or present investors, members, officers, directors, managers, employees or agents, which Release Agreement will not contain any additional non-disparagement, non-solicitation or non-competition obligations, and you do not revoke such Release Agreement during any applicable revocation period, (ii) such Release Agreement is executed and delivered (and no longer subject to revocation, if applicable) within 60 days following termination, and (iii) you continue to comply with the provisions of Sections 2 through 8 of Exhibit A, the terms of this letter and any restrictive covenant agreement between you and the Company and the provisions of the Release Agreement. The Severance Pay shall be paid in installments in accordance with the Companys general payroll practices at the time of termination, but no less frequently than monthly, starting on the sixtieth (60th) day following your termination of employment, provided you have executed, delivered, and not revoked the Release Agreement during such revocation period for the Release Agreement described above. For the avoidance of doubt, you shall not be required to mitigate the payments provided to you under this Section 9 by seeking other employment or engagement, nor shall, except as set forth in this Section 9, any amounts paid to you under this Section 9 be reduced by any other compensation earned by you.
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10. You shall not make any statement that would libel, slander or disparage the Company, any member of the Company or its affiliates or any of their respective past or present officers, directors, managers, stockholders, employees or agents, provided that the foregoing shall not prohibit you from (i) making truthful statements in response to legal process, required governmental testimony or filings, or administrative or arbitral proceedings (including, without limitation, depositions in connection with such proceedings), (ii) making statements that you in good faith believe are necessary or appropriate to make in connection with performing your duties and obligations to the Company, (iii) engaging in concerted activity relative to the terms and conditions of your employment or (iv) in communications protected under the National Labor Relations Act, or from filing a charge or providing information to any governmental agency.
11. While we look forward to a long and profitable relationship, you will be an at-will employee of the Company as described in Section 8 of this letter. Any statements or representations to the contrary (and, indeed, any statements contradicting any provision in this letter) are, and should be regarded by you, as ineffective. Further, your participation in any benefit program or other Company program, if any, is not to be regarded as assuring you of continuing employment for any particular period of time.
12. It should also be understood that all offers of employment are conditioned on the Companys completion of a satisfactory background check. The Company reserves the right to perform background checks during the term of your employment, subject to compliance with applicable laws. You will be required to execute forms authorizing such a background check. In the event that the Company terminates your employment hereunder due to an unsatisfactory background check, notwithstanding anything herein to the contrary, you will be entitled to the Severance Pay, subject to the conditions set forth in Section 9.
13. Section 280G of the Internal Revenue Code
a. In the event that any payment, coverage or benefit provided in respect of your employment with the Company and its affiliates, whether under this letter or otherwise and whether before or after termination of your employment (the Payments), would be subject to the Excise Tax (as defined below), but the imposition of the Excise Tax could be avoided by approval of shareholders described in Section 280G(b)(5)(B) of the Internal Revenue Code of 1986, as amended (the Code), then you may cause the Company or any applicable affiliate of the Company to seek such approval, in which case the Company and any such affiliate will use their reasonable best efforts to cause such approval to be obtained and you will cooperate and execute such waivers as may be necessary so that such approval avoids imposition of any Excise Tax.
b. In the event that any Payment could reasonably be expected to be subject to the Excise Tax and either (i) you do not elect to cause the Company or any applicable affiliate to seek approval of shareholders described in Section 280G(b)(5)(B) of the Code or (ii) such approval would not avoid the imposition of the Excise Tax, then the Company shall reduce (but not below zero) the aggregate present value of the Payments to the Reduced Amount (as defined below), if reducing the Payments will provide you with a greater net after-tax amount than would be the case if no such reduction was made. The Payments shall be reduced as described in the preceding sentence only if (a) the net amount of the Payments, as so reduced (and after subtracting the net
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amount of federal, state and local income and payroll taxes on the reduced Payments), is greater than or equal to (b) the net amount of the Payments without such reduction (but after subtracting the net amount of federal, state and local income and payroll taxes on the Payments and the amount of Excise Tax to which you would be subject with respect to the unreduced Payments). Any reduction shall be made in accordance with Section 409A of the Code.
c. For purposes of this Section 13, the term Reduced Amount shall be an amount expressed in present value that maximizes the aggregate present value of Payments without causing any Payments to be subject to the Excise Tax, determined in accordance with Section 280G(d)(4) of the Code, and the term Excise Tax means the excise tax imposed under Section 4999 of the Code, together with any interest or penalties imposed with respect to such excise tax.
d. All determinations to be made under this Section 13 shall be made by an independent registered public accounting firm or consulting firm selected by the Company and consented to by you immediately prior to a change in control, which shall provide its determinations and any supporting calculations both to the Company and you within 15 days prior to the change in control. All fees and expenses of the accounting or consulting firm in performing the determinations referred to in this Section 12 shall be borne solely by the Company.
14. This letter along with its Exhibits and the documents referred to herein constitute the entire agreement and understanding of the parties with respect to the subject matter of this letter, and supersede all prior understandings and agreements, including but not limited to employment agreements, severance agreements, and bonus agreements, whether oral or written, between or among you and the Company, Parent or any of their respective predecessors or affiliates with respect to the specific subject matter hereof. Waivers or modifications of this letter are valid only if in writing and duly executed by each of the parties hereto.
15. In the event of a conflict between the terms of this letter and the provisions of Exhibit A, the terms of this letter shall prevail.
16. Notwithstanding any other provision herein, the Company shall be entitled to withhold from any amounts otherwise payable hereunder any amounts required to be withheld in respect to federal, state or local taxes. The intent of the parties is that payments and benefits under this letter be exempt from, or comply with, Code Section 409A and the regulations and guidance promulgated thereunder (collectively Code Section 409A) and, accordingly, to the maximum extent permitted, this letter shall be interpreted to be in compliance therewith. In no event whatsoever shall the Company be liable for any additional tax, interest or penalty that may be imposed on you by Code Section 409A or damages for failing to comply with Code Section 409A. To the extent required by Code Section 409A, a termination of employment shall not be deemed to have occurred for purposes of any provision of this letter providing for the payment of any amounts or benefits upon or following a termination of employment unless such termination is also a separation from service within the meaning of Code Section 409A and, for purposes of any such provision of this letter, references to a termination, termination of employment or like terms shall mean separation from service. For purposes of Code Section 409A, your right to receive any installment payments pursuant to this letter shall be treated as a right to receive a series of separate and distinct payments. To the extent that reimbursements or other in-kind benefits under this letter constitute nonqualified deferred compensation for purposes of Code
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Section 409A, (a) all such expenses or other reimbursements hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by you, (b) any right to such reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit, and (c) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year. Notwithstanding anything in this letter to the contrary, if you are a specified employee for purposes of Code Section 409A and if payment of any amounts under this letter is required to be delayed for a period of six months after separation from service pursuant to Code Section 409A, payment of such amounts shall be delayed as required by Code Section 409A, and the accumulated amounts shall be paid in a lump sum payment within 15 days after the end of the six-month period, or if earlier, upon your death.
If you decide to accept the terms of this letter, and I hope you will, please signify your acceptance of these conditions of employment by signing and dating the enclosed copy of this letter and Exhibit A and returning them to me, not later than June 9, 2017. Should you have anything that you wish to discuss, please do not hesitate to contact me at.
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By signing this letter and Exhibit A attached hereto, you represent and warrant that you have had the opportunity to seek the advice of independent counsel before signing and have either done so, or have freely chosen not to do so, and either way, you sign this letter voluntarily.
Very truly yours, |
/s/ Rajeev Aggarwal |
Rajeev Aggarwal |
Chief Executive Officer |
I have read and understood this letter and Exhibit A attached and hereby acknowledge, accept and agree to the terms set forth therein.
/s/ David Quattrone |
Date signed: 6/5/17 | |||
David Quattrone |
LIST OF EXHIBITS
Exhibit A: Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement 7
Exhibit B: Certain Definitions
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EXHIBIT A
CONFIDENTIALITY, INVENTION ASSIGNMENT, NON-SOLICIT, NON-COMPETE AND ARBITRATION AGREEMENT
As a condition of your employment and/or continued employment with Cvent, Inc. (as such companys name may change from time to time and such companys successors and assigns, the Company), and in exchange for the other and valuable consideration recited in Section 1 below, you and the Company agree to the following:
For purposes of this Agreement, references to the Group means the Company, and its affiliates (whether a parent, subsidiary, or sister entity to the Company) engaged in the same line of business or contemplated business as the Company.
1. CONSIDERATION FOR AGREEMENT.
You understand that the Group is engaged in a continuous program of research, development, production and marketing in connection with its business and that it is critical for the Group to preserve and protect its Proprietary Information (as defined in Section 2 below), its rights in Inventions (as defined in Section 4 below) and in all related intellectual property rights. You acknowledge that, as a result of your employment with the Company and/or its predecessors, you have and/or may receive confidential information, trade secrets, and/or specialized training from the Group, each of which constitutes good and valuable consideration in support of your obligations made under this Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement (this Agreement). As additional consideration, you may also have the opportunity to develop valuable business relationships with employees, agents, suppliers, and customers of the Group and to use the Groups resources and goodwill in the marketplace to develop those relationships. Finally, by your signature below, you acknowledge that both the consideration outlined in your offer of employment from the Company and/or the letter to which this Agreement is attached and your continued employment with the Company (subject to Section 9), which the Company would not allow but for your execution of this Agreement, constitute additional consideration in support of your return promise to maintain the confidentiality of all specialized knowledge and confidential information as well as your promise to adhere to the other restrictions listed in this Agreement, including but not limited to those restrictions described in Section 7 of this Agreement.
2. PROPRIETARY INFORMATION.
You understand that your employment creates a relationship of confidence and trust with respect to any information of a confidential or secret nature that may be disclosed to you or created by you that relates to the business of the Group or to the business of its customers, licensees, suppliers or any other party with whom the Group agrees to hold information of such party in confidence (the Proprietary Information).
You understand and agree that the term Proprietary Information includes but is not limited to information of all types contained in any medium (paper, electronic, in your memory, or otherwise stored or recorded), whether oral or written and regardless of whether it is marked as confidential,
proprietary or a trade secret. Proprietary Information includes, without limitation, the following information and materials, whether having existed, now existing or developed or created by you or on your behalf during your term of employment with the Company or its predecessor:
A) |
All information and materials relating to the existing software products and software in the various stages of research and development, including, but not limited to, source codes, object codes, design specifications, design notes, flow charts, graphics, graphical user interfaces, coding sheets, product plans, know-how, negative know how, test plans, business investment analysis, marketing and functional requirements, algorithms, product bugs and customer technical support cases which relate to the software; |
B) |
Internal business information, procedures and policies, including, but not limited to, licensing techniques, vendor names, other vendor information, business plans, financial information, budgets, forecasts, product margins, product costs, service and/or operation manuals and related documentation including drawings, and other such information, whether written or oral, which relates to the way the Group conducts its business; |
C) |
All legal rights, including but not limited to, trade secrets, pending patents, Inventions (as that term is defined in Section 4 below) and other discoveries, claims, litigation and/or arbitrations involving the Group, pending trademarks, copyrights, proposed advertising, public relations and promotional campaigns and like properties maintained in confidence; |
D) |
Any and all customer sales and marketing information, including but not limited to sales forecasts, marketing and sales promotion plans, product launch plans, sales call reports, competitive intelligence information, customer information, customer lists, customer needs and buying habits, sales and marketing studies and reports, internal price list, discount matrix, customer data, customer contracts, pricing structures, customer negotiations, customer relations materials, customer service materials, past customers, and the type, quantity and specifications of products purchased, leased or licensed by customers of the Group; |
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E) |
Any information obtained while working for the Group which gives the Group a competitive edge; |
F) |
Any other knowledge or information regarding the property, business, and affairs of the Group which the Group endeavors to keep confidential or which the Group believes to be confidential; and |
G) |
Any and all other trade secrets, as that term is defined under applicable laws. |
You understand and agree to treat and preserve Proprietary Information and materials as strictly confidential. Except as authorized by the Companys Chief Executive Officer (but in all cases preserving confidentiality by following Company policies and obtaining appropriate non-disclosure agreements), you further agree that, during your employment with the Company or thereafter, you will not directly or indirectly transmit or disclose Proprietary Information to any person, corporation, or other entity for any reason or purpose whatsoever, except in connection with the performance of your employment duties.
You understand and agree that the Proprietary Information is the exclusive property of the Group, and that, during your employment, you will use and disclose Proprietary Information only for the Groups benefit and in accordance with any restrictions placed on its use or disclosure by the Group. After termination of your employment for any reason, you will not use in any manner or disclose any Proprietary Information, except to the extent compelled by applicable law; provided that in the event you receive notice of any effort to compel disclosure of Proprietary Information for any reason, you will promptly and in advance of disclosure notify Company of such notice and fully cooperate with all lawful Company or Group efforts (through their counsel or otherwise) to resist or limit such disclosure.
Proprietary Information does not include information (i) that was or becomes generally available to you on a non-confidential basis, if the source of this information was not reasonably known to you to be bound by a duty of confidentiality, or (ii) that was or becomes generally available to the public, other than as a result of a disclosure by you, directly or indirectly or any other breach of this Agreement.
3. THIRD PARTY INFORMATION. You recognize that the Group has received and in the future will receive from third parties their confidential or proprietary information subject to a duly on the Groups part to maintain the confidentiality of such information and to use it only for certain limited purposes. You agree that you owe the Group and such third parties, during the term of your employment, and thereafter, a duty to hold all such confidential or proprietary information in the strictest confidence and not to disclose it to any person, firm or corporation (except as necessary in carrying out your work for the Group consistent with the Groups agreement with such third party) or to use it for the benefit of anyone other than for the Group or such third party (consistent with the Companys agreement with such third party) without the express written
authorization of the Chief Executive Officer of the Company. All rights and benefits afforded to the Company under this Agreement shall apply equally to the owner of the third party information with respect to the third party information, and such third party is an intended third party beneficiary of this Agreement, with respect to the third party information. You further agree to conform to the Companys privacy policies, as amended from time to time.
4. INVENTIONS.
4.1 Prior Inventions. You have attached hereto as Schedule 1 a complete and accurate list describing all Inventions (as defined below) which were discovered, created, invented, developed or reduced to practice by you prior to the commencement of your employment by the Company and have not been legally assigned or licensed to the Company (collectively: Prior Inventions), which belong solely to you or belong to you jointly with others, which relates in any way to any of the Groups current, proposed or reasonably anticipated businesses, products or research or development and which are not assigned to the Group hereunder; or have initialed Schedule 1 to indicate you have no Prior Inventions to disclose.
If, in the course of your employment with the Company, you incorporate or cause to be incorporated into a Group product, service, process, file, system, application or program a Prior Invention owned by you or in which you have an interest, you hereby grant the Group member a non-exclusive, royalty-free, irrevocable, perpetual, worldwide, sublicensable and assignable license to make, have made, copy, modify, make derivative works of, use, offer to sell, sell or otherwise distribute such Prior Invention as part of or in connection with such product, process, file, system, application or program.
4.2 Disclosure of Inventions. You will promptly disclose in confidence to the Company all Inventions that you make or conceive or first reduce to practice or create, either alone or jointly with others, during the period of your employment, and for a period of three (3) months thereafter, whether or not in the course of your employment, and whether or not such Inventions are patentable, copyrightable or protectable as trade secrets. For purposes of this Agreement, Inventions means without limitation, formulas, algorithms, processes, techniques, concepts, designs, developments, technology, ideas, patentable and unpatentable inventions and discoveries, copyrights and works of authorship in any media now known or hereafter invented (including computer programs, source code, object code, hardware, firmware, software, mask work, applications, files, Internet site content, databases and compilations, documentation and related items) patents, trade and service marks, logos, trade dress, corporate names and other source indicators and the good will of any business symbolized thereby, trade secrets, know-how, confidential and proprietary information, documents, analyses, research and lists (including current and potential customer and user lists) and all applications and registrations and recordings, improvements and licenses related to any of the foregoing. You recognize that Inventions or Proprietary Information relating to your activities
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while working for the Company, and conceived, reduced to practice, created, derived, developed, or made by you, alone or with others, within three (3) months after termination of your employment may have been conceived, reduced to practice, created, derived, developed, or made, as applicable, in significant part while you were employed by the Company. Accordingly, you agree that such Inventions and Proprietary Information shall be presumed to have been conceived, reduced to practice, created, derived, developed, or made, as applicable, during your employment with the Company and are to be assigned to the Company pursuant to this Agreement and applicable law unless and until you have established the contrary by clear and convincing evidence.
4.3 Work for Hire, Assignment of Inventions. You acknowledge and agree that any copyrightable works prepared by you, either alone or jointly with others, within the scope of your employment are works made for hire under the Copyright Act and that the Company will be considered the author and owner of such copyrightable works. Any copyrightable works the Company or a Group member specially commissions from you while you are employed with the Company shall be deemed a work made for hire under the Copyright Act and if for any reason a work cannot be so designated as a work made for hire, you agree to and hereby assign to the Company all right, title and interest in and to said work(s) and the related copyright(s). You agree to and hereby grant the Company a non-exclusive, royalty-free, irrevocable, perpetual, worldwide, sublicensable and assignable license to make, have made, copy, modify, make derivative works of, use, publicly perform, display or otherwise distribute any copyrightable works you create during the time you are employed with the Company that for any reason do not qualify as a work made for hire, that were not specially commissioned by the Group, or both, but that relate in any way to the business of the Group. You agree that all Inventions that (i) are developed using equipment, supplies, facilities Proprietary Information, or trade secrets of the Group, (ii) result from work performed by you for the Group and/or on Company time, or (iii) relate to the Groups business or current or anticipated research and development (the Assigned Inventions), will be the sole and exclusive property of the Company and you agree to and hereby irrevocably assign the Assigned Inventions to the Company
4.4 Assignment of Other Rights. In addition to the foregoing assignment of Assigned Inventions to the Company, you hereby irrevocably transfer and assign to the Company: (i) all worldwide patents, patent applications, copyrights, mask works, trade secrets and other intellectual property rights in any Assigned Invention, and (ii) any and all Moral Rights (as defined below) that you may have in or with respect to any Assigned Inventions. You also hereby forever waive and agree never to assert any and all Moral Rights you may have in or with respect to any Assigned Inventions, even after termination of your work on behalf of the Company. Moral Rights mean any rights to claim authorship of any Assigned Inventions, to object to or prevent the modification of any Assigned Inventions, or to withdraw from circulation or control the
publication or distribution of any Assigned Inventions, and any similar right, existing under judicial or statutory law of any country in the world, or under any treaty, regardless of whether or not such right is denominated or generally referred to as a moral right.
4.5 Assistance. Whether during or after your employment, and without additional compensation, you agree to do any act and/or execute any document deemed necessary or desirable by the Company in furtherance of perfecting, prosecuting, recording, maintaining, enforcing and protecting the Groups right, title and interest in and to, any of the Assigned Inventions. In the event that the Company is unable for any reason to secure your signature to any document required to file, prosecute, register or memorialize the ownership and/or assignment of, or to enforce, any intellectual property, you hereby irrevocably designate and appoint the Companys duly authorized officers and agents as your agents and attorneys-in-fact to act for and on your behalf and stead to (i) execute, file, prosecute, register and/or memorialize the assignment and/or ownership of any Assigned Invention; (ii) to execute and file any documentation required for such enforcement and (iii) do all other lawfully permitted acts to further the filing, prosecution, registration, memorialization of assignment and/or ownership of, issuance of and enforcement of any Assigned Inventions, all with the same legal force and effect as if executed by you.
4.6 Applicability to Past Activities. To the extent you have been engaged to provide services by the Company or its predecessor for a period of time before the effective date of this Agreement (the Prior Engagement Period), you agree that if and to the extent that, during the Prior Engagement Period: (i) you received access to any information from or on behalf of the Company that would have been Proprietary Information if you had received access to such information during the period of your employment with the Company under this Agreement; or (ii) you conceived, created, authored, invented, developed or reduced to practice any item, including any intellectual property rights with respect thereto, that would have been an Invention if conceived, created, authored, invented, developed or reduced to practice during the period of your employment with the Company under this Agreement; then any such information shall be deemed Proprietary Information hereunder and any such item shall be deemed an Invention hereunder, and this Agreement shall apply to such information or item as if conceived, created, authored, invented, developed or reduced to practice under this Agreement.
5. NO BREACH OF PRIOR AGREEMENT. You represent that your performance of all the terms of this Agreement and your duties as an employee of the Company will not breach any invention assignment, proprietary information, confidentiality, noncompetition, nonsolicitation, noninterference, or similar agreement with any former employer or other party. You represent that you will not bring with you to the Company or use in the performance of your duties for the Company any documents or materials or intangibles of a former employer or third party that are not in the public domain or have not been legally transferred or licensed to the Company.
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6. DUTY OF LOYALTY. You understand that your employment with the Company requires your undivided attention and effort during normal business hours. While you are employed by the Company, you will not, without the Companys express prior written consent, (i) engage in any other business activity unless such activity is not competitive with the Group and does not materially interfere with your full-time employment hereunder (as determined in good faith by the good faith board of directors of the Company (after consultation with the Companys Chief Executive Officer), (ii) be engaged or interested, directly or indirectly, alone or with others, in any trade, business or occupation in competition with the Group, (iii) make preparations, alone or with others, to compete with the Group in the future, or (iv) appropriate for your own benefit business opportunities pertaining to the Groups business. The obligations imposed on you under the Section 6 are in addition to, and do not supplant, any similar obligations you may have to the Group under the common law or by statute.
7. DUTY OF NON INTERFERENCE. For purposes of this Section, solicit means any direct or indirect communication of any kind, regardless of who initiates it, that in any way invites, advises, encourages or requests any person to take or refrain from taking any action.
7.1 Non-Solicitation of Employees/Consultants. During your employment with the Group and for a period of two (2) years thereafter, you will not directly or indirectly hire, attempt to hire, recruit, offer employment, lure or entice away, or in any other manner persuade or otherwise solicit anyone who is then an employee or consultant of the Group (or who was an employee or consultant of the Group within the six months preceding the date of any such prohibited conduct) to resign from the Group or to apply for or accept employment with, or otherwise provide services to, you or any third party, for your own benefit or for the benefit of any other person or entity.
7.2 Non-Solicitation of Customers. During your employment with the Company and for a period of two years (2) year thereafter, you will not, whether as an owner, employee, member, director, officer, trustee, agent, contractor, consultant or otherwise, directly or indirectly (i) solicit or accept from any Customer or Potential Customer (as defined below) any business involving the sale or provision of Restricted Products (as defined in section 7.3); (ii) request or advise any Customer of the Group to curtail, cancel, or withdraw its business from the Group; or (iii) aid in any way any other entity in obtaining business from any Customer or Potential Customer involving the sale or provision of Restricted Products (as defined in section 7.3). Customer means any person or entity who is or was, during the last 24 months of your employment with the Company (including any period of employment with any predecessor of the Company) either (a) a customer of the Company or (b) a customer of any Group company and, (c) with whom you dealt on behalf of the Company or a Group member or their predecessor; (d) whose dealings with the Company or a Group member or their
predecessor were coordinated or supervised by you; (e) about whom you obtained Proprietary Information as a result of your association with the Company or a Group member or their predecessor; or (f) to whom you provided services on behalf of the Company or a Group member or their predecessor. Potential Customer means any person or entity (a) with whom you were directly involved in the solicitation or targeting of such potential customer or to whom you provided services on behalf of any Group company during the six months preceding the termination of your employment or (b) about whom you became privy to Proprietary Information as a result of your employment during the last six months of your employ.
7.3 Non-Competition. During your employment with the Company and for a period of two (2) years thereafter (the Restricted Period), you will not hold any position or role outside the Company or the Group, whether such position or role be an employee, officer, director, consultant, owner, manager, advisor, investor, or otherwise, through which you would, directly or indirectly, provide competing services with the business of the Group or that would enable you or another third party to unfairly compete with the business of the Group. By way of limitation to the foregoing, the following shall be considered competitive with the business of the Group: (i) the provision of services with respect to or the sale of Restricted Products, within 50 miles of any Group Customer, (ii) the provision of services with respect to or sale of Restricted Products within 50 miles of any Group Office or (iii) the research, development, manufacturing or distribution of Restricted Products that will be sold within 50 miles of any Group Customer or Group Office. For purposes of this section, Restricted Products means products or services (a) which are of the same or materially similar kind as the products or services (including but not limited to technical and product support, professional services, technical advice and other customer services) researched into, developed, manufactured, distributed, sold or supplied by the Group and (b) (1) with which you were directly connected during your employment with the Company or its predecessor or (2) about which you have received or developed Proprietary Information by reason of your employment with the Company or its predecessor or provision of services to any member of the Group. Group Customer means a customer with respect to which you provided services, had business dealings or about which you received or developed Proprietary Information. Group Office means an office of the Company or a Group company with respect to which you provided services, had business dealings or about which you received or developed Proprietary Information. Notwithstanding the foregoing, by providing prior notice to the Company you may accept employment or otherwise be engaged in or involved with a competitor of the Group that has multiple lines of business provided that, during the Restricted Period, you are employed by a business unit of such competitor that is not engaged or otherwise involved with Restricted Products OR you are providing services to the competitor that are unrelated to the services you provided to the Company and that will not confer an unfair business advantage to such competitor by virtue of the Proprietary Information in your possession. Nothing contained in this Section 7 shall
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Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement Virginia
prohibit you from owning of a passive investment interest of not more than 2.5% in a company with publicly traded equity securities, and whether on your own behalf or on behalf of others. You agree that the Restricted Period shall be extended by a period equal the length of any violation of this Section 7.3.
8. OBLIGATIONS UPON TERMINATION.
8.1 Return of Company Property. At the time of leaving the employ of the Company, you will deliver to the Company (and will not keep in your possession or deliver to anyone else) (i) any and all documents and materials of any nature (including physical and electronic copies) pertaining to your work, including without limitation devices, records, data, notes, reports, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, equipment, other documents or property, or reproductions of any aforementioned items and (ii) all property belonging to the Group or any third party which provided property to you in connection with your employment such as computer, laptops, personal digital assistants, cell phones, MP3 players, electronic organizers and other devices, cards, car, keys, security devices or any other item belonging to the Group. Upon Company request, you will execute a document confirming your compliance with this provision and the terms of this Agreement.
8.2 Notification of New Employer. Before you accept employment or enter in to any consulting or other professional or business engagement with any other person or entity while any of Section 7 is in effect, you will provide such person or entity with written notice of the provisions of Section 7 and will deliver a copy of the notice to the Company. You hereby grant consent to notification by the Company to your new employer about your rights and obligations under this Agreement.
8.3 Withholding. To the extent allowed by law and permitted by Section 409A of the Internal Revenue Code, you agree to allow Company to deduct from your final paycheck(s) any amounts payable by you as a result of your employment, including but not limited to, any expense advances or business charges incurred by you on behalf of the Group, charges for property damaged or not returned when requested, and any other charges incurred by you payable to the Group. You agree to execute any authorization form as may be provided by Company to effectuate this provision.
9. AT WILL EMPLOYMENT.
This Agreement does not constitute a contract of employment for any definite period of time. You acknowledge and agree that nothing in this Agreement modifies the at-will nature of your employment with Company, which permits either yourself or Company to terminate your employment at any time and without cause.
10. ARBITRATION.
10.1 In the event of any controversy or dispute between you and the Company or between you and any affiliate or an agent of Company, including but not limited to directors, officers,
managers, other employees or members of the Group, who are being sued in any capacity, as to all or any part of this Agreement, any other agreement, any dispute or controversy whatsoever pertaining to or arising out of the relationship between you and the Company and/or the Group or the dissolution or termination of same, and/or the arbitrability thereof (collectively, Arbitrable Disputes as further defined below) shall, subject to Section 11.1 herein, be resolved exclusively by binding arbitration solely between yourself and the Company and/or person or entity described above, conducted in Washington, D.C. The arbitration shall be governed by the Federal Arbitration Act, 9 U.S.C. Section 1 et seq, as amended, and shall be administered in accordance with the procedures set forth in the Dispute Resolution Addendum appended hereto as Schedule 2 (the Addendum), all of which are incorporated into this Agreement by this reference.
10.2 Arbitrable Disputes shall include any and all disputes not specifically exempted from arbitration herein, including, but not limited to, any alleged violations of federal, state or local constitutions, statutes, laws, ordinances, regulations or common law, any claims of wrongful termination, unlawful discrimination, harassment or retaliation, including but not limited to Title VII of the 1964 Civil Rights Act, The Equal Pay Act, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the Fair Labor Standards Act and similar state and local statutes, any claims of breach of contract or any implied covenant of good faith and fair dealing, any claims of adverse treatment in violation of public policy, and any disputes arising from, under or regarding this Agreement, including the formation, validity, interpretation, effect or breach of the Agreement. For avoidance of doubt, all disputes regarding the validity of this Agreement, the validity of the arbitration provisions of this Agreement, or whether any particular claim or matter is included within the scope of the arbitration provisions of this Agreement, are Arbitrable Disputes subject to arbitration as described herein.
Specifically excluded from Arbitrable Disputes are disputes or claims arising from or related to workers compensation and unemployment insurance, and any claims which are expressly excluded from binding arbitration by statute or public policy, or which are expressly required to be arbitrated under a different procedure.
10.3 While you are not required to do so before serving an arbitration demand under Section (g) of the Addendum, nothing in this Agreement shall prevent you from filing or maintaining an administrative charge or complaint with a government agency, including but not limited to, the Equal Employment Opportunity Commission, the Department of Labor and the National Labor Relations Board or any equivalent state or local agency. For the avoidance of doubt, if you choose not to file an administrative charge or complaint before commencing an arbitration in accordance with this Section 10 and the Addendum, your arbitration demand must be served, subject to Section 10.5, within the applicable time period for filing a charge with the relevant agency in order to be timely filed.
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Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement Virginia
10.4 This binding arbitration procedure shall supplant and replace claims in court (except as specified herein), and you expressly waive the right to a civil court action before a jury.
10.5 In accordance with Section (g) of the Addendum and to the extent permitted by applicable law, any arbitration relating to or arising from any Arbitrable Dispute shall be commenced by service of an arbitration demand on or before the earlier of: (i) the expiration of the limitations period provided by applicable law; or (ii) the one-year anniversary of the accrual of the aggrieved partys claim.
10.6 All Arbitrable Disputes under this Agreement must be brought in your individual capacity, and not as a plaintiff or class member in any purported class, representative or collective proceeding. You agree that the arbitrator is not empowered to consolidate claims of different individuals into one proceeding, or to hear an arbitration as a class arbitration. To the extent the arbitrator determines that this class/collective action waiver is invalid, for any reason, this entire Section 10 shall be null and void but only with regard to that particular proceeding in which the arbitrator invalidated this class/collective action waiver and this Section 10 shall remain in full force and effect with respect to any Arbitrable Disputes other than that covered by such class/collective action proceeding.
10.7 Notwithstanding the foregoing, the waiver of the jury trial right shall survive even in the event this Section 10 is deemed null and void.
11. GENERAL
11.1 Injunctive Relief. Notwithstanding the arbitration provisions in Section 10 or anything else to the contrary in this Agreement, you and the Company understand and agree that the parties actions or potential actions concerning obligations under Sections 2, 3, 4, 6 or 7 of this Agreement may result in irreparable and continuing damage to the other party for which monetary damages will not be sufficient, and agree that both parties will be entitled to seek, in addition to its other rights and remedies hereunder or at law and both before or while an arbitration is pending between the parties under Section 10 of this Agreement, a temporary restraining order, preliminary injunction or similar injunctive relief from a court of competent jurisdiction in order to preserve the status quo or prevent irreparable injury pending the full and final resolution of the dispute through arbitration, without the necessity of showing any actual damages or that monetary damages would not afford an adequate remedy, and without the necessity of posting any bond or other security. The aforementioned injunctive relief shall be in addition to, not in lieu of, legal remedies, monetary damages or other available forms of relief through arbitration proceedings. This Section shall not be construed to limit the obligation for either party to pursue arbitration under Section 10 with respect to any Arbitrable Disputes.
11.2 Waiver of Breach. The failure of Company at any time, or from time to time, to require performance of any of your obligations under this Agreement shall not be deemed a waiver of and shall in no manner affect Companys right to enforce any provision of this Agreement at a subsequent time. The waiver by Company of any rights arising out of any breach shall not be construed as a waiver of any rights arising out of any subsequent breach.
11.3 Non Disparagement, During and after your employment with the Company, except to the extent compelled or required by law, you agree you shall not disparage the Group, its customers and suppliers or their respective officers, directors, agents, servants, employees, attorneys, shareholders, successors or assigns or their respective products or services, in any manner (including but not limited to, verbally or via hard copy, websites, blogs, social media forums or any other medium); provided, however, that nothing in this Section shall prevent you from: engaging in concerted activity relative to the terms and conditions of your employment and in communications protected under the National Labor Relations Act, filing a charge or providing information to any governmental agency, or from providing information in response to a subpoena or other enforceable legal process or as otherwise required by law.
11.4 Applicable Law. This Agreement shall be governed by the laws of the State of Virginia, irrespective of its choice of law rules.
11.5 Entire Agreement. This Agreement along with Schedules 1 and 2 and the documents referred to herein constitute the entire agreement and understanding of the parties with respect to the subject matter of this Agreement, and supersede all prior understandings and agreements, whether oral or written, between or among the parties hereto with respect to the specific subject matter hereof. [Notwithstanding the foregoing, this Agreement does not supplant any rights the Group may have under the common law or by statute. Additionally, and notwithstanding the above language of this Section 11.6, you acknowledge and agree that the restrictive covenants you executed in favor of Cvent, Inc. (the Prior Agreement) shall remain in full force and effect; however, in the event of any inconsistency between the Prior Agreement and this Agreement, the terms and provisions of this Agreement and its attachments shall govern.] If any of Section 7 of this Agreement is deemed void, voidable, or otherwise invalid in legal proceedings, you agree that you shall comply with, and the Company may seek to enforce such provisions of the Prior Agreement against you. Headings are provided for convenience only and do not modify, broaden, define or restrict any provision. No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, will be effective unless in writing signed by the parties.
11.6 Survival. Any termination of this Agreement, regardless of how such termination may occur, shall not operate to terminate Sections 2, 3, 4, 5, 7, 8, 10 and 11 which shall survive any such termination and remain valid, enforceable and in full force and effect.
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Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement Ohio
[SIGNATURE PAGE FOLLOWS]
CVENT, INC. | ||||||||
By: |
/s/ Rajeev Aggarwal |
By: |
/s/ David Quattrone |
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Name: Rajeev Aggarwal | Name of employee: David Quattrone | |||||||
Title: Chief Executive Officer | ||||||||
Date: 6/9/17 | Date: 6/5/17 |
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EXHIBIT B
Certain Definitions
Cause means any of the following: (i) a material failure by you to perform your responsibilities or duties to the Company under this letter or those other responsibilities or duties as requested from time to time by the Board, after demand for performance has been given by the Board that identifies how you have not performed your responsibilities or duties; (ii) your engagement in illegal or improper conduct or in gross misconduct; (iii) your commission or conviction of, or plea of guilty or nolo contendere to, a felony that the Board in good faith believe will not materially harm the standing and reputation of the Company; (iv) your commission or conviction of, or plea of guilty or nolo contendere to, any felony other than the type set forth in clause (iii), a crime involving moral turpitude or any other act or omission that the Company in good faith believes may harm the standing and reputation of the Company; (v) a material breach of your duty of loyalty to the Company or your material breach of the Companys written code of conduct and business ethics or Section 2 through 8 of the Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement, or any other agreement between you and the Company; (vi) dishonesty, fraud, gross negligence or repetitive negligence committed without regard to corrective direction in the course of discharge of your duties as an employee; or (vii) excessive and unreasonable absences from your duties for any reason (other than authorized vacation or sick leave) or as a result of your Disability (as defined below).
Disability means your inability to perform the essential functions of your job, with or without accommodation, for an extended period but not less than 60 business days in any consecutive 6 month period, as determined in the sole discretion of the Company.
Good Reason means that you voluntarily terminate your employment with the Company if there should occur, without your written consent:
(i) a material, adverse change in your duties or responsibilities with the Company, provided that
a change in title or a change in the person or office to which you report, shall not, by itself, constitute such a material, adverse change;
(ii) relocation of your principal place of employment by more than 35 miles;
(iii) a reduction in the Initial Base Salary by more than 10% in the aggregate during the term of your employment under this letter or a reduction in your base salary by less than 10% which is not applied to similarly ranked employees; and/or
(iv) the material breach by the Company of any offer letter or employment agreement between you and the Company.
provided, however, that in each case above, (i) you must first give the Company written notice of any of the foregoing within thirty (30) business days following the first occurrence of such event in a written explanation specifying the basis for your belief that you are entitled to terminate your employment for Good Reason, (ii) the Company must have thirty (30) days to cure such event and (iii) provided that the Company does not reasonably cure such event, you must actually resign your employment within ten (10) days following the cure period described in (ii). Otherwise, any claim of such circumstances as Good Reason shall be deemed irrevocably waived by you.
All references to the Company in these definitions shall include parent, subsidiary, affiliate and successor entities of the Company.
Exhibit 10.17
October 3, 2020
William J. Newman, III
[***]
Re: Employment with Cvent, Inc.
Dear Billy:
This is your employment agreement with Cvent, Inc., a Delaware corporation (as such companys name may change from time to time and such companys successors and assigns, the Company). It sets forth the terms of your continued employment by the Company. We are very excited about your continued leadership in Finance and value the role that you will serve on our team going forward.
1. As of August 2020, you have served and will continue to serve as Senior Vice President, Chief Financial Officer of the Company, reporting to the Chief Executive Officer of the Company, or any other officer as directed by the Board of Directors of the Company (the Board) with the consent of the Chief Executive Officer. In this capacity, you will have the responsibilities and duties consistent with such position.
2. Your base salary as of March 15, 2020 was $286,000.00 per year (the Initial Base Salary), less deductions and withholdings required by law or authorized by you, and will be subject to review annually with the rest of the executive management team (customarily in the First Quarter) for any increases or decreases; provided, however, that the aggregate amount of any decreases during the course of your employment hereunder shall not be greater than 10% of the Initial Base Salary, and any such decreases may only be implemented in conjunction with a general decrease affecting the executive management team. Notwithstanding anything in this Employment Agreement to the contrary, until December 31, 2020, as of July 1, 2020, you voluntarily consented to the reduction of your Base Salary by 12%, less applicable withholdings and deductions (the Salary Reduction). You agree that this Salary Reduction and/or any reduction or diminishing of your work schedule, hours and/or duties, did not and does not constitute a breach of the Employment Agreement or Good Reason for any purpose under this Employment Agreement or any other agreement between you and the Company or any of its affiliates, and shall not give rise to any employment related claim or action, and shall not entitle you to any severance or other payment pursuant to this Employment Agreement or otherwise.
Your base salary will be paid by the Company in regular installments in accordance with the Companys general payroll practices as in effect from time to time.
For the 2020 fiscal year, you are currently eligible for an annual bonus target of $78,000 (the Bonus). The Bonus will be awarded at the sole discretion of the Board, based upon the Boards and the Companys Chief Executive Officers mutual determination as to your achievement of predetermined corporate and individual thresholds, including management by objectives (MBO) targets and financial targets such as bookings, revenue, recurring revenue, gross profit and/or EBITDA targets.
With respect to bonus periods beginning on and after January 1, 2021, the bonus formulas, MBOs, performance milestones and all other elements of your bonus opportunities shall be established by the Board, in its sole discretion, and communicated in writing (including email) to you from time to time. Each annual bonus earned for a fiscal year shall be paid within 30 days after the Board has received, reviewed and approved the applicable fiscal years final audited financial statements. In any event, payment of any bonus that becomes due with respect to a fiscal year shall be paid in the calendar year following the calendar year in which the fiscal year ends, subject, in each case, to your continued employment on the applicable payment date.
3. You will also be eligible to participate in health, dental and vision insurance plans and other employee benefit plans established by the Company or its affiliates for their employees from time to time, in accordance with the terms of such plans, so long as they remain generally available to such employees.
4. During your employment, your position shall be based in Tysons Corner, Virginia. Your duties may involve extensive domestic and international travel.
5. In 2017, 2018 and 2019, you received options (the Options) to purchase 721, 117 and 40 shares of Papay Topco, Inc. (Topco), respectively, which were issued under Topcos 2017 Stock Option Plan (as amended, restated or otherwise modified from time to time, the Option Plan) pursuant to Option Grant Agreements entered into on or about May 26, 2017, November 14, 2018 and November 15, 2019, respectively.
6. There are some formalities that you have previously completed and need to continue to uphold as a condition of your continued employment:
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You must carefully consider and sign the Companys updated executive Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement (attached to this letter as Exhibit A). Because the Company and its affiliates are engaged in a continuous program of research, development, production and marketing in connection with their business, we wish to reiterate that it is critical for the Company and its affiliates to preserve and protect their proprietary information and their rights in inventions. |
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So that the Company has proper records of inventions that may belong to you, we ask that you also review and update, if necessary, Schedule 1 attached to Exhibit A. |
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You and the Company mutually agree that any disputes that may arise regarding your employment will be submitted to binding arbitration pursuant to the arbitration clause set forth in Section 10 of Exhibit A. As a condition of your employment, you will need to carefully consider and voluntarily agree to the arbitration clause set forth in Section 10 of Exhibit A. |
7. We also wish to remind you that, as a condition of your employment, you are expected to abide by the Companys, its subsidiaries and affiliates written policies and procedures, which may be amended from time to time, at the Companys sole discretion.
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8. Your employment with the Company is at will. The Company may terminate your employment at any time with or without notice, and for any reason or no reason. You shall be entitled to terminate your employment with the Company at any time and for any reason or no reason by giving notice in writing to the Company of not less than eight (8) weeks (Notice Period), unless otherwise agreed to in writing by you and the Company. In the event of such notice, the Company reserves the right, in its discretion, to give immediate effect to your resignation in lieu of requiring or allowing you to continue to work throughout the Notice Period; provided that, you will receive a cash payment equal to the base salary you would have otherwise earned during the remaining portion of the Notice Period had the Company not given immediate effect to your resignation. You shall continue to be an employee of the Company during the Notice Period, and thus owe to the Company the same duty of loyalty you owed it prior to giving notice of your termination. The Company may, during the Notice Period, relieve you of all of your duties and prohibit you from entering the Companys offices.
9. If the Company terminates your employment without Cause or you voluntarily terminate your employment for Good Reason, you will be entitled to receive (x) a severance payment equal to 12 months of your then applicable base salary, less deductions and withholdings required by law or authorized by you (the Severance Pay); provided that to the extent you receive any remuneration in respect of services performed by you during the period between the date that is 6 months following termination of your employment and the date that is 12 months following termination of your employment, such remuneration shall be offset against and reduce the amounts payable under this clause on a dollar-for-dollar basis (for the avoidance of doubt, you are required to mitigate the payments provided to you under this Section 9(x) by seeking, in good faith, other employment or engagement), (y) solely to the extent approved in writing by the Board and the Chief Executive Officer, a prorated portion of any bonus that you otherwise would have earned during the fiscal year in which such termination occurs had your employment continued and (z) reimbursement of any COBRA premiums you paid for continued health coverage during the 6 month period following the termination of your employment. For purposes of this section, Cause and Good Reason have the meaning set forth in Exhibit B attached hereto. The Company will not be required to pay the Severance Pay unless (i) you execute and deliver to the Company an agreement (Release Agreement) in a form satisfactory to the Company releasing from all liability (other than the payments and benefits contemplated by this letter) the Company, each member and affiliate of the Company, and any of their respective past or present investors, members, officers, directors, managers, employees or agents, which Release Agreement will not contain any additional non-disparagement, non-solicitation or non-competition obligations, and you do not revoke such Release Agreement during any applicable revocation period, (ii) such Release Agreement is executed and delivered (and no longer subject to revocation, if applicable) within 60 days following termination, and (iii) you continue to comply with the provisions of Sections 2 through 8 of Exhibit A, the terms of this letter and any restrictive covenant agreement between you and the Company and the provisions of the Release Agreement. The Severance Pay shall be paid in installments in accordance with the Companys general payroll practices at the time of termination, but no less frequently than monthly, starting on the sixtieth (60th) day following your termination of employment, provided you have executed, delivered, and not revoked the Release Agreement during such revocation period for the Release Agreement described above.
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10. You shall not make any statement that would libel, slander or disparage the Company, any member of the Company or its affiliates or any of their respective past or present officers, directors, managers, stockholders, employees or agents, provided that the foregoing shall not prohibit you from (i) making truthful statements in response to legal process, required governmental testimony or filings, or administrative or arbitral proceedings (including, without limitation, depositions in connection with such proceedings), (ii) making statements that you in good faith believe are necessary or appropriate to make in connection with performing your duties and obligations to the Company, (iii) engaging in concerted activity relative to the terms and conditions of your employment or (iv) in communications protected under the National Labor Relations Act, or from filing a charge or providing information to any governmental agency.
11. While we look forward to a long and profitable relationship, you will continue to be an at-will employee of the Company as described in Section 8 of this letter. Any statements or representations to the contrary (and, indeed, any statements contradicting any provision in this letter) are, and should be regarded by you, as ineffective. Further, your participation in any benefit program or other Company program, if any, is not to be regarded as assuring you of continuing employment for any particular period of time.
12. As noted in your original offer letter, as well as in the Company Handbook, the Company reserves the right to perform background checks during the term of your employment, subject to compliance with applicable laws. You have already executed forms authorizing such a background check. In the event that the Company terminates your employment hereunder due to an unsatisfactory background check, notwithstanding anything herein to the contrary, you will be entitled to the Severance Pay, subject to the conditions set forth in Section 9.
13. Section 2 80G of the Internal Revenue Code
a. In the event that any payment, coverage or benefit provided in respect of your employment with the Company and its affiliates, whether under this letter or otherwise and whether before or after termination of your employment (the Payments), would be subject to the Excise Tax (as defined below), but the imposition of the Excise Tax could be avoided by approval of shareholders described in Section 280G(b)(5)(B) of the Internal Revenue Code of 1986, as amended (the Code), then you may cause the Company or any applicable affiliate of the Company to seek such approval, in which case the Company and any such affiliate will use their reasonable best efforts to cause such approval to be obtained and you will cooperate and execute such waivers as may be necessary so that such approval avoids imposition of any Excise Tax.
b. In the event that any Payment could reasonably be expected to be subject to the Excise Tax and either (i) you do not elect to cause the Company or any applicable affiliate to seek approval of shareholders described in Section 280G(b)(5)(B) of the Code or (ii) such approval would not avoid the imposition of the Excise Tax, then the Company shall reduce (but not below zero) the aggregate present value of the Payments to the Reduced Amount (as defined below), if reducing the Payments will provide you with a greater net after-tax amount than would be the case if no such reduction was made. The Payments shall be reduced as described in the preceding sentence only if (a) the net amount of the Payments, as so reduced (and after subtracting the net amount of federal, state and local income and payroll taxes on the reduced Payments), is greater
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than or equal to (b) the net amount of the Payments without such reduction (but after subtracting the net amount of federal, state and local income and payroll taxes on the Payments and the amount of Excise Tax to which you would be subject with respect to the unreduced Payments). Any reduction shall be made in accordance with Section 409A of the Code.
c. For purposes of this Section 13, the term Reduced Amount shall be an amount expressed in present value that maximizes the aggregate present value of Payments without causing any Payments to be subject to the Excise Tax, determined in accordance with Section 280G(d)(4) of the Code, and the term Excise Tax means the excise tax imposed under Section 4999 of the Code, together with any interest or penalties imposed with respect to such excise tax.
d. All determinations to be made under this Section 13 shall be made by an independent registered public accounting firm or consulting firm selected by the Company and consented to by you immediately prior to a change in control, which shall provide its determinations and any supporting calculations both to the Company and you within 15 days prior to the change in control. All fees and expenses of the accounting or consulting firm in performing the determinations referred to in this Section 12 shall be borne solely by the Company.
14. This letter along with its Exhibits and the documents referred to herein constitute the entire agreement and understanding of the parties with respect to the subject matter of this letter, and supersede all prior understandings and agreements, including but not limited to employment agreements, severance agreements, and bonus agreements, whether oral or written, between or among you and the Company, Parent or any of their respective predecessors or affiliates with respect to the specific subject matter hereof. Waivers or modifications of this letter are valid only if in writing and duly executed by each of the parties hereto.
15. In the event of a conflict between the terms of this letter and the provisions of Exhibit A, the terms of this letter shall prevail.
16. Notwithstanding any other provision herein, the Company shall be entitled to withhold from any amounts otherwise payable hereunder any amounts required to be withheld in respect to federal, state or local taxes. The intent of the parties is that payments and benefits under this letter be exempt from, or comply with, Code Section 409A and the regulations and guidance promulgated thereunder (collectively Code Section 409A) and, accordingly, to the maximum extent permitted, this letter shall be interpreted to be in compliance therewith. In no event whatsoever shall the Company be liable for any additional tax, interest or penalty that may be imposed on you by Code Section 409A or damages for failing to comply with Code Section 409A. To the extent required by Code Section 409A, a termination of employment shall not be deemed to have occurred for purposes of any provision of this letter providing for the payment of any amounts or benefits upon or following a termination of employment unless such termination is also a separation from service within the meaning of Code Section 409A and, for purposes of any such provision of this letter, references to a termination, termination of employment or like terms shall mean separation from service. For purposes of Code Section 409A, your right to receive any installment payments pursuant to this letter shall be treated as a right to receive a series of separate and distinct payments. To the extent that reimbursements or other in -kind benefits under this letter constitute nonqualified deferred compensation for purposes of Code Section 409A, (a) all such expenses or other reimbursements hereunder shall be made on or prior
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to the last day of the taxable year following the taxable year in which such expenses were incurred by you, (b) any right to such reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit, and (c) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year. Notwithstanding anything in this letter to the contrary, if you are a specified employee for purposes of Code Section 409A and if payment of any amounts under this letter is required to be delayed for a period of six months after separation from service pursuant to Code Section 409A, payment of such amounts shall be delayed as required by Code Section 409A, and the accumulated amounts shall be paid in a lump sum payment within 15 days after the end of the six -month period, or if earlier, upon your death.
If you decide to accept the terms of this letter, and I hope you will, please signify your acceptance of these conditions of employment by signing and dating the enclosed copy of this letter and Exhibit A and returning them to me, not later than September 30, 2020. Should you have anything that you wish to discuss, please do not hesitate to contact me at.
* * * *
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By signing this letter and Exhibit A attached hereto, you represent and warrant that you have had the opportunity to seek the advice of independent counsel before signing and have either done so, or have freely chosen not to do so, and either way, you sign this letter voluntarily.
Very truly yours, |
/s/ Rajeev Aggarwal |
Rajeev Aggarwal |
Chief Executive Officer |
I have read and understood this letter and Exhibit A attached and hereby acknowledge, accept and agree to the terms set forth therein.
/s/ William J. Newman, III |
Date signed: |
October 5, 2020 |
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William J. Newman, III |
LIST OF EXHIBITS
Exhibit A: Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement 7
Exhibit B: Certain Definitions
7
EXHIBIT A
CONFIDENTIALITY, INVENTION ASSIGNMENT, NON-SOLICIT, NON-COMPETE AND ARBITRATION AGREEMENT
As a condition of your employment and/or continued employment with Cvent, Inc. (as such companys name may change from time to time and such companys successors and assigns, the Company), and in exchange for the other and valuable consideration recited in Section 1 below, you and the Company agree to the following:
For purposes of this Agreement, references to the Group means the Company, and its affiliates (whether a parent, subsidiary, or sister entity to the Company) engaged in the same line of business or contemplated business as the Company.
1. |
CONSIDERATION FOR AGREEMENT. |
You understand that the Group is engaged in a continuous program of research, development, production and marketing in connection with its business and that it is critical for the Group to preserve and protect its Proprietary Information (as defined in Section 2 below), its rights in Inventions (as defined in Section 4 below) and in all related intellectual property rights. You acknowledge that, as a result of your employment with the Company and/or its predecessors, you have and/or may receive confidential information, trade secrets, and/or specialized training from the Group, each of which constitutes good and valuable consideration in support of your obligations made under this Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement (this Agreement). As additional consideration, you may also have the opportunity to develop valuable business relationships with employees, agents, suppliers, and customers of the Group and to use the Groups resources and goodwill in the marketplace to develop those relationships. Finally, by your signature below, you acknowledge that both the consideration outlined in your offer of employment from the Company and/or the letter to which this Agreement is attached and your continued employment with the Company (subject to Section 9), which the Company would not allow but for your execution of this Agreement, constitute additional consideration in support of your return promise to maintain the confidentiality of all specialized knowledge and confidential information as well as your promise to adhere to the other restrictions listed in this Agreement, including but not limited to those restrictions described in Section 7 of this Agreement.
2. |
PROPRIETARY INFORMATION. |
You understand that your employment creates a relationship of confidence and trust with respect to any information of a confidential or secret nature that may be disclosed to you or created by you that relates to the business of the Group or to the business of its customers, licensees, suppliers or any other party with whom the Group agrees to hold information of such party in confidence (the Proprietary Information).
You understand and agree that the term Proprietary Information includes but is not limited to information of all types contained in any medium (paper, electronic, in your memory, or otherwise stored or recorded), whether oral or written and regardless of whether it is marked as confidential,
proprietary or a trade secret. Proprietary Information includes, without limitation, the following information and materials, whether having existed, now existing or developed or created by you or on your behalf during your term of employment with the Company or its predecessor:
A) |
All information and materials relating to the existing software products and software in the various stages of research and development, including, but not limited to, source codes, object codes, design specifications, design notes, flow charts, graphics, graphical user interfaces, coding sheets, product plans, know-how, negative know how, test plans, business investment analysis, marketing and functional requirements, algorithms, product bugs and customer technical support cases which relate to the software; |
B) |
Internal business information, procedures and policies, including, but not limited to, licensing techniques, vendor names, other vendor information, business plans, financial information, budgets, forecasts, product margins, product costs, service and/or operation manuals and related documentation including drawings, and other such information, whether written or oral, which relates to the way the Group conducts its business; |
C) |
All legal rights, including but not limited to, trade secrets, pending patents, Inventions (as that term is defined in Section 4 below) and other discoveries, claims, litigation and/or arbitrations involving the Group, pending trademarks, copyrights, proposed advertising, public relations and promotional campaigns and like properties maintained in confidence; |
D) |
Any and all customer sales and marketing information, including but not limited to sales forecasts, marketing and sales promotion plans, product launch plans, sales call reports, competitive intelligence information, customer information, customer lists, customer needs and buying habits, sales and marketing studies and reports, internal price list, discount matrix, customer data, customer contracts, pricing structures, customer negotiations, customer relations materials, customer service materials, past customers, and the type, quantity and specifications of products purchased, leased or licensed by customers of the Group; |
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E) |
Any information obtained while working for the Group which gives the Group a competitive edge; |
F) |
Any other knowledge or information regarding the property, business, and affairs of the Group which the Group endeavors to keep confidential or which the Group believes to be confidential; and |
G) |
Any and all other trade secrets, as that term is defined under applicable laws. |
You understand and agree to treat and preserve Proprietary Information and materials as strictly confidential. Except as authorized by the Companys Chief Executive Officer (but in all cases preserving confidentiality by following Company policies and obtaining appropriate non-disclosure agreements), you further agree that, during your employment with the Company or thereafter, you will not directly or indirectly transmit or disclose Proprietary Information to any person, corporation, or other entity for any reason or purpose whatsoever, except in connection with the performance of your employment duties.
You understand and agree that the Proprietary Information is the exclusive property of the Group, and that, during your employment, you will use and disclose Proprietary Information only for the Groups benefit and in accordance with any restrictions placed on its use or disclosure by the Group. After termination of your employment for any reason, you will not use in any manner or disclose any Proprietary Information, except to the extent compelled by applicable law; provided that in the event you receive notice of any effort to compel disclosure of Proprietary Information for any reason, you will promptly and in advance of disclosure notify Company of such notice and fully cooperate with all lawful Company or Group efforts (through their counsel or otherwise) to resist or limit such disclosure.
Proprietary Information does not include information (i) that was or becomes generally available to you on a non-confidential basis, if the source of this information was not reasonably known to you to be bound by a duty of confidentiality, or (ii) that was or becomes generally available to the public, other than as a result of a disclosure by you, directly or indirectly or any other breach of this Agreement.
3. THIRD PARTY INFORMATION. You recognize that the Group has received and in the future will receive from third parties their confidential or proprietary information subject to a duly on the Groups part to maintain the confidentiality of such information and to use it only for certain limited purposes. You agree that you owe the Group and such third parties, during the term of your employment, and thereafter, a duty to hold all such confidential or proprietary information in the strictest confidence and not to disclose it to any person, firm or corporation (except as necessary in carrying out your work for the Group consistent with the Groups agreement with such third party) or to use it for the benefit of anyone other than for the Group or such third party (consistent with the Companys agreement with such third party) without the express written
authorization of the Chief Executive Officer of the Company. All rights and benefits afforded to the Company under this Agreement shall apply equally to the owner of the third party information with respect to the third party information, and such third party is an intended third party beneficiary of this Agreement, with respect to the third party information. You further agree to conform to the Companys privacy policies, as amended from time to time.
4. |
INVENTIONS. |
4.1 Prior Inventions. You have attached hereto as Schedule 1 a complete and accurate list describing all Inventions (as defined below) which were discovered, created, invented, developed or reduced to practice by you prior to the commencement of your employment by the Company and have not been legally assigned or licensed to the Company (collectively: Prior Inventions), which belong solely to you or belong to you jointly with others, which relates in any way to any of the Groups current, proposed or reasonably anticipated businesses, products or research or development and which are not assigned to the Group hereunder; or have initialed Schedule 1 to indicate you have no Prior Inventions to disclose.
If, in the course of your employment with the Company, you incorporate or cause to be incorporated into a Group product, service, process, file, system, application or program a Prior Invention owned by you or in which you have an interest, you hereby grant the Group member a non-exclusive, royalty-free, irrevocable, perpetual, worldwide, sublicensable and assignable license to make, have made, copy, modify, make derivative works of, use, offer to sell, sell or otherwise distribute such Prior Invention as part of or in connection with such product, process, file, system, application or program.
4.2 Disclosure of Inventions. You will promptly disclose in confidence to the Company all Inventions that you make or conceive or first reduce to practice or create, either alone or jointly with others, during the period of your employment, and for a period of three (3) months thereafter, whether or not in the course of your employment, and whether or not such Inventions are patentable, copyrightable or protectable as trade secrets. For purposes of this Agreement, Inventions means without limitation, formulas, algorithms, processes, techniques, concepts, designs, developments, technology, ideas, patentable and unpatentable inventions and discoveries, copyrights and works of authorship in any media now known or hereafter invented (including computer programs, source code, object code, hardware, firmware, software, mask work, applications, files, Internet site content, databases and compilations, documentation and related items) patents, trade and service marks, logos, trade dress, corporate names and other source indicators and the good will of any business symbolized thereby, trade secrets, know-how, confidential and proprietary information, documents, analyses, research and lists (including current and potential customer and user lists) and all applications and registrations and recordings, improvements and licenses related to any of the foregoing. You recognize that Inventions or Proprietary Information relating to your activities
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while working for the Company, and conceived, reduced to practice, created, derived, developed, or made by you, alone or with others, within three (3) months after termination of your employment may have been conceived, reduced to practice, created, derived, developed, or made, as applicable, in significant part while you were employed by the Company. Accordingly, you agree that such Inventions and Proprietary Information shall be presumed to have been conceived, reduced to practice, created, derived, developed, or made, as applicable, during your employment with the Company and are to be assigned to the Company pursuant to this Agreement and applicable law unless and until you have established the contrary by clear and convincing evidence.
4.3 Work for Hire, Assignment of Inventions. You acknowledge and agree that any copyrightable works prepared by you, either alone or jointly with others, within the scope of your employment are works made for hire under the Copyright Act and that the Company will be considered the author and owner of such copyrightable works. Any copyrightable works the Company or a Group member specially commissions from you while you are employed with the Company shall be deemed a work made for hire under the Copyright Act and if for any reason a work cannot be so designated as a work made for hire, you agree to and hereby assign to the Company all right, title and interest in and to said work(s) and the related copyright(s). You agree to and hereby grant the Company a non-exclusive, royalty-free, irrevocable, perpetual, worldwide, sublicensable and assignable license to make, have made, copy, modify, make derivative works of, use, publicly perform, display or otherwise distribute any copyrightable works you create during the time you are employed with the Company that for any reason do not qualify as a work made for hire, that were not specially commissioned by the Group, or both, but that relate in any way to the business of the Group. You agree that all Inventions that (i) are developed using equipment, supplies, facilities Proprietary Information, or trade secrets of the Group, (ii) result from work performed by you for the Group and/or on Company time, or (iii) relate to the Groups business or current or anticipated research and development (the Assigned Inventions), will be the sole and exclusive property of the Company and you agree to and hereby irrevocably assign the Assigned Inventions to the Company
4.4 Assignment of Other Rights. In addition to the foregoing assignment of Assigned Inventions to the Company, you hereby irrevocably transfer and assign to the Company: (i) all worldwide patents, patent applications, copyrights, mask works, trade secrets and other intellectual property rights in any Assigned Invention, and (ii) any and all Moral Rights (as defined below) that you may have in or with respect to any Assigned Inventions. You also hereby forever waive and agree never to assert any and all Moral Rights you may have in or with respect to any Assigned Inventions, even after termination of your work on behalf of the Company. Moral Rights mean any rights to claim authorship of any Assigned Inventions, to object to or prevent the modification of any Assigned Inventions, or to withdraw from circulation or control the
publication or distribution of any Assigned Inventions, and any similar right, existing under judicial or statutory law of any country in the world, or under any treaty, regardless of whether or not such right is denominated or generally referred to as a moral right.
4.5 Assistance. Whether during or after your employment, and without additional compensation, you agree to do any act and/or execute any document deemed necessary or desirable by the Company in furtherance of perfecting, prosecuting, recording, maintaining, enforcing and protecting the Groups right, title and interest in and to, any of the Assigned Inventions. In the event that the Company is unable for any reason to secure your signature to any document required to file, prosecute, register or memorialize the ownership and/or assignment of, or to enforce, any intellectual property, you hereby irrevocably designate and appoint the Companys duly authorized officers and agents as your agents and attorneys-in-fact to act for and on your behalf and stead to (i) execute, file, prosecute, register and/or memorialize the assignment and/or ownership of any Assigned Invention; (ii) to execute and file any documentation required for such enforcement and (iii) do all other lawfully permitted acts to further the filing, prosecution, registration, memorialization of assignment and/or ownership of, issuance of and enforcement of any Assigned Inventions, all with the same legal force and effect as if executed by you.
4.6 Applicability to Past Activities. To the extent you have been engaged to provide services by the Company or its predecessor for a period of time before the effective date of this Agreement (the Prior Engagement Period), you agree that if and to the extent that, during the Prior Engagement Period: (i) you received access to any information from or on behalf of the Company that would have been Proprietary Information if you had received access to such information during the period of your employment with the Company under this Agreement; or (ii) you conceived, created, authored, invented, developed or reduced to practice any item, including any intellectual property rights with respect thereto, that would have been an Invention if conceived, created, authored, invented, developed or reduced to practice during the period of your employment with the Company under this Agreement; then any such information shall be deemed Proprietary Information hereunder and any such item shall be deemed an Invention hereunder, and this Agreement shall apply to such information or item as if conceived, created, authored, invented, developed or reduced to practice under this Agreement.
5. NO BREACH OF PRIOR AGREEMENT. You represent that your performance of all the terms of this Agreement and your duties as an employee of the Company will not breach any invention assignment, proprietary information, confidentiality, noncompetition, nonsolicitation, noninterference, or similar agreement with any former employer or other party. You represent that you will not bring with you to the Company or use in the performance of your duties for the Company any documents or materials or intangibles of a former employer or third party that are not in the public domain or have not been legally transferred or licensed to the Company.
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6. DUTY OF LOYALTY. You understand that your employment with the Company requires your undivided attention and effort during normal business hours. While you are employed by the Company, you will not, without the Companys express prior written consent, (i) engage in any other business activity unless such activity is not competitive with the Group and does not materially interfere with your full-time employment hereunder (as determined in good faith by the good faith board of directors of the Company (after consultation with the Companys Chief Executive Officer), (ii) be engaged or interested, directly or indirectly, alone or with others, in any trade, business or occupation in competition with the Group, (iii) make preparations, alone or with others, to compete with the Group in the future, or (iv) appropriate for your own benefit business opportunities pertaining to the Groups business. The obligations imposed on you under the Section 6 are in addition to, and do not supplant, any similar obligations you may have to the Group under the common law or by statute.
7. DUTY OF NON INTERFERENCE. For purposes of this Section, solicit means any direct or indirect communication of any kind, regardless of who initiates it, that in any way invites, advises, encourages or requests any person to take or refrain from taking any action.
7.1 Non-Solicitation of Employees/Consultants. During your employment with the Group and for a period of two (2) years thereafter, you will not directly or indirectly hire, attempt to hire, recruit, offer employment, lure or entice away, or in any other manner persuade or otherwise solicit anyone who is then an employee or consultant of the Group (or who was an employee or consultant of the Group within the six months preceding the date of any such prohibited conduct) to resign from the Group or to apply for or accept employment with, or otherwise provide services to, you or any third party, for your own benefit or for the benefit of any other person or entity.
7.2 Non-Solicitation of Customers. During your employment with the Company and for a period of two years (2) year thereafter, you will not, whether as an owner, employee, member, director, officer, trustee, agent, contractor, consultant or otherwise, directly or indirectly (i) solicit or accept from any Customer or Potential Customer (as defined below) any business involving the sale or provision of Restricted Products (as defined in section 7.3); (ii) request or advise any Customer of the Group to curtail, cancel, or withdraw its business from the Group; or (iii) aid in any way any other entity in obtaining business from any Customer or Potential Customer involving the sale or provision of Restricted Products (as defined in section 7.3). Customer means any person or entity who is or was, during the last 24 months of your employment with the Company (including any period of employment with any predecessor of the Company) either (a) a customer of the Company or (b) a customer of any Group company and, (c) with whom you dealt on behalf of the Company or a Group member or their predecessor; (d) whose dealings with the Company or a Group member or their
predecessor were coordinated or supervised by you; (e) about whom you obtained Proprietary Information as a result of your association with the Company or a Group member or their predecessor; or (f) to whom you provided services on behalf of the Company or a Group member or their predecessor. Potential Customer means any person or entity (a) with whom you were directly involved in the solicitation or targeting of such potential customer or to whom you provided services on behalf of any Group company during the six months preceding the termination of your employment or (b) about whom you became privy to Proprietary Information as a result of your employment during the last six months of your employ.
7.3 Non-Competition. During your employment with the Company and for a period of two (2) years thereafter (the Restricted Period), you will not hold any position or role outside the Company or the Group, whether such position or role be an employee, officer, director, consultant, owner, manager, advisor, investor, or otherwise, through which you would, directly or indirectly, provide competing services with the business of the Group or that would enable you or another third party to unfairly compete with the business of the Group. By way of limitation to the foregoing, the following shall be considered competitive with the business of the Group: (i) the provision of services with respect to or the sale of Restricted Products, within 50 miles of any Group Customer, (ii) the provision of services with respect to or sale of Restricted Products within 50 miles of any Group Office or (iii) the research, development, manufacturing or distribution of Restricted Products that will be sold within 50 miles of any Group Customer or Group Office. For purposes of this section, Restricted Products means products or services (a) which are of the same or materially similar kind as the products or services (including but not limited to technical and product support, professional services, technical advice and other customer services) researched into, developed, manufactured, distributed, sold or supplied by the Group and (b) (1) with which you were directly connected during your employment with the Company or its predecessor or (2) about which you have received or developed Proprietary Information by reason of your employment with the Company or its predecessor or provision of services to any member of the Group. Group Customer means a customer with respect to which you provided services, had business dealings or about which you received or developed Proprietary Information. Group Office means an office of the Company or a Group company with respect to which you provided services, had business dealings or about which you received or developed Proprietary Information. Notwithstanding the foregoing, by providing prior notice to the Company you may accept employment or otherwise be engaged in or involved with a competitor of the Group that has multiple lines of business provided that, during the Restricted Period, you are employed by a business unit of such competitor that is not engaged or otherwise involved with Restricted Products OR you are providing services to the competitor that are unrelated to the services you provided to the Company and that will not confer an unfair business advantage to such competitor by virtue of the Proprietary Information in your possession. Nothing contained in this Section 7 shall
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prohibit you from owning of a passive investment interest of not more than 2.5% in a company with publicly traded equity securities, and whether on your own behalf or on behalf of others. You agree that the Restricted Period shall be extended by a period equal the length of any violation of this Section 7.3.
8. |
OBLIGATIONS UPON TERMINATION. |
8.1 Return of Company Property. At the time of leaving the employ of the Company, you will deliver to the Company (and will not keep in your possession or deliver to anyone else) (i) any and all documents and materials of any nature (including physical and electronic copies) pertaining to your work, including without limitation devices, records, data, notes, reports, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, equipment, other documents or property, or reproductions of any aforementioned items and (ii) all property belonging to the Group or any third party which provided property to you in connection with your employment such as computer, laptops, personal digital assistants, cell phones, MP3 players, electronic organizers and other devices, cards, car, keys, security devices or any other item belonging to the Group. Upon Company request, you will execute a document confirming your compliance with this provision and the terms of this Agreement.
8.2 Notification of New Employer. Before you accept employment or enter in to any consulting or other professional or business engagement with any other person or entity while any of Section 7 is in effect, you will provide such person or entity with written notice of the provisions of Section 7 and will deliver a copy of the notice to the Company. You hereby grant consent to notification by the Company to your new employer about your rights and obligations under this Agreement.
8.3 Withholding. To the extent allowed by law and permitted by Section 409A of the Internal Revenue Code, you agree to allow Company to deduct from your final paycheck(s) any amounts payable by you as a result of your employment, including but not limited to, any expense advances or business charges incurred by you on behalf of the Group, charges for property damaged or not returned when requested, and any other charges incurred by you payable to the Group. You agree to execute any authorization form as may be provided by Company to effectuate this provision.
9. |
AT WILL EMPLOYMENT. |
This Agreement does not constitute a contract of employment for any definite period of time. You acknowledge and agree that nothing in this Agreement modifies the at-will nature of your employment with Company, which permits either yourself or Company to terminate your employment at any time and without cause.
10. |
ARBITRATION. |
10.1 In the event of any controversy or dispute between you and the Company or between you and any affiliate or an agent of Company, including but not limited to directors, officers,
managers, other employees or members of the Group, who are being sued in any capacity, as to all or any part of this Agreement, any other agreement, any dispute or controversy whatsoever pertaining to or arising out of the relationship between you and the Company and/or the Group or the dissolution or termination of same, and/or the arbitrability thereof (collectively, Arbitrable Disputes as further defined below) shall, subject to Section 11.1 herein, be resolved exclusively by binding arbitration solely between yourself and the Company and/or person or entity described above, conducted in Washington, D.C. The arbitration shall be governed by the Federal Arbitration Act, 9 U.S.C. Section 1 et seq, as amended, and shall be administered in accordance with the procedures set forth in the Dispute Resolution Addendum appended hereto as Schedule 2 (the Addendum), all of which are incorporated into this Agreement by this reference.
10.2 Arbitrable Disputes shall include any and all disputes not specifically exempted from arbitration herein, including, but not limited to, any alleged violations of federal, state or local constitutions, statutes, laws, ordinances, regulations or common law, any claims of wrongful termination, unlawful discrimination, harassment or retaliation, including but not limited to Title VII of the 1964 Civil Rights Act, The Equal Pay Act, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the Fair Labor Standards Act and similar state and local statutes, any claims of breach of contract or any implied covenant of good faith and fair dealing, any claims of adverse treatment in violation of public policy, and any disputes arising from, under or regarding this Agreement, including the formation, validity, interpretation, effect or breach of the Agreement. For avoidance of doubt, all disputes regarding the validity of this Agreement, the validity of the arbitration provisions of this Agreement, or whether any particular claim or matter is included within the scope of the arbitration provisions of this Agreement, are Arbitrable Disputes subject to arbitration as described herein.
Specifically excluded from Arbitrable Disputes are disputes or claims arising from or related to workers compensation and unemployment insurance, and any claims which are expressly excluded from binding arbitration by statute or public policy, or which are expressly required to be arbitrated under a different procedure.
10.3 While you are not required to do so before serving an arbitration demand under Section (g) of the Addendum, nothing in this Agreement shall prevent you from filing or maintaining an administrative charge or complaint with a government agency, including but not limited to, the Equal Employment Opportunity Commission, the Department of Labor and the National Labor Relations Board or any equivalent state or local agency. For the avoidance of doubt, if you choose not to file an administrative charge or complaint before commencing an arbitration in accordance with this Section 10 and the Addendum, your arbitration demand must be served, subject to Section 10.5, within the applicable time period for filing a charge with the relevant agency in order to be timely filed.
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10.4 This binding arbitration procedure shall supplant and replace claims in court (except as specified herein), and you expressly waive the right to a civil court action before a jury.
10.5 In accordance with Section (g) of the Addendum and to the extent permitted by applicable law, any arbitration relating to or arising from any Arbitrable Dispute shall be commenced by service of an arbitration demand on or before the earlier of: (i) the expiration of the limitations period provided by applicable law; or (ii) the one-year anniversary of the accrual of the aggrieved partys claim.
10.6 All Arbitrable Disputes under this Agreement must be brought in your individual capacity, and not as a plaintiff or class member in any purported class, representative or collective proceeding. You agree that the arbitrator is not empowered to consolidate claims of different individuals into one proceeding, or to hear an arbitration as a class arbitration. To the extent the arbitrator determines that this class/collective action waiver is invalid, for any reason, this entire Section 10 shall be null and void but only with regard to that particular proceeding in which the arbitrator invalidated this class/collective action waiver and this Section 10 shall remain in full force and effect with respect to any Arbitrable Disputes other than that covered by such class/collective action proceeding.
10.7 Notwithstanding the foregoing, the waiver of the jury trial right shall survive even in the event this Section 10 is deemed null and void.
11. |
GENERAL |
11.1 Injunctive Relief. Notwithstanding the arbitration provisions in Section 10 or anything else to the contrary in this Agreement, you and the Company understand and agree that the parties actions or potential actions concerning obligations under Sections 2, 3, 4, 6 or 7 of this Agreement may result in irreparable and continuing damage to the other party for which monetary damages will not be sufficient, and agree that both parties will be entitled to seek, in addition to its other rights and remedies hereunder or at law and both before or while an arbitration is pending between the parties under Section 10 of this Agreement, a temporary restraining order, preliminary injunction or similar injunctive relief from a court of competent jurisdiction in order to preserve the status quo or prevent irreparable injury pending the full and final resolution of the dispute through arbitration, without the necessity of showing any actual damages or that monetary damages would not afford an adequate remedy, and without the necessity of posting any bond or other security. The aforementioned injunctive relief shall be in addition to, not in lieu of, legal remedies, monetary damages or other available forms of relief through arbitration proceedings. This Section shall not be construed to limit the obligation for either party to pursue arbitration under Section 10 with respect to any Arbitrable Disputes.
11.2 Waiver of Breach. The failure of Company at any time, or from time to time, to require performance of any of your
obligations under this Agreement shall not be deemed a waiver of and shall in no manner affect Companys right to enforce any provision of this Agreement at a subsequent time. The waiver by Company of any rights arising out of any breach shall not be construed as a waiver of any rights arising out of any subsequent breach.
11.3 Non Disparagement, During and after your employment with the Company, except to the extent compelled or required by law, you agree you shall not disparage the Group, its customers and suppliers or their respective officers, directors, agents, servants, employees, attorneys, shareholders, successors or assigns or their respective products or services, in any manner (including but not limited to, verbally or via hard copy, websites, blogs, social media forums or any other medium); provided, however, that nothing in this Section shall prevent you from: engaging in concerted activity relative to the terms and conditions of your employment and in communications protected under the National Labor Relations Act, filing a charge or providing information to any governmental agency, or from providing information in response to a subpoena or other enforceable legal process or as otherwise required by law.
11.4 Applicable Law. This Agreement shall be governed by the laws of the State of Virginia, irrespective of its choice of law rules.
11.5 Entire Agreement. This Agreement along with Schedules 1 and 2 and the documents referred to herein constitute the entire agreement and understanding of the parties with respect to the subject matter of this Agreement, and supersede all prior understandings and agreements, whether oral or written, between or among the parties hereto with respect to the specific subject matter hereof. [Notwithstanding the foregoing, this Agreement does not supplant any rights the Group may have under the common law or by statute. Additionally, and notwithstanding the above language of this Section 11.6, you acknowledge and agree that the restrictive covenants you executed in favor of Cvent, Inc. (the Prior Agreement) shall remain in full force and effect; however, in the event of any inconsistency between the Prior Agreement and this Agreement, the terms and provisions of this Agreement and its attachments shall govern.] If any of Section 7 of this Agreement is deemed void, voidable, or otherwise invalid in legal proceedings, you agree that you shall comply with, and the Company may seek to enforce such provisions of the Prior Agreement against you. Headings are provided for convenience only and do not modify, broaden, define or restrict any provision. No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, will be effective unless in writing signed by the parties.
11.6 Survival. Any termination of this Agreement, regardless of how such termination may occur, shall not operate to terminate Sections 2, 3, 4, 5, 7, 8, 10 and 11 which shall survive any such termination and remain valid, enforceable and in full force and effect.
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[SIGNATURE PAGE FOLLOWS]
CVENT, INC. | ||||||||
By: |
/s/ Rajeev Aggarwal |
By: |
/s/ William Newman, III |
|||||
Name: Rajeev Aggarwal | Name of employee: William Newman, III | |||||||
Title: Chief Executive Officer | ||||||||
Date: October 5, 2020 | Date: October 5, 2020 |
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EXHIBIT B
Certain Definitions
Cause means any of the following: (i) a material failure by you to perform your responsibilities or duties to the Company under this letter or those other responsibilities or duties as requested from time to time by the Board, after demand for performance has been given by the Board that identifies how you have not performed your responsibilities or duties; (ii) your engagement in illegal or improper conduct or in gross misconduct; (iii) your commission or conviction of, or plea of guilty or nolo contendere to, a felony that the Board in good faith believe will not materially harm the standing and reputation of the Company; (iv) your commission or conviction of, or plea of guilty or nolo contendere to, any felony other than the type set forth in clause (iii), a crime involving moral turpitude or any other act or omission that the Company in good faith believes may harm the standing and reputation of the Company; (v) a material breach of your duty of loyalty to the Company or your material breach of the Companys written code of conduct and business ethics or Section 2 through 8 of the Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement, or any other agreement between you and the Company; (vi) dishonesty, fraud, gross negligence or repetitive negligence committed without regard to corrective direction in the course of discharge of your duties as an employee; or (vii) excessive and unreasonable absences from your duties for any reason (other than authorized vacation or sick leave) or as a result of your Disability (as defined below).
Disability means your inability to perform the essential functions of your job, with or without accommodation, for an extended period but not less than 60 business days in any consecutive 6 month period, as determined in the sole discretion of the Company.
Good Reason means that you voluntarily terminate your employment with the Company if there should occur, without your written consent:
(i) you are not promoted to Senior Vice President, Chief Financial Officer on the date that is
the earlier of (a) the day the Board of Directors approves resolutions appointing officers of the Company after a Sale of the Company (as that term is defined in the 2017 Stock Option Plan) and
(b) September 15, 2020;
(ii) a
material, adverse change in your duties or responsibilities with the Company, provided that a change in title or a change in the person or office to which you report, shall not, by itself, constitute such a material, adverse change;
provided, however, that after the promotion contemplated in (i) immediately above, any change in title whereby Chief Financial Officer is removed shall constitute a material, adverse change; relocation of your
principal place of employment by more than 35 miles;
(iii) relocation of your principal place of employment by more than 35 miles;
(iv) a reduction in the Initial Base Salary by more than 10% in the aggregate during the term of your employment under this letter or a reduction in your base salary by less than 10% which is not applied to similarly ranked employees; and/or
(v) the material breach by the Company of any offer letter or employment agreement between you and the Company.
provided, however, that in each case above, (i) you must first give the Company written notice of any of the foregoing within thirty (30) business days following the first occurrence of such event in a written explanation specifying the basis for your belief that you are entitled to terminate your employment for Good Reason, (ii) the Company must have thirty (30) days to cure such event and (iii) provided that the Company does not reasonably cure such event, you must actually resign your employment within ten (10) days following the cure period described in (ii). Otherwise, any claim of such circumstances as Good Reason shall be deemed irrevocably waived by you.
All references to the Company in these definitions shall include parent, subsidiary, affiliate and successor entities of the Company.
Exhibit 10.18
June 6, 2017
Lawrence Samuelson
[***]
Re: Employment with Cvent, Inc.
Dear Lawrence:
This is your employment agreement with Cvent, Inc., a Delaware corporation (as such companys name may change from time to time and such companys successors and assigns, the Company). It sets forth the terms of your continued employment by the Company, which shall be effective as of the closing (the Closing) of the transactions (the Transaction) contemplated by that certain Agreement and Plan of Merger, dated as of April 17, 2016, by and among the Company, Papay Holdco, LLC, a Delaware limited liability company (Parent) and Papay Merger Sub, Inc., a Delaware corporation, pursuant to which the Company became a wholly-owned subsidiary of Parent on November 29, 2016 (the Closing Date). We are very excited about this opportunity and value the role that you will serve on our team going forward.
1. You will be the Senior Vice President, General Counsel & Corporate Secretary of the Company, reporting to the Chief Executive Officer of the Company, or any other officer as directed by the Board of Directors of the Company (the Board) with the consent of the Chief Executive Officer. In this capacity, you will have the responsibilities and duties consistent with such position.
2. Effective as of March 1, 2017, your base salary will be $279,339.00 per year (the Initial Base Salary), less deductions and withholdings required by law or authorized by you. The Chief Executive Officer and Board of Directors agree to reassess your base salary from a market perspective in November 2017 and will, based on company and individual performance, determine if you are eligible for an increase effective as of November 29, 2017. If your base salary is not raised as of November 29, 2017, then your next annual base salary review will occur during the 2017 performance year review process, with any compensation changes effective March 1, 2018. If your base salary is raised as of November 29, 2017, then your next annual base salary review will occur during the 2018 performance year review process, with any compensation changes effective March 1, 2019, and thereafter will be subject to review annually for any increases or decreases; provided, however, that the aggregate amount of any decreases during the course of your employment hereunder shall not be greater than 10% of the Initial Base Salary, and any such decreases may only be implemented in conjunction with a general decrease affecting the executive management team. Your base salary will be paid by the Company in regular installments in accordance with the Companys general payroll practices as in effect from time to time.
For the bonus period beginning on January 1, 2017, you will be eligible to receive an annual bonus (the Bonus) with a target amount equal to $53,150.00. The Bonus will be awarded at the sole discretion of the Board, based upon the Boards and the Companys Chief Executive Officers mutual determination as to your achievement of predetermined thresholds, which may
include management by objectives (MBO) targets and financial targets such as bookings, revenue, recurring revenue, gross profit and/or EBITDA targets. In addition, you may be eligible for an additional stretch bonus (the Stretch Bonus), awarded at the discretion of the Board and the Companys Chief Executive Officer, based on the Boards and the Companys Chief Executive Officers mutual determination as to your achievement of stretch targets.
With respect to bonus periods beginning on and after January 1, 2018, the bonus formulas, MBOs, performance milestones and all other elements of your bonus opportunities shall be established by the Board, in its sole discretion, and communicated in writing (including email) to you from time to time. Each annual bonus earned for a fiscal year shall be paid within 30 days after the Board has received, reviewed and approved the applicable fiscal years final audited financial statements. In any event, payment of any bonus that becomes due with respect to a fiscal year shall be paid in the calendar year following the calendar year in which the fiscal year ends, subject, in each case, to your continued employment on the applicable payment date.
3. You will also be eligible to participate in health, dental and vision insurance plans and other employee benefit plans established by the Company or its affiliates for their employees from time to time, in accordance with the terms of such plans, so long as they remain generally available to such employees.
4. During your employment, your position shall be based in Tysons Corner, Virginia. Your duties may involve extensive domestic and international travel.
5. You received options (the Options) to purchase 1,683.00 shares of Papay Topco, Inc. (Topco), which shall be issued under Topcos 2017 Stock Option Plan (as amended, restated or otherwise modified from time to time, the Option Plan) pursuant to an Option Grant Agreement entered into on or about May 26, 2017.
6. There are some formalities that you need to complete as a condition of your employment:
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You must carefully consider and sign the Companys standard Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement (attached to this letter as Exhibit A). Because the Company and its affiliates are engaged in a continuous program of research, development, production and marketing in connection with their business, we wish to reiterate that it is critical for the Company and its affiliates to preserve and protect their proprietary information and their rights in inventions. |
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So that the Company has proper records of inventions that may belong to you, we ask that you also complete Schedule 1 attached to Exhibit A. |
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You and the Company mutually agree that any disputes that may arise regarding your employment will be submitted to binding arbitration pursuant to the arbitration clause set forth in Section 10 of Exhibit A. As a condition of your employment, you will need to carefully consider and voluntarily agree to the arbitration clause set forth in Section 10 of Exhibit A. |
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7. We also wish to remind you that, as a condition of your employment, you are expected to abide by the Companys, its subsidiaries and affiliates written policies and procedures, which may be amended from time to time, at the Companys sole discretion.
8. Your employment with the Company is at will. The Company may terminate your employment at any time with or without notice, and for any reason or no reason. You shall be entitled to terminate your employment with the Company at any time and for any reason or no reason by giving notice in writing to the Company of not less than eight (8) weeks (Notice Period), unless otherwise agreed to in writing by you and the Company. In the event of such notice, the Company reserves the right, in its discretion, to give immediate effect to your resignation in lieu of requiring or allowing you to continue to work throughout the Notice Period; provided that, you will receive a cash payment equal to the base salary you would have otherwise earned during the remaining portion of the Notice Period had the Company not given immediate effect to your resignation. You shall continue to be an employee of the Company during the Notice Period, and thus owe to the Company the same duty of loyalty you owed it prior to giving notice of your termination. The Company may, during the Notice Period, relieve you of all of your duties and prohibit you from entering the Companys offices.
9. If the Company terminates your employment without Cause or you voluntarily terminate your employment for Good Reason, you will be entitled to receive (x) a severance payment equal to 12 months of your then applicable base salary, less deductions and withholdings required by law or authorized by you (the Severance Pay); provided that to the extent you receive any remuneration in respect of services performed by you during the period between the date that is 6 months following termination of your employment and the date that is 12 months following termination of your employment, such remuneration shall be offset against and reduce the amounts payable under this clause on a dollar-for-dollar basis, (y) solely to the extent approved in writing by the Board and the Chief Executive Officer, a prorated portion of any bonus that you otherwise would have earned during the fiscal year in which such termination occurs had your employment continued and (z) reimbursement of any COBRA premiums you paid for continued health coverage during the 6 month period following the termination of your employment. For purposes of this section, Cause and Good Reason have the meaning set forth in Exhibit B attached hereto. The Company will not be required to pay the Severance Pay unless (i) you execute and deliver to the Company an agreement (Release Agreement) in a form satisfactory to the Company releasing from all liability (other than the payments and benefits contemplated by this letter) the Company, each member and affiliate of the Company, and any of their respective past or present investors, members, officers, directors, managers, employees or agents, which Release Agreement will not contain any additional non-disparagement, non-solicitation or non-competition obligations, and you do not revoke such Release Agreement during any applicable revocation period, (ii) such Release Agreement is executed and delivered (and no longer subject to revocation, if applicable) within 60 days following termination, and (iii) you continue to comply with the provisions of Sections 2 through 8 of Exhibit A, the terms of this letter and any restrictive covenant agreement between you and the Company and the provisions of the Release Agreement. The Severance Pay shall be paid in installments in accordance with the Companys general payroll practices at the time of termination, but no less frequently than monthly, starting on the sixtieth (60th) day following your termination of employment, provided you have executed, delivered, and not revoked the Release Agreement during such revocation period for the Release Agreement described above.
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For the avoidance of doubt, you shall not be required to mitigate the payments provided to you under this Section 9 by seeking other employment or engagement, nor shall, except as set forth in this Section 9, any amounts paid to you under this Section 9 be reduced by any other compensation earned by you.
10. You shall not make any statement that would libel, slander or disparage the Company, any member of the Company or its affiliates or any of their respective past or present officers, directors, managers, stockholders, employees or agents, provided that the foregoing shall not prohibit you from (i) making truthful statements in response to legal process, required governmental testimony or filings, or administrative or arbitral proceedings (including, without limitation, depositions in connection with such proceedings), (ii) making statements that you in good faith believe are necessary or appropriate to make in connection with performing your duties and obligations to the Company, (iii) engaging in concerted activity relative to the terms and conditions of your employment or (iv) in communications protected under the National Labor Relations Act, or from filing a charge or providing information to any governmental agency.
11. While we look forward to a long and profitable relationship, you will be an at-will employee of the Company as described in Section 8 of this letter. Any statements or representations to the contrary (and, indeed, any statements contradicting any provision in this letter) are, and should be regarded by you, as ineffective. Further, your participation in any benefit program or other Company program, if any, is not to be regarded as assuring you of continuing employment for any particular period of time.
12. It should also be understood that all offers of employment are conditioned on the Companys completion of a satisfactory background check. The Company reserves the right to perform background checks during the term of your employment, subject to compliance with applicable laws. You will be required to execute forms authorizing such a background check. In the event that the Company terminates your employment hereunder due to an unsatisfactory background check, notwithstanding anything herein to the contrary, you will be entitled to the Severance Pay, subject to the conditions set forth in Section 9.
13. Section 280G of the Internal Revenue Code
a. In the event that any payment, coverage or benefit provided in respect of your employment with the Company and its affiliates, whether under this letter or otherwise and whether before or after termination of your employment (the Payments), would be subject to the Excise Tax (as defined below), but the imposition of the Excise Tax could be avoided by approval of shareholders described in Section 280G(b)(5)(B) of the Internal Revenue Code of 1986, as amended (the Code), then you may cause the Company or any applicable affiliate of the Company to seek such approval, in which case the Company and any such affiliate will use their reasonable best efforts to cause such approval to be obtained and you will cooperate and execute such waivers as may be necessary so that such approval avoids imposition of any Excise Tax.
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b. In the event that any Payment could reasonably be expected to be subject to the Excise Tax and either (i) you do not elect to cause the Company or any applicable affiliate to seek approval of shareholders described in Section 280G(b)(5)(B) of the Code or (ii) such approval would not avoid the imposition of the Excise Tax, then the Company shall reduce (but not below zero) the aggregate present value of the Payments to the Reduced Amount (as defined below), if reducing the Payments will provide you with a greater net after-tax amount than would be the case if no such reduction was made. The Payments shall be reduced as described in the preceding sentence only if (a) the net amount of the Payments, as so reduced (and after subtracting the net amount of federal, state and local income and payroll taxes on the reduced Payments), is greater than or equal to (b) the net amount of the Payments without such reduction (but after subtracting the net amount of federal, state and local income and payroll taxes on the Payments and the amount of Excise Tax to which you would be subject with respect to the unreduced Payments). Any reduction shall be made in accordance with Section 409A of the Code.
c. For purposes of this Section 13, the term Reduced Amount shall be an amount expressed in present value that maximizes the aggregate present value of Payments without causing any Payments to be subject to the Excise Tax, determined in accordance with Section 280G(d)(4) of the Code, and the term Excise Tax means the excise tax imposed under Section 4999 of the Code, together with any interest or penalties imposed with respect to such excise tax.
d. All determinations to be made under this Section 13 shall be made by an independent registered public accounting firm or consulting firm selected by the Company and consented to by you immediately prior to a change in control, which shall provide its determinations and any supporting calculations both to the Company and you within 15 days prior to the change in control. All fees and expenses of the accounting or consulting firm in performing the determinations referred to in this Section 12 shall be borne solely by the Company.
14. This letter along with its Exhibits and the documents referred to herein constitute the entire agreement and understanding of the parties with respect to the subject matter of this letter, and supersede all prior understandings and agreements, including but not limited to employment agreements, severance agreements, and bonus agreements, whether oral or written, between or among you and the Company, Parent or any of their respective predecessors or affiliates with respect to the specific subject matter hereof. Waivers or modifications of this letter are valid only if in writing and duly executed by each of the parties hereto.
15. In the event of a conflict between the terms of this letter and the provisions of Exhibit A, the terms of this letter shall prevail.
16. Notwithstanding any other provision herein, the Company shall be entitled to withhold from any amounts otherwise payable hereunder any amounts required to be withheld in respect to federal, state or local taxes. The intent of the parties is that payments and benefits under this letter be exempt from, or comply with, Code Section 409A and the regulations and guidance promulgated thereunder (collectively Code Section 409A) and, accordingly, to the maximum extent permitted, this letter shall be interpreted to be in compliance therewith. In no event whatsoever shall the Company be liable for any additional tax, interest or penalty that may be imposed on you by Code Section 409A or damages for failing to comply with Code Section 409A. To the extent required by Code Section 409A, a termination of employment shall not be deemed to have occurred for purposes of any provision of this letter providing for the payment of any amounts or benefits upon or following a termination of employment unless such termination is
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also a separation from service within the meaning of Code Section 409A and, for purposes of any such provision of this letter, references to a termination, termination of employment or like terms shall mean separation from service. For purposes of Code Section 409A, your right to receive any installment payments pursuant to this letter shall be treated as a right to receive a series of separate and distinct payments. To the extent that reimbursements or other in-kind benefits under this letter constitute nonqualified deferred compensation for purposes of Code Section 409A, (a) all such expenses or other reimbursements hereunder shall be made on or prior to the last day of the taxable year following the taxable year in which such expenses were incurred by you, (b) any right to such reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit, and (c) no such reimbursement, expenses eligible for reimbursement, or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year. Notwithstanding anything in this letter to the contrary, if you are a specified employee for purposes of Code Section 409A and if payment of any amounts under this letter is required to be delayed for a period of six months after separation from service pursuant to Code Section 409A, payment of such amounts shall be delayed as required by Code Section 409A, and the accumulated amounts shall be paid in a lump sum payment within 15 days after the end of the six-month period, or if earlier, upon your death.
If you decide to accept the terms of this letter, and I hope you will, please signify your acceptance of these conditions of employment by signing and dating the enclosed copy of this letter and Exhibit A and returning them to me, not later than June 9, 2017. Should you have anything that you wish to discuss, please do not hesitate to contact me at.
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By signing this letter and Exhibit A attached hereto, you represent and warrant that you have had the opportunity to seek the advice of independent counsel before signing and have either done so, or have freely chosen not to do so, and either way, you sign this letter voluntarily.
Very truly yours, |
/s/ Rajeev Aggarwal |
Rajeev Aggarwal |
Chief Executive Officer |
I have read and understood this letter and Exhibit A attached and hereby acknowledge, accept and agree to the terms set forth therein.
/s/ Lawrence Samuelson |
Date signed: 6/9/17 |
Lawrence Samuelson
LIST OF EXHIBITS
Exhibit A: Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement 7
Exhibit B: Certain Definitions
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EXHIBIT A
CONFIDENTIALITY, INVENTION ASSIGNMENT, NON-SOLICIT, NON-COMPETE AND ARBITRATION AGREEMENT
As a condition of your employment and/or continued employment with Cvent, Inc. (as such companys name may change from time to time and such companys successors and assigns, the Company), and in exchange for the other and valuable consideration recited in Section 1 below, you and the Company agree to the following:
For purposes of this Agreement, references to the Group means the Company, and its affiliates (whether a parent, subsidiary, or sister entity to the Company) engaged in the same line of business or contemplated business as the Company.
1. |
CONSIDERATION FOR AGREEMENT. |
You understand that the Group is engaged in a continuous program of research, development, production and marketing in connection with its business and that it is critical for the Group to preserve and protect its Proprietary Information (as defined in Section 2 below), its rights in Inventions (as defined in Section 4 below) and in all related intellectual property rights. You acknowledge that, as a result of your employment with the Company and/or its predecessors, you have and/or may receive confidential information, trade secrets, and/or specialized training from the Group, each of which constitutes good and valuable consideration in support of your obligations made under this Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement (this Agreement). As additional consideration, you may also have the opportunity to develop valuable business relationships with employees, agents, suppliers, and customers of the Group and to use the Groups resources and goodwill in the marketplace to develop those relationships. Finally, by your signature below, you acknowledge that both the consideration outlined in your offer of employment from the Company and/or the letter to which this Agreement is attached and your continued employment with the Company (subject to Section 9), which the Company would not allow but for your execution of this Agreement, constitute additional consideration in support of your return promise to maintain the confidentiality of all specialized knowledge and confidential information as well as your promise to adhere to the other restrictions listed in this Agreement, including but not limited to those restrictions described in Section 7 of this Agreement.
2. |
PROPRIETARY INFORMATION. |
You understand that your employment creates a relationship of confidence and trust with respect to any information of a confidential or secret nature that may be disclosed to you or created by you that relates to the business of the Group or to the business of its customers, licensees, suppliers or any other party with whom the Group agrees to hold information of such party in confidence (the Proprietary Information).
You understand and agree that the term Proprietary Information includes but is not limited to information of all types contained in any medium (paper, electronic, in your memory, or otherwise stored or recorded), whether oral or written and regardless of whether it is marked as confidential,
proprietary or a trade secret. Proprietary Information includes, without limitation, the following information and materials, whether having existed, now existing or developed or created by you or on your behalf during your term of employment with the Company or its predecessor:
A) |
All information and materials relating to the existing software products and software in the various stages of research and development, including, but not limited to, source codes, object codes, design specifications, design notes, flow charts, graphics, graphical user interfaces, coding sheets, product plans, know-how, negative know how, test plans, business investment analysis, marketing and functional requirements, algorithms, product bugs and customer technical support cases which relate to the software; |
B) |
Internal business information, procedures and policies, including, but not limited to, licensing techniques, vendor names, other vendor information, business plans, financial information, budgets, forecasts, product margins, product costs, service and/or operation manuals and related documentation including drawings, and other such information, whether written or oral, which relates to the way the Group conducts its business; |
C) |
All legal rights, including but not limited to, trade secrets, pending patents, Inventions (as that term is defined in Section 4 below) and other discoveries, claims, litigation and/or arbitrations involving the Group, pending trademarks, copyrights, proposed advertising, public relations and promotional campaigns and like properties maintained in confidence; |
D) |
Any and all customer sales and marketing information, including but not limited to sales forecasts, marketing and sales promotion plans, product launch plans, sales call reports, competitive intelligence information, customer information, customer lists, customer needs and buying habits, sales and marketing studies and reports, internal price list, discount matrix, customer data, customer contracts, pricing structures, customer negotiations, customer relations materials, customer service materials, past customers, and the type, quantity and specifications of products purchased, leased or licensed by customers of the Group; |
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E) |
Any information obtained while working for the Group which gives the Group a competitive edge; |
F) |
Any other knowledge or information regarding the property, business, and affairs of the Group which the Group endeavors to keep confidential or which the Group believes to be confidential; and |
G) |
Any and all other trade secrets, as that term is defined under applicable laws. |
You understand and agree to treat and preserve Proprietary Information and materials as strictly confidential. Except as authorized by the Companys Chief Executive Officer (but in all cases preserving confidentiality by following Company policies and obtaining appropriate non-disclosure agreements), you further agree that, during your employment with the Company or thereafter, you will not directly or indirectly transmit or disclose Proprietary Information to any person, corporation, or other entity for any reason or purpose whatsoever, except in connection with the performance of your employment duties.
You understand and agree that the Proprietary Information is the exclusive property of the Group, and that, during your employment, you will use and disclose Proprietary Information only for the Groups benefit and in accordance with any restrictions placed on its use or disclosure by the Group. After termination of your employment for any reason, you will not use in any manner or disclose any Proprietary Information, except to the extent compelled by applicable law; provided that in the event you receive notice of any effort to compel disclosure of Proprietary Information for any reason, you will promptly and in advance of disclosure notify Company of such notice and fully cooperate with all lawful Company or Group efforts (through their counsel or otherwise) to resist or limit such disclosure.
Proprietary Information does not include information (i) that was or becomes generally available to you on a non-confidential basis, if the source of this information was not reasonably known to you to be bound by a duty of confidentiality, or (ii) that was or becomes generally available to the public, other than as a result of a disclosure by you, directly or indirectly or any other breach of this Agreement.
3. THIRD PARTY INFORMATION. You recognize that the Group has received and in the future will receive from third parties their confidential or proprietary information subject to a duly on the Groups part to maintain the confidentiality of such information and to use it only for certain limited purposes. You agree that you owe the Group and such third parties, during the term of your employment, and thereafter, a duty to hold all such confidential or proprietary information in the strictest confidence and not to disclose it to any person, firm or corporation (except as necessary in carrying out your work for the Group consistent with the Groups agreement with such third party) or to use it for the benefit of anyone other than for
the Group or such third party (consistent with the Companys agreement with such third party) without the express written authorization of the Chief Executive Officer of the Company. All rights and benefits afforded to the Company under this Agreement shall apply equally to the owner of the third party information with respect to the third party information, and such third party is an intended third party beneficiary of this Agreement, with respect to the third party information. You further agree to conform to the Companys privacy policies, as amended from time to time.
4. |
INVENTIONS. |
4.1 Prior Inventions. You have attached hereto as Schedule 1 a complete and accurate list describing all Inventions (as defined below) which were discovered, created, invented, developed or reduced to practice by you prior to the commencement of your employment by the Company and have not been legally assigned or licensed to the Company (collectively: Prior Inventions), which belong solely to you or belong to you jointly with others, which relates in any way to any of the Groups current, proposed or reasonably anticipated businesses, products or research or development and which are not assigned to the Group hereunder; or have initialed Schedule 1 to indicate you have no Prior Inventions to disclose.
If, in the course of your employment with the Company, you incorporate or cause to be incorporated into a Group product, service, process, file, system, application or program a Prior Invention owned by you or in which you have an interest, you hereby grant the Group member a non-exclusive, royalty-free, irrevocable, perpetual, worldwide, sublicensable and assignable license to make, have made, copy, modify, make derivative works of, use, offer to sell, sell or otherwise distribute such Prior Invention as part of or in connection with such product, process, file, system, application or program.
4.2 Disclosure of Inventions. You will promptly disclose in confidence to the Company all Inventions that you make or conceive or first reduce to practice or create, either alone or jointly with others, during the period of your employment, and for a period of three (3) months thereafter, whether or not in the course of your employment, and whether or not such Inventions are patentable, copyrightable or protectable as trade secrets. For purposes of this Agreement, Inventions means without limitation, formulas, algorithms, processes, techniques, concepts, designs, developments, technology, ideas, patentable and unpatentable inventions and discoveries, copyrights and works of authorship in any media now known or hereafter invented (including computer programs, source code, object code, hardware, firmware, software, mask work, applications, files, Internet site content, databases and compilations, documentation and related items) patents, trade and service marks, logos, trade dress, corporate names and other source indicators and the good will of any business symbolized thereby, trade secrets, know-how, confidential and proprietary information, documents, analyses, research and lists (including current and potential customer and user lists) and all applications and registrations and recordings, improvements and licenses related to any of the foregoing. You recognize that Inventions or Proprietary Information relating to your activities
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while working for the Company, and conceived, reduced to practice, created, derived, developed, or made by you, alone or with others, within three (3) months after termination of your employment may have been conceived, reduced to practice, created, derived, developed, or made, as applicable, in significant part while you were employed by the Company. Accordingly, you agree that such Inventions and Proprietary Information shall be presumed to have been conceived, reduced to practice, created, derived, developed, or made, as applicable, during your employment with the Company and are to be assigned to the Company pursuant to this Agreement and applicable law unless and until you have established the contrary by clear and convincing evidence.
4.3 Work for Hire, Assignment of Inventions. You acknowledge and agree that any copyrightable works prepared by you, either alone or jointly with others, within the scope of your employment are works made for hire under the Copyright Act and that the Company will be considered the author and owner of such copyrightable works. Any copyrightable works the Company or a Group member specially commissions from you while you are employed with the Company shall be deemed a work made for hire under the Copyright Act and if for any reason a work cannot be so designated as a work made for hire, you agree to and hereby assign to the Company all right, title and interest in and to said work(s) and the related copyright(s). You agree to and hereby grant the Company a non-exclusive, royalty-free, irrevocable, perpetual, worldwide, sublicensable and assignable license to make, have made, copy, modify, make derivative works of, use, publicly perform, display or otherwise distribute any copyrightable works you create during the time you are employed with the Company that for any reason do not qualify as a work made for hire, that were not specially commissioned by the Group, or both, but that relate in any way to the business of the Group. You agree that all Inventions that (i) are developed using equipment, supplies, facilities Proprietary Information, or trade secrets of the Group, (ii) result from work performed by you for the Group and/or on Company time, or (iii) relate to the Groups business or current or anticipated research and development (the Assigned Inventions), will be the sole and exclusive property of the Company and you agree to and hereby irrevocably assign the Assigned Inventions to the Company
4.4 Assignment of Other Rights. In addition to the foregoing assignment of Assigned Inventions to the Company, you hereby irrevocably transfer and assign to the Company: (i) all worldwide patents, patent applications, copyrights, mask works, trade secrets and other intellectual property rights in any Assigned Invention, and (ii) any and all Moral Rights (as defined below) that you may have in or with respect to any Assigned Inventions. You also hereby forever waive and agree never to assert any and all Moral Rights you may have in or with respect to any Assigned Inventions, even after termination of your work on behalf of the Company. Moral Rights mean any rights to claim authorship of any Assigned Inventions, to object to or prevent the modification of any Assigned Inventions, or to withdraw from circulation or control the
publication or distribution of any Assigned Inventions, and any similar right, existing under judicial or statutory law of any country in the world, or under any treaty, regardless of whether or not such right is denominated or generally referred to as a moral right.
4.5 Assistance. Whether during or after your employment, and without additional compensation, you agree to do any act and/or execute any document deemed necessary or desirable by the Company in furtherance of perfecting, prosecuting, recording, maintaining, enforcing and protecting the Groups right, title and interest in and to, any of the Assigned Inventions. In the event that the Company is unable for any reason to secure your signature to any document required to file, prosecute, register or memorialize the ownership and/or assignment of, or to enforce, any intellectual property, you hereby irrevocably designate and appoint the Companys duly authorized officers and agents as your agents and attorneys-in-fact to act for and on your behalf and stead to (i) execute, file, prosecute, register and/or memorialize the assignment and/or ownership of any Assigned Invention; (ii) to execute and file any documentation required for such enforcement and (iii) do all other lawfully permitted acts to further the filing, prosecution, registration, memorialization of assignment and/or ownership of, issuance of and enforcement of any Assigned Inventions, all with the same legal force and effect as if executed by you.
4.6 Applicability to Past Activities. To the extent you have been engaged to provide services by the Company or its predecessor for a period of time before the effective date of this Agreement (the Prior Engagement Period), you agree that if and to the extent that, during the Prior Engagement Period: (i) you received access to any information from or on behalf of the Company that would have been Proprietary Information if you had received access to such information during the period of your employment with the Company under this Agreement; or (ii) you conceived, created, authored, invented, developed or reduced to practice any item, including any intellectual property rights with respect thereto, that would have been an Invention if conceived, created, authored, invented, developed or reduced to practice during the period of your employment with the Company under this Agreement; then any such information shall be deemed Proprietary Information hereunder and any such item shall be deemed an Invention hereunder, and this Agreement shall apply to such information or item as if conceived, created, authored, invented, developed or reduced to practice under this Agreement.
5. NO BREACH OF PRIOR AGREEMENT. You represent that your performance of all the terms of this Agreement and your duties as an employee of the Company will not breach any invention assignment, proprietary information, confidentiality, noncompetition, nonsolicitation, noninterference, or similar agreement with any former employer or other party. You represent that you will not bring with you to the Company or use in the performance of your duties for the Company any documents or materials or intangibles of a former employer or third party that are not in the public domain or have not been legally transferred or licensed to the Company.
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6. DUTY OF LOYALTY. You understand that your employment with the Company requires your undivided attention and effort during normal business hours. While you are employed by the Company, you will not, without the Companys express prior written consent, (i) engage in any other business activity unless such activity is not competitive with the Group and does not materially interfere with your full-time employment hereunder (as determined in good faith by the good faith board of directors of the Company (after consultation with the Companys Chief Executive Officer), (ii) be engaged or interested, directly or indirectly, alone or with others, in any trade, business or occupation in competition with the Group, (iii) make preparations, alone or with others, to compete with the Group in the future, or (iv) appropriate for your own benefit business opportunities pertaining to the Groups business. The obligations imposed on you under the Section 6 are in addition to, and do not supplant, any similar obligations you may have to the Group under the common law or by statute.
7. DUTY OF NON INTERFERENCE. For purposes of this Section, solicit means any direct or indirect communication of any kind, regardless of who initiates it, that in any way invites, advises, encourages or requests any person to take or refrain from taking any action.
7.1 Non-Solicitation of Employees/Consultants. During your employment with the Group and for a period of two (2) years thereafter, you will not directly or indirectly hire, attempt to hire, recruit, offer employment, lure or entice away, or in any other manner persuade or otherwise solicit anyone who is then an employee or consultant of the Group (or who was an employee or consultant of the Group within the six months preceding the date of any such prohibited conduct) to resign from the Group or to apply for or accept employment with, or otherwise provide services to, you or any third party, for your own benefit or for the benefit of any other person or entity.
7.2 Non-Solicitation of Customers. During your employment with the Company and for a period of two years (2) year thereafter, you will not, whether as an owner, employee, member, director, officer, trustee, agent, contractor, consultant or otherwise, directly or indirectly (i) solicit or accept from any Customer or Potential Customer (as defined below) any business involving the sale or provision of Restricted Products (as defined in section 7.3); (ii) request or advise any Customer of the Group to curtail, cancel, or withdraw its business from the Group; or (iii) aid in any way any other entity in obtaining business from any Customer or Potential Customer involving the sale or provision of Restricted Products (as defined in section 7.3). Customer means any person or entity who is or was, during the last 24 months of your employment with the Company (including any period of employment with any predecessor of the Company) either (a) a customer of the Company or (b) a customer of any Group company and, (c) with whom you dealt on behalf of the Company or a Group member or their predecessor; (d) whose dealings with the Company or a Group member or their predecessor were coordinated or supervised by you; (e) about whom you obtained
Proprietary Information as a result of your association with the Company or a Group member or their predecessor; or (f) to whom you provided services on behalf of the Company or a Group member or their predecessor. Potential Customer means any person or entity (a) with whom you were directly involved in the solicitation or targeting of such potential customer or to whom you provided services on behalf of any Group company during the six months preceding the termination of your employment or (b) about whom you became privy to Proprietary Information as a result of your employment during the last six months of your employ.
7.3 Non-Competition. During your employment with the Company and for a period of two (2) years thereafter (the Restricted Period), you will not hold any position or role outside the Company or the Group, whether such position or role be an employee, officer, director, consultant, owner, manager, advisor, investor, or otherwise, through which you would, directly or indirectly, provide competing services with the business of the Group or that would enable you or another third party to unfairly compete with the business of the Group. By way of limitation to the foregoing, the following shall be considered competitive with the business of the Group: (i) the provision of services with respect to or the sale of Restricted Products, within 50 miles of any Group Customer, (ii) the provision of services with respect to or sale of Restricted Products within 50 miles of any Group Office or (iii) the research, development, manufacturing or distribution of Restricted Products that will be sold within 50 miles of any Group Customer or Group Office. For purposes of this section, Restricted Products means products or services (a) which are of the same or materially similar kind as the products or services (including but not limited to technical and product support, professional services, technical advice and other customer services) researched into, developed, manufactured, distributed, sold or supplied by the Group and (b) (1) with which you were directly connected during your employment with the Company or its predecessor or (2) about which you have received or developed Proprietary Information by reason of your employment with the Company or its predecessor or provision of services to any member of the Group. Group Customer means a customer with respect to which you provided services, had business dealings or about which you received or developed Proprietary Information. Group Office means an office of the Company or a Group company with respect to which you provided services, had business dealings or about which you received or developed Proprietary Information. Notwithstanding the foregoing, by providing prior notice to the Company you may accept employment or otherwise be engaged in or involved with a competitor of the Group that has multiple lines of business provided that, during the Restricted Period, you are employed by a business unit of such competitor that is not engaged or otherwise involved with Restricted Products OR you are providing services to the competitor that are unrelated to the services you provided to the Company and that will not confer an unfair business advantage to such competitor by virtue of the Proprietary Information in your possession. Nothing contained in this Section 7 shall
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prohibit you from owning of a passive investment interest of not more than 2.5% in a company with publicly traded equity securities, and whether on your own behalf or on behalf of others. You agree that the Restricted Period shall be extended by a period equal the length of any violation of this Section 7.3.
8. |
OBLIGATIONS UPON TERMINATION. |
8.1 Return of Company Property. At the time of leaving the employ of the Company, you will deliver to the Company (and will not keep in your possession or deliver to anyone else) (i) any and all documents and materials of any nature (including physical and electronic copies) pertaining to your work, including without limitation devices, records, data, notes, reports, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, equipment, other documents or property, or reproductions of any aforementioned items and (ii) all property belonging to the Group or any third party which provided property to you in connection with your employment such as computer, laptops, personal digital assistants, cell phones, MP3 players, electronic organizers and other devices, cards, car, keys, security devices or any other item belonging to the Group. Upon Company request, you will execute a document confirming your compliance with this provision and the terms of this Agreement.
8.2 Notification of New Employer. Before you accept employment or enter in to any consulting or other professional or business engagement with any other person or entity while any of Section 7 is in effect, you will provide such person or entity with written notice of the provisions of Section 7 and will deliver a copy of the notice to the Company. You hereby grant consent to notification by the Company to your new employer about your rights and obligations under this Agreement.
8.3 Withholding. To the extent allowed by law and permitted by Section 409A of the Internal Revenue Code, you agree to allow Company to deduct from your final paycheck(s) any amounts payable by you as a result of your employment, including but not limited to, any expense advances or business charges incurred by you on behalf of the Group, charges for property damaged or not returned when requested, and any other charges incurred by you payable to the Group. You agree to execute any authorization form as may be provided by Company to effectuate this provision.
9. |
AT WILL EMPLOYMENT. |
This Agreement does not constitute a contract of employment for any definite period of time. You acknowledge and agree that nothing in this Agreement modifies the at-will nature of your employment with Company, which permits either yourself or Company to terminate your employment at any time and without cause.
10. |
ARBITRATION. |
10.1 In the event of any controversy or dispute between you and the Company or between you and any affiliate or an agent of Company, including but not limited to directors, officers,
managers, other employees or members of the Group, who are being sued in any capacity, as to all or any part of this Agreement, any other agreement, any dispute or controversy whatsoever pertaining to or arising out of the relationship between you and the Company and/or the Group or the dissolution or termination of same, and/or the arbitrability thereof (collectively, Arbitrable Disputes as further defined below) shall, subject to Section 11.1 herein, be resolved exclusively by binding arbitration solely between yourself and the Company and/or person or entity described above, conducted in Washington, D.C. The arbitration shall be governed by the Federal Arbitration Act, 9 U.S.C. Section 1 et seq, as amended, and shall be administered in accordance with the procedures set forth in the Dispute Resolution Addendum appended hereto as Schedule 2 (the Addendum), all of which are incorporated into this Agreement by this reference.
10.2 Arbitrable Disputes shall include any and all disputes not specifically exempted from arbitration herein, including, but not limited to, any alleged violations of federal, state or local constitutions, statutes, laws, ordinances, regulations or common law, any claims of wrongful termination, unlawful discrimination, harassment or retaliation, including but not limited to Title VII of the 1964 Civil Rights Act, The Equal Pay Act, the Age Discrimination in Employment Act, the Americans with Disabilities Act, the Fair Labor Standards Act and similar state and local statutes, any claims of breach of contract or any implied covenant of good faith and fair dealing, any claims of adverse treatment in violation of public policy, and any disputes arising from, under or regarding this Agreement, including the formation, validity, interpretation, effect or breach of the Agreement. For avoidance of doubt, all disputes regarding the validity of this Agreement, the validity of the arbitration provisions of this Agreement, or whether any particular claim or matter is included within the scope of the arbitration provisions of this Agreement, are Arbitrable Disputes subject to arbitration as described herein.
Specifically excluded from Arbitrable Disputes are disputes or claims arising from or related to workers compensation and unemployment insurance, and any claims which are expressly excluded from binding arbitration by statute or public policy, or which are expressly required to be arbitrated under a different procedure.
10.3 While you are not required to do so before serving an arbitration demand under Section (g) of the Addendum, nothing in this Agreement shall prevent you from filing or maintaining an administrative charge or complaint with a government agency, including but not limited to, the Equal Employment Opportunity Commission, the Department of Labor and the National Labor Relations Board or any equivalent state or local agency. For the avoidance of doubt, if you choose not to file an administrative charge or complaint before commencing an arbitration in accordance with this Section 10 and the Addendum, your arbitration demand must be served, subject to Section 10.5, within the applicable time period for filing a charge with the relevant agency in order to be timely filed.
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10.4 This binding arbitration procedure shall supplant and replace claims in court (except as specified herein), and you expressly waive the right to a civil court action before a jury.
10.5 In accordance with Section (g) of the Addendum and to the extent permitted by applicable law, any arbitration relating to or arising from any Arbitrable Dispute shall be commenced by service of an arbitration demand on or before the earlier of: (i) the expiration of the limitations period provided by applicable law; or (ii) the one-year anniversary of the accrual of the aggrieved partys claim.
10.6 All Arbitrable Disputes under this Agreement must be brought in your individual capacity, and not as a plaintiff or class member in any purported class, representative or collective proceeding. You agree that the arbitrator is not empowered to consolidate claims of different individuals into one proceeding, or to hear an arbitration as a class arbitration. To the extent the arbitrator determines that this class/collective action waiver is invalid, for any reason, this entire Section 10 shall be null and void but only with regard to that particular proceeding in which the arbitrator invalidated this class/collective action waiver and this Section 10 shall remain in full force and effect with respect to any Arbitrable Disputes other than that covered by such class/collective action proceeding.
10.7 Notwithstanding the foregoing, the waiver of the jury trial right shall survive even in the event this Section 10 is deemed null and void.
11. |
GENERAL |
11.1 Injunctive Relief. Notwithstanding the arbitration provisions in Section 10 or anything else to the contrary in this Agreement, you and the Company understand and agree that the parties actions or potential actions concerning obligations under Sections 2, 3, 4, 6 or 7 of this Agreement may result in irreparable and continuing damage to the other party for which monetary damages will not be sufficient, and agree that both parties will be entitled to seek, in addition to its other rights and remedies hereunder or at law and both before or while an arbitration is pending between the parties under Section 10 of this Agreement, a temporary restraining order, preliminary injunction or similar injunctive relief from a court of competent jurisdiction in order to preserve the status quo or prevent irreparable injury pending the full and final resolution of the dispute through arbitration, without the necessity of showing any actual damages or that monetary damages would not afford an adequate remedy, and without the necessity of posting any bond or other security. The aforementioned injunctive relief shall be in addition to, not in lieu of, legal remedies, monetary damages or other available forms of relief through arbitration proceedings. This Section shall not be construed to limit the obligation for either party to pursue arbitration under Section 10 with respect to any Arbitrable Disputes.
11.2 Waiver of Breach. The failure of Company at any time, or from time to time, to require performance of any of your
obligations under this Agreement shall not be deemed a waiver of and shall in no manner affect Companys right to enforce any provision of this Agreement at a subsequent time. The waiver by Company of any rights arising out of any breach shall not be construed as a waiver of any rights arising out of any subsequent breach.
11.3 Non Disparagement, During and after your employment with the Company, except to the extent compelled or required by law, you agree you shall not disparage the Group, its customers and suppliers or their respective officers, directors, agents, servants, employees, attorneys, shareholders, successors or assigns or their respective products or services, in any manner (including but not limited to, verbally or via hard copy, websites, blogs, social media forums or any other medium); provided, however, that nothing in this Section shall prevent you from: engaging in concerted activity relative to the terms and conditions of your employment and in communications protected under the National Labor Relations Act, filing a charge or providing information to any governmental agency, or from providing information in response to a subpoena or other enforceable legal process or as otherwise required by law.
11.4 Applicable Law. This Agreement shall be governed by the laws of the State of Virginia, irrespective of its choice of law rules.
11.5 Entire Agreement. This Agreement along with Schedules 1 and 2 and the documents referred to herein constitute the entire agreement and understanding of the parties with respect to the subject matter of this Agreement, and supersede all prior understandings and agreements, whether oral or written, between or among the parties hereto with respect to the specific subject matter hereof. [Notwithstanding the foregoing, this Agreement does not supplant any rights the Group may have under the common law or by statute. Additionally, and notwithstanding the above language of this Section 11.6, you acknowledge and agree that the restrictive covenants you executed in favor of Cvent, Inc. (the Prior Agreement) shall remain in full force and effect; however, in the event of any inconsistency between the Prior Agreement and this Agreement, the terms and provisions of this Agreement and its attachments shall govern.] If any of Section 7 of this Agreement is deemed void, voidable, or otherwise invalid in legal proceedings, you agree that you shall comply with, and the Company may seek to enforce such provisions of the Prior Agreement against you. Headings are provided for convenience only and do not modify, broaden, define or restrict any provision. No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, will be effective unless in writing signed by the parties.
11.6 Survival. Any termination of this Agreement, regardless of how such termination may occur, shall not operate to terminate Sections 2, 3, 4, 5, 7, 8, 10 and 11 which shall survive any such termination and remain valid, enforceable and in full force and effect.
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[SIGNATURE PAGE FOLLOWS]
CVENT, INC. | ||||||||
By: |
/s/ Rajeev Aggarwal |
By: |
/s/ Lawrence Samuelson |
|||||
Name: Rajeev Aggarwal | Name of employee: Lawrence Samuelson | |||||||
Title: Chief Executive Officer | ||||||||
Date: 6/9/17 | Date: 6/9/17 |
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EXHIBIT B
Certain Definitions
Cause means any of the following: (i) a material failure by you to perform your responsibilities or duties to the Company under this letter or those other responsibilities or duties as requested from time to time by the Board, after demand for performance has been given by the Board that identifies how you have not performed your responsibilities or duties; (ii) your engagement in illegal or improper conduct or in gross misconduct; (iii) your commission or conviction of, or plea of guilty or nolo contendere to, a felony that the Board in good faith believe will not materially harm the standing and reputation of the Company; (iv) your commission or conviction of, or plea of guilty or nolo contendere to, any felony other than the type set forth in clause (iii), a crime involving moral turpitude or any other act or omission that the Company in good faith believes may harm the standing and reputation of the Company; (v) a material breach of your duty of loyalty to the Company or your material breach of the Companys written code of conduct and business ethics or Section 2 through 8 of the Confidentiality, Invention Assignment, Non-Solicit, Non-Compete and Arbitration Agreement, or any other agreement between you and the Company; (vi) dishonesty, fraud, gross negligence or repetitive negligence committed without regard to corrective direction in the course of discharge of your duties as an employee; or (vii) excessive and unreasonable absences from your duties for any reason (other than authorized vacation or sick leave) or as a result of your Disability (as defined below).
Disability means your inability to perform the essential functions of your job, with or without accommodation, for an extended period but not less than 60 business days in any consecutive 6 month period, as determined in the sole discretion of the Company.
Good Reason means that you voluntarily terminate your employment with the Company if there should occur, without your written consent:
(i) a material, adverse change in your duties or responsibilities with the Company, provided that
a change in title or a change in the person or office to which you report, shall not, by itself, constitute such a material, adverse change;
(ii) relocation of your principal place of employment by more than 35 miles;
(iii) a reduction in the Initial Base Salary by more than 10% in the aggregate during the term of your employment under this letter or a reduction in your base salary by less than 10% which is not applied to similarly ranked employees; and/or
(iv) the material breach by the Company of any offer letter or employment agreement between you and the Company.
provided, however, that in each case above, (i) you must first give the Company written notice of any of the foregoing within thirty (30) business days following the first occurrence of such event in a written explanation specifying the basis for your belief that you are entitled to terminate your employment for Good Reason, (ii) the Company must have thirty (30) days to cure such event and (iii) provided that the Company does not reasonably cure such event, you must actually resign your employment within ten (10) days following the cure period described in (ii).
Otherwise, any claim of such circumstances as Good Reason shall be deemed irrevocably waived by you.
All references to the Company in these definitions shall include parent, subsidiary, affiliate and successor entities of the Company.
Exhibit 10.19
PAPAY TOPCO, INC.
2017 STOCK OPTION PLAN
1. Purpose of Plan. This 2017 Stock Option Plan (the Plan) of Papay Topco, Inc., a Delaware corporation (the Company), is designed to provide incentives to such present and future employees, directors, officers, consultants or advisors of the Company or its subsidiaries (Participants), as may be selected in the sole discretion of the Committee, through the grant of Options by the Company to Participants. Only those Participants who are employees of the Company or its Subsidiaries shall be eligible to receive incentive stock options within the meaning of Section 422 of the Code. This Plan is a compensatory benefit plan within the meaning of Rule 701 of the Securities Act of 1933, as amended, and, unless and until the Companys Common Stock is publicly traded, the issuance of options to purchase shares of the Companys Common Stock pursuant to the Plan and the issuance of shares of Common Stock pursuant to such options are, to the extent permitted by applicable federal securities laws, intended to qualify for the exemption from registration under Rule 701 of the Securities Act.
2. Definitions. Certain terms used in this Plan have the meanings set forth below:
Affiliate means, when used with reference to a specific Person, any Person that directly or indirectly controls or is controlled by or is under common control with the specified Person. As used in this definition, control (including with its correlative meanings, controlled by and under common control with) shall mean either (i) possession, directly or indirectly, of power to direct or cause the direction of management or policies (whether through ownership of securities or partnership or other ownership interests, by contract or otherwise) or (ii) the direct or indirect ownership of more than fifty percent (50%) of the voting equity securities of such Person. With respect to any Person who is an individual, Affiliates shall also include any member of such individuals Family Group;
Board means the Companys board of directors.
Cause shall mean: (i) conduct tending to bring the Company or any of its Subsidiaries into public disgrace or disrepute or economic harm, (ii) material failure or inability to perform duties and/or obligations as reasonably directed by the Board or its designees, after demand for performance has been given by the Board or its designees that identifies how such Participant has not performed its duties and/or obligations, (iii) the commission or conviction of, or plea of guilty or nolo contendere to, a felony that the then-current Chief Executive Officer and the Board in good faith believe will not materially harm the standing and reputation of the Company, (iv) the commission or conviction of, or plea of guilty or nolo contendere to, a felony other than the type set forth in clause (iii) or any other act or omission involving dishonesty, disloyalty or fraud with respect to the Company or any of its Subsidiaries or any of their customers or suppliers if the act or omission was wrongful or deliberate, or any other crime involving moral turpitude, (v) gross negligence or misconduct with respect to the Company or any of its Subsidiaries, (vi) any other material breach of (A) any written agreement between the Company and such Participant evidencing the grant of any Option (B) the Companys written code of conduct and business ethics or (C) any other written agreement between such Participant and the Company or any Subsidiary of the Company or (vii) excessive and unreasonable
absences from such Participants duties for any reason (other than authorized vacation or sick leave) or as a result of such Participants inability to perform the essential duties, responsibilities and functions of its position with the Company as a result of any mental or physical disability or incapacity, which continues for 60 business days in any consecutive 6 month period.
Code means the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder, as the same may be amended from time to time.
Committee shall mean the committee of the Board which may be designated by the Board to administer the Plan. The Committee shall be composed of one or more directors as appointed from time to time to serve by the Board. In the absence of the appointment of any such Committee, any action permitted or required to be taken hereunder shall be deemed to refer to the Board.
Common Stock means the Companys Common Stock, par value $0.001 per share.
Company Group means the Company and its Subsidiaries.
Company Stock means, collectively, the Common Stock and any other class or series of shares of capital stock hereafter created by the Company.
Competitive Activity means, with respect to a Participant, during the term of such Participants employment with the Company or any of its Subsidiaries and during the two year period immediately following such Participants Termination Date, directly or indirectly, for himself or for any other Person, Participating in any Competitive Business or any business in which the Company is engaged or is planning to engage as of such Participants Termination Date; provided that the passive ownership by such Participant of not more than one percent (1%) of the outstanding shares of any class of capital stock of a corporation which is publicly traded on a national securities exchange will not be deemed to be a Competitive Activity, so long as such Participant has no active Participation in the business of such corporation.
Competitive Business means any business in the geographic area set forth in the non-competition provision in any written employment or severance agreement between the Company or any Subsidiary of the Company and such Participant (or, in the absence of the designation of any such geographic area in any such written agreement, any geographic area or country where the Company or any Subsidiary of the Company generates revenues) engaged in the Restricted Business set forth in the non-competition provision in any written employment or severance agreement between the Company or any Subsidiary of the Company and such Participant (or, in the absence of the designation of any such Restricted Business in any such written agreement, in the provision of services within the event management software and solutions industry related to any product, business, activity or service line of any person, entity or company that is in competition with any product, business, activity or service line of the Company).
Effective Date means May 26, 2017.
2
Fair Market Value means, with respect to a share of Common Stock or any other security, as of any date, (i) if such Common Stock or other security is not then traded on an established securities market, the fair market value as determined by the Board or the Committee based on the most recent independent, third-party valuation, performed by a nationally recognized valuation firm, pursuant to Internal Revenue Code Section 409A, without regard to discount for lack of liquidity or minority ownership, and (ii) if such Common Stock or other security is then traded on an established securities market, the closing price of such Common Stock or other security on the primary national securities exchange on which such Common Stock or security is traded, if any, on the trading day prior to the date as of which the Fair Market Value is to be determined.
Family Group means a Participants spouse and descendants (whether by birth or adoption) and any trust solely for the benefit of such Participant and/or such Participants spouse and/or such Participants descendants (by birth or adoption), parents or dependents, or any charitable trust the grantor of which is such Participant and/or a member of the Participants Family Group.
Good Reason shall have the meaning ascribed to such term in any written offer letter or employment or severance agreement between the Company or any Subsidiary of the Company and such Participant, or in the absence of any such written agreement, shall mean Participant resigns from employment with the Company or any Subsidiary of the Company as a result of one or more of the following reasons: (i) the Company reduces by more than 10% the amount of Participants base salary or (ii) the Company makes a material adverse change in Participants duties or responsibilities with the Company or any Subsidiary of the Company, provided that a change in title or a change in the person or office to which Participant reports, shall not, by itself, constitute such a material adverse change.
Independent Third-Party means any Person who, immediately prior to the contemplated transaction, does not own in excess of 10% of the Companys Common Stock on a fully-diluted basis (a 10% Owner), who is not controlling, controlled by or under common control with any such 10% Owner and who is not the spouse or descendant (by birth or adoption) of any such 10% Owner or a trust for the benefit of such 10% Owner and/or such other Persons.
Investors means Vista Equity Partners Fund VI, L.P., Vista Equity Partners Fund VI-A, L.P., and VEPF VI FAF, L.P. and any affiliate of any of the foregoing Persons that holds Common Stock, and Investor means any of the Investors individually.
IPO means an initial public offering and sale of the common stock of the Company or any Significant Subsidiary pursuant to an effective registration statement under the Securities Act.
Option means any option enabling the holder thereof to purchase any shares of the Companys Common Stock granted by the Committee pursuant to the provisions of this Plan. Options to be granted under this Plan may be incentive stock options within the meaning of Section 422 of the Code (Incentive Stock Options) or in such other form, consistent with this Plan, as the Committee may determine.
3
Option Shares means the shares of the Companys Common Stock acquired (or to be acquired) pursuant to the exercise of any Option.
Original Cost of each Option Share will be equal to the price paid therefor (in each case, as proportionally adjusted for all stock splits, stock dividends and other recapitalizations affecting such share of Common Stock subsequent to any such purchase).
Participate (and the correlative terms Participating and Participation) includes any direct or indirect ownership interest in any enterprise or participation in the management of such enterprise, whether as an officer, director, employee, partner, sole proprietor, agent, representative, independent contractor, consultant, executive, franchisor, franchisee, creditor, owner or otherwise.
Person means an individual, a partnership, a corporation, a limited liability company, an association, a joint share company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.
Public Sale means any sale of Option Shares to the public pursuant to an offering registered under the Securities Act or to the public through a broker, dealer or market maker pursuant to the provisions of Rule 144 adopted under the Securities Act or pursuant to the provisions of Rule 144(k) adopted under the Securities Act.
Requisite Holders means the holders of a majority of the Company Common Stock held by Investors.
Registration Rights Agreement means the Registration Rights Agreement by and among the Company and its stockholders signatory thereto, as the same may be amended, restated, supplemented or modified in accordance with its terms.
Sale of the Company means (i) any sale or transfer by the Company or any of the Significant Subsidiaries of all or substantially all (as defined under Delaware law) of their assets on a consolidated basis, or (ii) any consolidation, merger or reorganization of the Company or any of its Significant Subsidiaries with or into any other entity or entities as a result of which any Person or group other than the Investors obtains possession of voting power (under ordinary circumstances) to elect a majority of the surviving entitys board of directors or, in the case of a surviving entity which is not a corporation, governing body.
Securities Act means the Securities Act of 1933, as amended.
Significant Subsidiaries means the Company, Papay Midco, Inc., Papay Holdco, LLC and Cvent, Inc.
Solvent Reorganization means any solvent reorganization of the Company or any Subsidiary of the Company, including by merger, consolidation, recapitalization, transfer or sale of shares or assets, or contribution of assets and/or liabilities, or any liquidation, exchange of securities, conversion of entity, migration of entity, formation of new entity, or any other transaction or group of related transactions (in each case other than to or with a third party that is not a member of the Company Group or its Affiliates (which Affiliates may include an entity formed for the purpose of such Solvent Reorganization)), in which:
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(i) all holders of Option Shares are offered the same consideration in respect of such Option Shares;
(ii) the pro rata indirect economic interests of the holders of Option Shares in the business of the Company, relative to each other and all other holders, directly or indirectly, of equity securities in the Company Group (other than those held by entities within the Company Group), are preserved; and
(iii) the rights of the holders of Option Shares are preserved in all material respects (it being understood by way of illustration and not limitation that the relocation of a covenant or restriction from one instrument to another shall be deemed a preservation if the relocation is necessitated, by virtue of any law or regulations applicable to the Company Group following such Solvent Reorganization, as a result of any change in jurisdiction or form of entity in connection with the Solvent Reorganization; provided that such covenants and restrictions are retained in instruments that are, as nearly as practicable and to the extent consistent with business and transactional objectives, equivalent to the instruments in which such restrictions or covenants were contained prior to the Solvent Reorganization).
Stockholders Agreement means that certain Stockholders Agreement by and among the Company and its stockholders signatory thereto, as the same may be amended, restated, supplemented or modified in accordance with its terms.
Strategic Transaction means a transaction with or involving a strategic partner, i .e., a Person who, as determined by the Board, will benefit the Company as a result of experience, expertise, knowledge or relationships.
Subsidiary means any corporation or other entity of which the securities or other ownership interests having the voting power to elect a majority of the board of directors or other governing body are, at the time of determination, owned by the Company, directly or through one or more Subsidiaries.
Termination Date means the first date on which a Participant is no longer employed (or in the case of a Participant who was not an employee, the first date on which such Participant is no longer acting as a director or officer of, or consultant or advisor to, the Company or its Subsidiaries) by the Company or its Subsidiaries for any reason.
Termination Event means the first to occur of any (i) Sale of the Company, or (ii) sale or transfer to any third party of shares of the capital stock of the Company or any Significant Subsidiary by the holders thereof as a result of which any Person or group other than the Investors obtains possession of voting power (under ordinary circumstances) to elect a majority of the board of directors of the Company or the majority of the board of directors or any other governing body of the applicable Significant Subsidiary.
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3. Grant of Options. The Committee shall have the right and power to grant to any Participant such Options at any time prior to the termination of this Plan in such quantity, at such exercise price, which may be Fair Market Value or such other value as determined by the Committee and set forth in a written award agreement with respect to an Option, and on such other terms and subject to such conditions that are consistent with this Plan and established by the Committee. Options granted under this Plan shall be subject to such terms and conditions and evidenced by agreements as shall be determined from time to time by the Committee. Any Participant acquiring Common Stock pursuant to an Option shall be required to pay in full the exercise price related thereto, except as otherwise set forth in a written award agreement with respect to an Option.
4. Administration of the Plan. The Committee shall have the power and authority to prescribe, amend and rescind rules and procedures governing the administration of this Plan, including, but not limited to the full power and authority (i) to interpret the terms of this Plan, the terms of any Options granted under this Plan and the rules and procedures established by the Committee governing any such Options, (ii) to determine the rights of any person under this Plan or the meaning of requirements imposed by the terms of this Plan or any rule or procedure established by the Committee, (iii) to correct any defect or omission or reconcile any inconsistency in the Plan or in any Option granted hereunder, (iv) to determine whether any Options are subject to and/or comply with the requirements of Code Section 409A or the regulations thereunder and (v) to make all other determinations and take all other actions necessary or advisable for the implementation and administration of the Plan. Each action of the Committee shall be binding on all persons. Notwithstanding any provision to the contrary contained in this Plan or any separate written agreement between the Company and any Participant with respect to any Option pursuant to this Plan, any unvested Options that do not become vested immediately prior to, or in connection with, any Sale of the Company shall be forfeited and cancelled with concurrent effect upon the consummation of any such transaction, and no Participant nor any other Person shall have any further rights or obligations with respect to such forfeited Options.
It is the Companys intent that, except as otherwise specifically provided in a written award agreement with respect to an Option, the Options not be treated as a nonqualified deferred compensation plan that fails to meet the requirements of Section 409A(a)(2), (3) or (4) of the Code and that any ambiguities in construction be interpreted in order to effectuate such intent. Options under the Plan shall contain such terms as the Committee determines are appropriate to be exempt from, or comply with, the requirements of Section 409A of the Code. In the event that, after the issuance of an Option under the Plan, Section 409A of the Code or the regulations thereunder are amended, or the Internal Revenue Service or Treasury Department issues additional guidance interpreting Section 409A of the Code, the Committee may modify the terms of any such previously issued Option to the extent the Committee determines that such modification is necessary to comply with the requirements of Section 409A of the Code. In no event whatsoever shall the Company be liable for any additional tax, interest or penalty that may be imposed on any Participant by Code Section 409A or damages for failing to comply with Code Section 409A.
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5. Limitation on the Aggregate Number of Shares of Common Stock. The number of shares of Common Stock with respect to which Options may be granted under this Plan (and which may be issued upon the exercise or payment thereof) shall not exceed, in the aggregate, 101,123.00 shares of Common Stock (as such number is equitably adjusted pursuant to Section 8 hereof). If any Options expire unexercised or unpaid or are canceled, terminated or forfeited in any manner without the issuance of shares of Common Stock or payment thereunder, the shares with respect to which such Options were granted shall again be available under this Plan. Similarly, if any shares of Common Stock issued hereunder upon exercise of Options are repurchased hereunder, such shares shall again be available under this Plan for reissuance as Options.
6. Incentive Stock Options. Any of the Options to be granted hereunder may constitute Incentive Stock Options to the extent expressly designated as such by the Committee or the Board. All Incentive Stock Options (i) shall have an exercise price per share of Common Stock of not less than 100% of the Fair Market Value of such share on the date of grant, (ii) shall not be exercisable more than ten years after the date of grant, (iii) shall not be transferable other than by will or under the laws of descent and distribution and, during the lifetime of the Participant to whom such Incentive Stock Options were granted, may be exercised only by such Participant (or his guardian or legal representative) and (iv) shall be exercisable only during the Participants employment by the Company or a Subsidiary, provided, however, that the Committee may, in its discretion, provide at the time that an Incentive Stock Option is granted that such Incentive Stock Option may be exercised for a period ending no later than either (x) the termination of this Plan in the event of the Participants death while an employee of the Company or a Subsidiary or (y) the date which is three months after the Termination Date for any other reason. The Committees discretion to extend the period during which an Incentive Stock Option is exercisable shall only apply if and to the extent that (i) the Participant was entitled to exercise such option on the date of termination and (ii) such option would not have expired had the Participant continued to be employed by the Company or a Subsidiary. To the extent that the aggregate Fair Market Value of shares with respect to which Incentive Stock Options are exercisable for the first time by any individual during any calendar year exceeds $100,000, such options shall be treated as options which are not Incentive Stock Options.
7. Listing, Registration and Compliance with Laws and Regulations. Each Option shall be subject to the requirement that if at any time the Committee shall determine, in its discretion, that the listing, registration or qualification of the shares subject to the Option upon any securities exchange or under any federal, state or foreign securities or other law or regulation, or the consent or approval of any governmental regulatory body, is necessary or desirable as a condition to or in connection with the granting of such Option or the issue or purchase of shares thereunder, no such Option may be exercised or paid in shares of Common Stock in whole or in part unless such listing, registration, qualification, consent or approval (a Required Listing) shall have been effected or obtained, and the holder of each such Option will supply the Company with such certificates, representations and information as the Company shall request which are reasonably necessary or desirable in order for the Company to obtain such Required Listing, and shall otherwise cooperate with the Company in obtaining such Required Listing. In the case of officers and other persons subject to Section 16(b) of the Securities Exchange Act of 1934, as amended, the Committee may at any time impose any limitations upon the exercise of an Option which, in the Committees discretion, are necessary or desirable in order to comply with Section 16(b) and the rules and regulations thereunder. If the Company, as part of an offering of securities or otherwise, finds it desirable because of federal,
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state or foreign regulatory requirements to reduce the period during which any Option may be exercised, the Committee may, in its discretion and without the consent of the holders of any such Option, so reduce such period on not less than 15 days written notice to the holders thereof, provided, that the reduced exercise period shall not be less than 10 days following the effective date of such reduction.
8. Adjustment for Change in Common Stock. In the event any recapitalization, forward or reverse split, reorganization, merger, consolidation, spin-off, combination, repurchase, exchange or issuance of shares of Common Stock or other securities, any extraordinary cash dividend, any stock dividend, or other special and nonrecurring dividend or distribution (whether in the form of cash, securities or other property), liquidation, dissolution, or other similar transactions or events, affects the Common Stock, then the Committee shall make such equitable adjustment as is reasonably necessary in order to preserve the value of the Option and Option Shares and to prevent dilution or enlargement of the rights of the Participants under the Plan, including adjustment in (i) the number and type of shares authorized and available for grant under this Plan, (ii) the number and type of shares that may be delivered or deliverable in respect of outstanding Options, (iii) and the exercise price of outstanding Options.
9. Taxes. The Company shall be entitled, if necessary or desirable, to withhold (or secure payment from the Participant in lieu of withholding) the amount of any withholding or other tax due with respect to any amount payable and/or shares issuable under this Plan, and the Company may defer any such payment or issuance unless and until indemnified to its satisfaction.
10. Termination and Amendment. The Committee at any time may suspend or terminate this Plan and make such additions or amendments as it deems advisable under this Plan, except that it may not, without further approval by the Companys stockholders, (a) increase the maximum number of shares as to which Options may be granted under this Plan, except pursuant to Section 8 above or (b) extend the term of this Plan; provided that, subject to the other provisions hereof, the Committee may not change any of the terms of a written agreement with respect to an Option between the Company and the holder of such Option in a manner which would have a material adverse effect on the holder of such Option without the approval of the holder of such Option. No Options shall be granted hereunder after the tenth anniversary of the Effective Date; provided that, if the term of this Plan is otherwise extended, no Incentive Stock Options shall be granted hereunder after the tenth anniversary of the original Effective Date. The Company will not permit the amendment of the Stockholders Agreement in a manner material and adverse to the Management Stockholders without the prior written consent of the holders of at least a majority of the then outstanding Stockholder Shares (as defined in the Stockholders Agreement) held by Management Stockholders and the Company will not permit any such amendment or modification at a time when there are no Management Stockholders.
11. Participant Acknowledgments. In connection with the grant of any Option and/or the issuance of any Common Stock pursuant to this Plan, each Participant acknowledges and agrees, that as a condition to any such grant or issuance:
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(a) Except as otherwise required by law or the Stockholders Agreement, the Company will have no duty or obligation to disclose to any Participant, and no Participant will have any right to be advised of, any material information regarding the Company or its Subsidiaries at any time prior to, upon or in connection with the repurchase of any Option Shares upon the termination of such Participants employment with the Company or its Subsidiaries.
(b) Neither the grant of any Option, the issuance of any Common Stock nor any provision contained in this Plan or in any written agreement evidencing the grant of any Option or the issuance of any Common Stock shall entitle such Participant to remain in the employment of the Company or its Subsidiaries or affect the right of the Company to terminate any Participants employment at any time for any reason.
(c) Such Participant will have consulted, or will have had an opportunity to consult with, independent legal counsel regarding his or her rights and obligations under this Plan and any written agreement evidencing any grant of any Option and he or she fully understands the terms and conditions contained herein and therein.
(d) Prior to the purchase of any shares of Common Stock pursuant to this Plan or any written agreement evidencing the purchase of any shares of Common Stock, such Participant will deliver to the Company an executed consent from such Participants spouse (if any) in the form of Exhibit A attached hereto. If, at any time subsequent to the date such Participant purchases any shares of Common Stock and prior to the occurrence of a Termination Event, such Participant becomes legally married (whether in the first instance or to a different spouse), such Participant shall cause his or her spouse to execute and deliver to the Company a consent in the form of Exhibit A attached hereto. Such Participants failure to deliver the Company an executed consent in the form of Exhibit A at any time when such Participant would otherwise be required to deliver such consent shall constitute such Participants continuing representation and warranty that such Participant is not legally married as of such date. As a condition to the exercise of an Option, each Participant shall execute a joinder to the Stockholders Agreement pursuant to which such Participant shall become a party to the Stockholders Agreement and be entitled to the rights and benefits and subject to the duties and obligations of a Management Stockholder thereunder.
12. Repurchase Option.
(a) Repurchase Option. If a Participant is no longer employed (or in the case of a Participant who was not an employee, the date on which such Participant is no longer acting as a director or officer of, or consultant or advisor to, the Company or any of its Subsidiaries) by the Company or its Subsidiaries for any reason, the Option Shares (whether held by such Participant or one or more transferees of such Participant, other than the Company or any Investor) will be subject to repurchase by the Investors and the Company (each of the aforementioned solely at their option) pursuant to the terms and conditions set forth in this Section 12 (the Repurchase Option).
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(b) Repurchase Price. Following the Termination Date, the Investors and the Company may elect to repurchase all or any portion of the Option Shares at a price per share equal to (i) Original Cost, in the event of Participants termination for Cause (other than pursuant to clause (iii) of the definition thereof) or in the event Participant engages in a Competitive Activity prior to the repurchase date, or (ii) Fair Market Value (as of the date of repurchase), in the event of the Participants termination without Cause, with Cause (solely to the extent pursuant to clause (iii) of the definition thereof) or in the event Participant resigns with or without Good Reason; provided that if Participant engages in a Competitive Activity following the Termination Date, Participant shall pay to the Company the difference between the Fair Market Value (as of the date of repurchase) and the Original Cost, if any, of any Option Shares the Company has repurchased or subsequently does repurchase from Participant at Fair Market Value. In the event any rights pursuant to the Repurchase Option may arise, the Company will promptly notify the Investors thereof.
(c) Repurchase Procedures. Subject to Section 12(b), each Investor may elect to exercise the Repurchase Option to purchase up to its pro rata share (determined based upon the number of shares of Common Stock then held by each such Investor) by delivering written notice (the Initial Repurchase Notice) to the holder or holders of the Option Shares, the Company and the other Investors no later than 180 days after the later of (i) the Termination Date and (ii) the 181st day following the acquisition of the Option Shares subject to such repurchase. To the extent that any of the Investors do not elect to repurchase their full allotment of Option Shares no later than the fifth business day following delivery of the first Initial Repurchase Notice delivered by any Investor (and, immediately following the completion of such fifth business day, the Company will notify in writing each of the Investors if any of the Investors have not elected to purchase their full allotment of Option Shares), the other Investors shall be entitled to purchase all or any portion of the remaining Option Shares by providing notice (the Supplemental Repurchase Notice) to each of the parties receiving the Initial Repurchase Notice within 10 business days following the delivery of the first Initial Repurchase Notice delivered by any Investor; provided that if in the aggregate such Investors elect to purchase more than the remaining available Option Shares, such remaining available Option Shares purchased by each Investor will be reduced on a pro rata basis based upon the number of shares of Common Stock then held by each electing Investor. To the extent that, after giving effect to the reoffer pursuant to the immediately preceding sentence, any portion of the Option Shares are not being repurchased by the Investors, the Company may exercise the Repurchase Option for the remaining Option Shares by delivering written notice (a Company Repurchase Notice and together with the Initial Repurchase Notice and Supplemental Repurchase Notice, a Repurchase Notice) to the holder or holders of the applicable Option Shares within 10 business days of the expiration of the latest period during which the Investors were entitled to deliver Repurchase Notices. Each Repurchase Notice will set forth the number of Option Shares to be acquired from such holder(s), the aggregate consideration to be paid for such Option Shares and the time and place for the closing of the transaction. If any Option Shares are held by any transferees of a Participant, the Investors and the Company, as the case may be, will purchase the shares elected to be purchased from all such holder(s) of Option Shares, pro rata according to the number of Option Shares held by each such holder(s) at the time of delivery of such
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Repurchase Notice (determined as nearly as practicable to the nearest share). If Option Shares of different classes are to be purchased pursuant to the Repurchase Option and such Option Shares are held by any transferees of a Participant, the number of shares of each class of Option Shares to be purchased will be allocated among all such holders, pro rata according to the total number of Option Shares to be purchased from such holders.
(d) Closing. The closing of the transactions contemplated by this Section 12 will take place on the date designated in the applicable Repurchase Notice, which date will not be more than 90 days after the delivery of such notice. Each Investor will pay for the Option Shares to be purchased by it by, at its option, wire transfer of immediately available funds or delivery of a check payable to the holder of such Option Shares. The Company will pay for the Option Shares to be purchased by it by first offsetting amounts outstanding under any bona fide debts owing by such Participant to the Company or any of its Subsidiaries, now existing or hereinafter arising (irrespective as to whether such amounts are owing by the holder of such Option Shares), and will pay the remainder of the purchase price by, at its option, (i) wire transfer of immediately available funds, (ii) delivery of a check payable to the holder of such Option Shares, (iii) a subordinated promissory note payable in two equal annual installments commencing on the first anniversary of the closing of such purchase and bearing interest at a rate per annum equal to the highest rate of interest then paid by the Company on any bank debt or (iv) a combination of (i), (ii) and (iii), in the aggregate amount of the purchase price for such shares. Notwithstanding anything to the contrary contained herein, all repurchases of Option Shares by the Company will be subject to applicable restrictions contained in the corporation law of the Companys jurisdiction of incorporation and in the Companys and its Subsidiaries debt and equity financing agreements. If any such restrictions prohibit the repurchase of Option Shares hereunder which the Company is otherwise entitled to make, the Company may make such repurchases as soon as it is permitted to do so under such restrictions; provided that, the repurchase price per share shall be equal to Fair Market Value (or Original Cost, where applicable) at the time the Company is permitted to make such repurchase. The Investors and/or the Company, as the case may be, will receive customary representations and warranties from each seller regarding the sale of the Option Shares, including, but not limited to, representations that such seller has good and marketable title to the Option Shares to be transferred free and clear of all liens, claims and other encumbrances.
13. Restrictions on Transfer.
(a) Transfer of Options and Option Shares. No Participant may sell, transfer, assign, or otherwise directly or indirectly dispose of (a Transfer) or pledge or encumber any interest (legal or beneficial) in any Options or Option Shares, including to the Company or any of its Subsidiaries except Transfers pursuant to and in accordance with Sections 12, 13(b), 16 or 17 hereof (or as otherwise set forth in any written agreement with respect to the issuance of Options between the Company and such Participant), in each case pursuant to the terms and limitations set forth therein.
(b) Certain Permitted Transfers. The restrictions contained in Section 13(a) will not apply to (A) Transfers of Option Shares by a Participant (i) to its Affiliates, (ii)
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pursuant to Section 16, or (iii) pursuant to Section 17, or (B) Transfer of Options or Option Shares by any Participant who is a natural person for bona fide estate planning purposes to an irrevocable living trust formed under the laws of the United States or any political subdivision thereof solely for the benefit of such Participant and such Participants spouse and/or descendants or pursuant to the pursuant to applicable laws of descent or distribution or among a Participants Family Group; provided that the restrictions contained in this Plan will continue to apply to the Options and Option Shares after any Transfer pursuant to clause (A)(i) or (B) above and the transferees of such Options or Option Shares shall agree in writing, prior to and as a condition to such Transfer, to be bound by the provisions of this Plan. Upon the Transfer of Options or Option Shares pursuant to this Section 13(b), the transferor will deliver a written notice to the Company, which notice will disclose in reasonable detail the identity of such transferee(s) and shall include an original counterpart of the agreement of such transferee(s) to be bound by this Plan. Notwithstanding the foregoing, no Participant shall avoid the provisions of this Plan by making one or more transfers to one or more transferees permitted under clause (A)(i) above and then disposing of all or any portion of such Participants interest in such transferee. Any transferee of Options or Option Shares pursuant to a transfer in accordance with the provisions of this Section 13(b) is herein referred to as a Permitted Transferee.
(c) Termination of Restrictions. The rights and restrictions on the transfer of Option Shares set forth in this Section 13 will continue with respect to each Option Share until the earlier of (i) the consummation of an Approved Sale (as defined below) and (ii) the consummation of an IPO.
14. Additional Restrictions on Transfer.
(a) The certificates representing the Option Shares will bear the following legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE ACT), AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER, CERTAIN REPURCHASE OPTIONS AND CERTAIN OTHER AGREEMENTS SET FORTH IN THE ISSUERS 2017 STOCK OPTION PLAN AND A WRITTEN AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF SUCH SECURITIES, COPIES OF WHICH MAY BE OBTAINED BY THE HOLDER HEREOF AT THE ISSUERS PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE.
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(b) No holder of Option Shares may sell, transfer or dispose of any Option Shares (except pursuant to an effective registration statement under the Securities Act) without first, if requested by the Company, delivering to the Company an opinion of counsel reasonably acceptable in form and substance to the Company an opinion of (which counsel shall be reasonably acceptable to the Company) that registration under the Securities Act is not required in connection with such transfer.
15. Definition of Option Shares. For all purposes of this Plan, Option Shares will continue to be Option Shares in the hands of any holder other than a Participant (except for the Company, the Investors or purchasers pursuant to an offering registered under the Securities Act or purchasers pursuant to a Rule 144 transaction), and each such other holder of Option Shares will succeed to all rights and obligations attributable to such Participant as a holder of Option Shares hereunder and under any separate written agreement between the Company and such Participant. Option Shares will also include shares of the Companys capital stock issued with respect to Option Shares by way of a share split, share dividend or other recapitalization or otherwise in accordance with Section 8.
16. Sale of the Company.
(a) If the Requisite Holders approve (i) a sale of all or a majority of the Companys assets determined on a consolidated basis or a sale of a majority of the outstanding capital stock of the Company or any of its Significant Subsidiaries (whether by merger, recapitalization, consolidation, reorganization, combination or otherwise) to any Independent Third Party or group of Independent Third Parties or (ii) a Transfer of any shares by the Requisite Holders of Company Stock in connection with a Strategic Transaction (the transactions described in the foregoing clauses (i) and (ii), an Approved Sale), each holder of Option Shares shall vote for (to the extent entitled to vote) at a shareholders meeting or by written consent, and shall consent to and raise no objections against, the Approved Sale and the process by which such Approved Sale is arranged. If the Approved Sale is structured as (x) a merger or consolidation, each holder of Option Shares shall waive all dissenters rights, appraisal rights and similar rights in connection with such merger or consolidation, (y) a sale of assets, each holder of Option Shares shall vote in favor of the dissolution and liquidation of the Company following consummation of the Approved Sale if requested by such Requisite Holders or (z) a sale of Company Stock, each holder of Option Shares shall agree to sell and surrender such holders Option Shares at the same price, in the same proportion and on the same other terms and conditions, as applicable and as approved by such Requisite Holders. The Company and holders of Option Shares shall take all necessary or desirable actions reasonably requested in good faith by such Requisite Holders in connection with the consummation of the Approved Sale, and execute all agreements, documents and instruments in connection therewith, as reasonably requested in good faith by such Requisite Holders (including, without limitation, (i) with respect to the Company, providing potential purchasers with reasonable due diligence access to the books and records, personnel and facilities of the Company and its Subsidiaries (subject to customary confidentiality provisions) in order to facilitate an Approved Sale, (ii) with respect to holders of Option Shares who are also employees of the Company Group, entering into confidentiality, non-competition, non-solicitation and non-hire agreements requested by the proposed
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purchaser, which shall not be more restrictive that such employees existing agreements and (iii) with respect to all holders of Option Shares, entering into a sale contract, letters of transmittal and similar agreements and instruments as reasonably required in good faith by such Requisite Holders pursuant to which each holder shall: (A) severally (but not jointly) make such indemnities regarding the Company Group and their assets, liabilities and businesses (the Company Reps) as approved by such Requisite Holders and (B) solely on behalf of such holder, make such representations, warranties, covenants and indemnities concerning such holder and the Option Shares to be sold by such holder as may be set forth in any agreement approved by such Requisite Holders (the Holder Reps) and (C) join on a pro rata basis in any other obligations (including any escrows, expense holdbacks, covenants or leases) that the Requisite Holders are required to provide in connection with such transfer; provided that the allocable share of any holder of Option Shares for any amounts payable in connection with any claim by the purchaser for a breach of the Company Reps (any such amount payable, a Company Loss) shall be determined in accordance with Section 16(c), and if any holder of Option Shares pays for more than such holders allocable share of a Company Loss (such overpayment, the Excess Amount), then each other holder of Company Stock shall promptly contribute to such holder an amount equal to such other holders pro rata share of such Excess Amount as determined in accordance with Section 16(c)). Notwithstanding anything to the contrary contained herein, no holder of Option Shares shall be liable for Company Losses (x) in excess of such holders pro rata share of such Company Losses and (y) that are in the aggregate (taken together with aggregate indemnification losses with respect to the Holder Reps) greater than the amount of the proceeds actually received by the holder of such Option Shares in connection with such Approved Sale.
(b) The obligation of each holder of Option Shares with respect to an Approved Sale shall be subject to the satisfaction of the following conditions: (i) upon the consummation of the Approved Sale, each holder of Option Shares (in its capacity as such) shall have the right to receive with respect to each applicable class thereof the same form and amount of consideration; (ii) if any holders of a class of Company Stock are given an option as to the form and amount of consideration to be received, each holder of such class of Option Shares shall be given the same option (other than, in the case of clause (i) or this clause (ii), any consideration, option, right or benefit to be received by a holder on account of such individuals employment relationship with the Company Group (e.g., a stay bonus, noncompetition agreement, right to reinvest or roll over equity, etc.)); and (iii) each holder of Options shall be given an opportunity to either (A) exercise such rights prior to the consummation of the Approved Sale and participate in such sale as a holder of such class of Company Stock or (B) upon the consummation of the Approved Sale, receive in exchange for such rights consideration equal to the amount determined by multiplying (1) the same amount of consideration per share of a class of Company Stock received by holders of such class of Company Stock in connection with the Approved Sale less the exercise price per share of such class of Option Shares of such rights to acquire such class of Company Stock by (2) the number of shares of such class of Company Stock represented by such rights.
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(c) In the event an Approved Sale occurs (whether pursuant to this Section 16 or otherwise), each holder of Option Shares shall receive in exchange for such Option Shares held by such holder an amount (the Sale Proceeds Amount) equal to the amount that such holder would have received in respect of such holders Option Shares if the aggregate consideration (after satisfaction or assumption of all debts and liabilities) from such Approved Sale had been distributed by the Company in accordance with the order of priority as set forth in the Companys Certificate of Incorporation (and, if less than all of the Company Stock is included in such transaction, then the allocation of such aggregate net consideration shall be determined as if the stock included in such transaction was all of the Company Stock then outstanding, and for purposes of this Section 16(c), the terms of the Companys Certificate of Incorporation shall be interpreted consistent with this assumption). The allocable share of each holder of Option Shares of any Company Loss shall be an amount equal to the amount by which such holders Sale Proceeds Amount would have been reduced had the aggregate consideration from such Approved Sale been distributed by the Company in accordance with the immediately foregoing sentence after deducting from such aggregate consideration the aggregate amount of such Company Loss. The Company shall pay all transaction costs associated with any Approved Sale to the extent such costs are incurred for the benefit of all holders of Company Stock (as determined by the Board). To the extent such costs are not incurred by the Company prior to the distribution to the holders of Option Shares of proceeds from any Approved Sale or by the acquiring company, such costs shall be borne by each holder of Option Shares according to such holders pro rata share (based upon the number of Option Shares sold by such holder in relation to the number of Option Shares sold by all holders in such Approved Sale of such Option Shares and in such a manner that all costs and expenses are borne by the (and to the extent that such) Option Shares that would have shared therein had such costs and expenses been available to be distributed as additional purchase price proceeds in excess of what was actually available for distribution after taking into account such costs and expenses) of the costs of any Approved Sale. Expenses incurred by any holder of Option Shares on its own behalf (and not simultaneously for the benefit of all other holders of Company Stock as approved by the Board) shall not be considered expenses of the transaction and shall be the sole responsibility of such holder. Each holder of Option Shares shall take all necessary or desirable actions in connection with the distribution of the aggregate consideration from such Approved Sale as reasonably requested in good faith by the Requisite Holders.
(d) If the Company or the holders of Option Shares enter into any negotiation or transaction for which Rule 506 (or any similar rule then in effect) promulgated by the Securities and Exchange Commission may be available with respect to such negotiation or transaction (including, without limitation, a merger, consolidation or other reorganization), the holders of Option Shares shall at the request of the Company, appoint a purchaser representative (as such term is defined in Rule 501 (or any similar rule then in effect) promulgated by the Securities and Exchange Commission) reasonably acceptable to the Company. If any holder of Option Shares appoints a purchaser representative designated by the Company, the Company shall pay the fees of such purchaser representative. However, if any holder of Option Shares declines to appoint the purchaser representative designated by the Company, such holder shall appoint another purchaser representative (reasonably acceptable to the Company), and such holder shall be responsible for the fees of the purchaser representative so appointed.
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(e) If any holder of Option Shares does not, in connection with an Approved Sale, execute and/or deliver all transfer and other documents required to be executed and/or delivered, and take all other actions required to be taken, by such holder pursuant to this Section 16 in respect of all of the Option Shares held by such holder, such defaulting holder shall be deemed to have irrevocably appointed each and any member of the Board (or any officer appointed by the Board), acting individually, to be such holders agent and attorney-in-fact to execute and/or deliver all necessary transfer and other documents, and take all other necessary actions, on such holders behalf in connection with such Approved Sale.
(f) The provisions of Sections 16(b), (c) and (d) hereof will terminate on the first to occur of (i) the consummation of an IPO and (ii) the consummation of an Approved Sale (except as such provisions relate to any such Approved Sale).
(g) The provisions of this Section 16 shall not apply to any Option Share to the extent that the holder of such Option Share is party to the Stockholders Agreement and such Option Share is subject thereto.
17. Public Offering. If the Board and the Requisite Holders approve an IPO, the holders of Options and Option Shares will take all reasonably necessary or desirable actions in connection with the consummation of the IPO. If such IPO is an underwritten offering and the managing underwriters advise the Company in writing that in their opinion the capital stock structure will adversely affect the marketability of the offering, each holder of Options and Option Shares will consent to and vote for a recapitalization, reorganization and/or exchange of the Companys equity securities into securities that the managing underwriters, the Board and holders of a majority of the Common Stock then held by the Investors find acceptable and will take all necessary or desirable actions in connection with the consummation of the recapitalization, reorganization and/or exchange; provided that the resulting securities reflect and are consistent with the rights and preferences set forth in the Companys Certificate of Incorporation as in effect immediately prior to such IPO. Subject to the foregoing, if the IPO is of the capital stock of any of the Companys Subsidiaries, each holder of Options or Option Shares will exchange his, her or its Options or Option Shares, for equity securities of the applicable Subsidiary, as the case may be, and each such holder who is a director or employee of the Company or any of its Subsidiaries will enter into a registration rights agreement with the applicable issuer providing such holder with rights substantially similar to those afforded to an Executive under the Registration Rights Agreement. The provisions of this Section 17 and all references to the defined term IPO in this Plan will apply, mutatis mutandis, to (i) any initial public offering and sale of any common stock of any Subsidiary of the Company and the liquidation of the Company into any such Subsidiary in connection therewith and (ii) any Solvent Reorganization approved by the Board. In connection with any such public offering and sale of any common stock of any Subsidiary of the Company, the Company shall liquidate into such Subsidiary or take other appropriate action to distribute the securities of such Subsidiary.
18. Participation and Preemptive Rights. To enable a Participant to exercise an Option in order to participate in the rights that are afforded to Management Stockholders (as defined by the Stockholders Agreement) under Section 2(b) or Section 3 of the Stockholders Agreement, in the event that the Participant who holds vested Options would be eligible to receive notice pursuant to Section 2(b) or Section 3(c) of the Stockholders Agreement if such Participant were a Management Stockholder, such Participant shall be provided with notice pursuant to Section 2(b) or Section 3(c) of the Stockholders Agreement as though such Participant were a Management Stockholder thereunder.
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19. Transfers. Any transfer or attempted transfer of any Option Shares in violation of any provision of this Plan shall be void, and the Company shall not record such transfer on its books or treat any purported transferee of such Option Shares as the owner of such shares for any purpose. The preceding sentence and the provisions of Sections 13 and 14 notwithstanding, when a holder of Option Shares becomes a party to the Stockholders Agreement, any transfer or attempted transfer of any Option Shares shall be governed by the Stockholders Agreement. Except as otherwise permitted by the Committee, no Option may be sold, transferred, assigned, pledged or otherwise encumbered, except by will or the laws of descent and distribution, and an Option hall be exercisable during a Participants lifetime only by the Participant or the Participants legal guardian or representative.
20. Severability. Whenever possible, each provision of this Plan will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Plan is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or any other jurisdiction, but this Plan will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.
21. Remedies. Each of the Company, any Participant and the Investors will be entitled to enforce its rights under this Plan specifically, to recover damages and costs (including reasonable attorneys fees) caused by any breach of any provision of this Plan and to exercise all other rights existing in its favor. Each Participant and the Company acknowledges and agrees that money damages may not be an adequate remedy for any breach of the provisions of this Plan and that any party may in its sole discretion apply to any court of law or equity of competent jurisdiction (without posting any bond or deposit) for specific performance and/or other injunctive relief in order to enforce or prevent any violations of the provisions of this Plan.
22. Business Days. If any time period for giving notice or taking action hereunder expires on a day which is a Saturday, Sunday or holiday in the state in which the Companys chief executive office is located, the time period shall be automatically extended to the business day immediately following such Saturday, Sunday or holiday.
23. Governing Law. All issues concerning this Plan will be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice of law or conflict of law provision of rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the law of any jurisdiction other than the State of Delaware. Each of the Company and each Participant submits to the co-exclusive jurisdiction of the United States District Court and any Delaware state court sitting in Wilmington, Delaware over any lawsuit under this Plan and waives any objection based on venue or forum non conveniens with respect to any action instituted therein. Each of the Company and each Participant waives the necessity for personal service of any and all process upon it and consents that all such service of process may be made by registered or certified mail (return receipt
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requested), in each case directed to such party in accordance with the notice requirements set forth in this Plan, and service so made will be deemed to be completed on the date of actual receipt. Each of the Company and each Participant consents to service of process as aforesaid. Nothing in this Plan will prohibit personal service in lieu of the service by mail contemplated herein.
24. Notices. Any notice required or permitted under this Plan or any agreement executed and delivered in connection with this Plan shall be in writing and shall be either delivered by facsimile (which shall be effective upon receipt of confirmation of successful transmission), personally delivered, or mailed by first class mail, return receipt requested, to any Participant at the address indicated in the Companys records for such Person, and to the Company at the facsimile number and address below indicated:
Notices to the Company;
Papay Topco, Inc.
c/o Vista Equity Partners Management, LLC
Four Embarcadero Center 20th Floor
San Francisco, CA 94111
Fax: (415)765-6666
Attention: David A. Breach [***]
Maneet S. Saroya [***]
With a copy to:
Kirkland & Ellis LLP
555 California Street
San Francisco, CA 94104
Fax: (415)439-1500
Attention: Stuart E. Casillas, P.C. [***]
or such other facsimile number or address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party. Any notice under this Plan shall be deemed to have been given when so delivered or mailed.
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EXHIBIT A
SPOUSAL CONSENT
The undersigned spouse hereby acknowledges that I have read the following agreements to which my spouse is a party:
Papay Topco, Inc. 2017 Stock Option Plan
Stock Option Agreement
and that I understand their contents. I am aware that such agreements provide for the repurchase of certain of my spouses capital stock of Papay Topco, Inc. (the Company) under certain circumstances and impose other restrictions on such capital stock. I agree that my spouses interest in such capital stock is subject to the agreements referred to above and the other agreements referred to therein and any interest I may have in such capital stock shall be irrevocably bound by these agreements and the other agreements referred to therein and further that my community property interest (if any) shall be similarly bound by these agreements.
The undersigned spouse irrevocably constitutes and appoints (the Stockholder) as the undersigneds true and lawful attorney and proxy in the undersigneds name, place and stead to sign, make, execute, acknowledge, deliver, file and record all documents which may be required, and to manage, vote, act and make all decisions with respect to (whether necessary, incidental, convenient or otherwise), any and all capital stock of the Company in which the undersigned now has or hereafter acquires any interest and in any and all capital stock of the Company now or hereafter held of record by the Stockholder (including but not limited to, the right, without further signature, consent or knowledge of the undersigned spouse, to exercise or not to exercise any and all options under any appropriate agreements and to execute amendments and modifications of and to terminate the foregoing agreements and to dispose of any and all such capital stock and options), with all powers the undersigned spouse would possess if personally present, it being expressly understood and intended by the undersigned that the foregoing power of attorney and proxy is coupled with an interest; and this power of attorney is a durable power of attorney and will not be affected by disability, incapacity or death of the Stockholder, or dissolution of marriage and this proxy will not terminate without consent of the Stockholder and the Company.
Stockholder: | Spouse of Stockholder: | |||
Signature | Signature | |||
Printed Name | Printed Name | |||
Date | Date |
SUBSCRIBED AND SWORN to
before me this day
of _______________, 20___
My Commission Expires
Notary Public
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Exhibit 10.20
MASTER SERVICES AGREEMENT
This Master Services Agreement (this Agreement) is made and effective as of November 29, 2016 (the Effective Date) by and between Vista Consulting Group, LLC (VCG) and Cvent, Inc., a Delaware corporation (Service Recipient). Each of VCG and Service Recipient may be referred to herein as a Party or the Parties.
WHEREAS, VCG provides certain professional services, including services of the type desired to be obtained by Service Recipient;
WHEREAS, Service Recipient has elected to retain VCG to provide certain services; and, WHEREAS, VCG desires to provide such services;
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
1. DEFINITIONS
Confidential Information means any information that is treated as confidential by a Party, including trade secrets, technology, information pertaining to business operations and strategies, and information pertaining to customers, pricing, and marketing. Confidential Information shall not include information that: (a) is already known to the Receiving Party without restriction on use or disclosure prior to receipt of such information from the Disclosing Party; (b) is or becomes generally known by the public other than by breach of this Agreement by, or other wrongful act of, the Receiving Party; (c) is developed by the Receiving Party independently of, and without reference to, any Confidential Information of the Disclosing Party; or (d) is received by the Receiving Party from a third party who is not under any obligation to the Disclosing Party to maintain the confidentiality of such information
Deliverables means all documents, work product and other materials that are delivered to Service Recipient hereunder or prepared by or on behalf of VCG in the course of performing the Services, including any items identified as such in any Statement of Work.
Disclosing Party means a Party that has disclosed information treated as confidential by such Party.
Equipment means any equipment, systems, cabling or facilities provided by Service Recipient and used directly or indirectly in the provision of the Services.
Intellectual Property Rights means all (a) patents, patent disclosures and inventions (whether patentable or not), (b) trademarks, service marks, trade dress, trade names, logos, corporate names and domain names, together with all of the goodwill associated therewith, (c) copyrights and copyrightable works (including computer programs), mask works, and rights in data and databases, (d) trade secrets, know-how and other confidential information, and (e) all other intellectual property rights, in each case whether registered or unregistered and including all applications for, and renewals or extensions of, such rights, and all similar or equivalent rights or forms of protection in any part of the world.
Law means any statute, law, ordinance, regulation, rule, code, order, constitution, treaty, common law, judgment, decree, other requirement or rule of law of any federal, state, local or foreign government or political subdivision thereof, or any arbitrator, court or tribunal of competent jurisdiction.
Pre-Existing Materials means the pre-existing materials provided by or used by VCG in connection with performing the Services.
Receiving Party means a Party that has received information treated as confidential by the other Party.
Services means either (i) those services described on any Statement of Work or (ii) general consulting services that are not specified in any Statement of Work.
Statement of Work means each statement of work describing services to be provided by VCG to Service Recipient pursuant to this Agreement in a form to be agreed by the Parties and as further described in this Agreement. For the avoidance of doubt, a Statement of Work may be denominated in any form that makes sense to the Parties, including Statement of Work, Engagement Notice, Services Description or the like, and is not required to be entitled Statement of Work to be effective under this Agreement.
VCG Personnel means all employees and third party contractors engaged by VCG to provide the Services from time to time.
2. SERVICES
2.1 Provision of Services. VCG shall provide the Services to Service Recipient (and any affiliated entities of Service Recipient that are intended beneficiaries of the Services pursuant to Section 2.2(f) below) as described in more detail in each Statement of Work in accordance with the terms and conditions of this Agreement.
2.2 Statements of Work. Each Statement of Work shall include the following information, if applicable:
(a) a detailed description of the Services to be performed pursuant to the Statement of Work;
(b) the date upon which the Services will commence and the term of such Statement of Work;
(c) the estimated fees to be paid to VCG under the Statement of Work;
(d) Services implementation plan and timetable;
(e) any criteria for completion of the Services;
(f) any affiliated entities of Service Recipient that are intended beneficiaries of the Services; and
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(g) any other terms and conditions agreed upon by the parties in connection with the Services to be performed pursuant to such Statement of Work.
2.3 Change Orders. If either Party wishes to change the scope or performance of the Services, it shall submit details of the requested change to the other Party. VCG shall, within a reasonable time after such request, provide an estimate to Service Recipient of:
(a) the likely time required to implement the change;
(b) any necessary variations to the estimated fees and other charges for the Services arising from the change;
(c) the likely effect of the change on the Services; and
(d) any other impact the change might have on the performance of this Agreement.
Promptly after receipt of the estimate, the Parties shall negotiate and agree on the terms of such change (a Change Order).
3. VCG OBLIGATIONS
3.1 Personnel. VCG shall have the right to select all VCG Personnel in its sole discretion. VCG shall select a primary and secondary contact out of the VCG Personnel for the purpose of ensuring accurate and timely communication between VCG and the Service Recipient regarding the Services, and shall provide contact information for such individuals to Service Recipient; provided, however, that VCG shall have the right to substitute different individuals upon written notice to Service Recipient. VCG shall use commercially reasonable efforts to ensure that all VCG Personnel comply with all rules, regulations and policies of Service Recipient that are communicated to VCG in writing, including security procedures concerning systems and data and remote access thereto, building security procedures.
3.2 Compensation and Benefits. VCG shall be responsible for all VCG Personnel and for the payment of their compensation, including, if applicable, withholding of income taxes, and the payment and withholding of social security and other payroll taxes, unemployment insurance, workers compensation insurance payments and disability benefits.
4. SERVICE RECIPIENT OBLIGATIONS.
4.1 Cooperation. Service Recipient shall cooperate with VCG in all matters relating to the Services, respond promptly to any VCG request to provide direction, information, approvals, authorizations or decisions that are reasonably necessary for VCG to perform Services in accordance with the requirements of this Agreement and appoint a Service Recipient employee to serve as the primary contact with respect to this Agreement and who will have the authority to act on behalf of Service Recipient with respect to matters pertaining to this Agreement.
4.2 Facility Access and Equipment. Service Recipient shall provide access to its premises, and such offices and other facilities, as may be reasonably requested by VCG for the purpose of providing the Services, and ensure that all Equipment is in good working order and suitable for the purposes for which it is use, and conforms to all applicable industry standards.
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4.3 Licenses. Service Recipient shall obtain and maintain all necessary licenses and consents and comply with all applicable Law in relation to the Services and the use of the Service Recipient Equipment, in all cases before the date on which the Services are to start.
4.4 Excusable Delays. If VCGs performance of its obligations under this Agreement is prevented or delayed by any act or omission of Service Recipient or its agents, subcontractors, consultants or employees, VCG shall not be deemed in breach of its obligations under this Agreement or otherwise liable for any costs, charges or losses sustained or incurred by Service Recipient, in each case, to the extent arising directly or indirectly from such prevention or delay.
5. FEES AND PAYMENTS.
5.1 Fees Generally. In consideration of the provision of the Services by VCG and the rights granted to Service Recipient under this Agreement, Service Recipient shall pay the fees set forth in the applicable Statement of Work.
5.2 Time and Materials. Where the Services are provided on a time and materials basis: the fees payable for the Services shall be calculated in accordance with VCGs daily or hourly fee rates for the VCG Personnel; and VCG shall issue invoices to Service Recipient monthly in arrears for its fees for time for the immediately preceding month, calculated as provided in this Section 5.2, together with a detailed breakdown of any expenses for such month incurred in accordance with Section 5.5.
5.3 Fixed Fees. Where Services are provided for a fixed price, the total fees for the Services shall be the amount set out in the applicable Statement of Work. The total price shall be paid to VCG in installments, as set out in the Statement of Work.
5.4 Subscription Fees. Where Services are provided under a subscription model, the recurring rate for such Services shall be set out in the applicable Statement of Work, and invoices shall be issued monthly, or on such other period as set forth in the applicable Statement of Work.
5.5 Expenses. Service Recipient agrees to reimburse VCG for all reasonable expenses (including expenses related to training programs, meetings and other events (to the extent that such programs, meetings or events are attended by Service Recipient personnel), certain entertainment expenses (to the extent that such expenses are attributable to the Service Recipient), travel expenses (which include expenses for chartered or first class travel), and expenses relating to recruiting, relocation and background checks for Service Recipient positions) incurred by VCG in connection with the performance of the Services or any fees, servicing payments (without regard to any rebates or other benefits obtained by VCG) related to group purchasing arrangements to the extent that the same benefit Service Recipient.
5.6 Rate Increases. For Services provided on a time and materials basis, VCG may increase its standard fee rates specified in the applicable Statement of Work upon written notice to Service Recipient.
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5.7 Invoices. VCG shall issue invoices to Service Recipient only in accordance with the terms of this Section, and Service Recipient shall pay all properly invoiced amounts due to VCG within 30 days after Service Recipients receipt of such invoice. All payments hereunder shall be in US dollars and made by check or wire transfer.
5.8 Taxes. Service Recipient shall be responsible for all sales, use and excise taxes, and any other similar taxes, duties and charges of any kind imposed by any federal, state or local governmental entity on any amounts payable by Service Recipient hereunder; provided, that, in no event shall Service Recipient pay or be responsible for any taxes imposed on, or with respect to, VCGs income, revenues, gross receipts, personnel or real or personal property or other assets.
6. CONFIDENTIALITY.
6.1 Confidentiality Generally. The Receiving Party agrees (a) not to disclose or otherwise make available Confidential Information of the Disclosing Party to any third party without the prior written consent of the Disclosing Party; provided, however, that the Receiving Party may disclose the Confidential Information of the Disclosing Party to its officers, employees, consultants and legal advisors who have a need to know, who have been apprised of this restriction and who are themselves bound by nondisclosure obligations at least as restrictive as those set forth in this Section 6; (b) to use the Confidential Information of the Disclosing Party only for the purposes of performing its obligations under the Agreement or, in the case of Customer, to make use of the Services and Deliverables; and (c) to promptly notify the Disclosing Party in the event it becomes aware of any loss or disclosure of any of the Confidential Information of Disclosing Party.
6.2 Permitted Disclosures. If the Receiving Party becomes legally compelled to disclose any Confidential Information, the Receiving Party shall provide prompt written notice of such requirement so that the Disclosing Party may seek, at its sole cost and expense, a protective order or other remedy; and reasonable assistance, at the Disclosing Partys sole cost and expense, in opposing such disclosure or seeking a protective order or other limitations on disclosure. If, after providing such notice and assistance as required herein, the Receiving Party remains required by Law to disclose any Confidential Information, the Receiving Party shall disclose no more than that portion of the Confidential Information which, on the advice of the Receiving Partys legal counsel, the Receiving Party is legally required to disclose and, upon the Disclosing Partys request, shall use commercially reasonable efforts to obtain assurances from the applicable court or agency that such Confidential Information will be afforded confidential treatment.
7. INTELLECTUAL PROPERTY AND OWNERSHIP.
7.1 Service Recipient IP. Except as set forth in Section 7.2, Service Recipient is, and shall be, the sole and exclusive owner of all right, title and interest in and to the Deliverables, including all Intellectual Property Rights therein. VCG agrees that with respect to any Deliverables that may qualify as work made for hire, such Deliverables are hereby deemed a work made for hire for Service Recipient. To the extent that any of the Deliverables do not constitute a work made for hire, VCG hereby irrevocably assigns, and shall cause the VCG Personnel to irrevocably assign to Service Recipient, in each case without additional consideration, all right, title and interest throughout the world in and to the Deliverables, including all Intellectual Property Rights
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therein. Upon the reasonable request of Service Recipient, VCG shall, and shall cause the VCG Personnel to, promptly take such further actions, including execution and delivery of all appropriate instruments of conveyance, as may be necessary to assist Service Recipient to prosecute, register, perfect or record its rights in or to any Deliverables.
7.2 VCG IP. VCG and its licensors are, and shall remain, the sole and exclusive owners of all right, title and interest in and to the Pre-Existing Materials, including all Intellectual Property Rights therein. VCG hereby grants Service Recipient a limited, irrevocable, perpetual, fully paid-up, royalty-free, non-transferable, non-sublicenseable, worldwide license to any Pre-Existing Materials to the extent incorporated in, combined with or otherwise necessary for the use of the Deliverables for any and all purposes/solely to the extent reasonably required in connection with Service Recipients receipt or use of the Services and Deliverables. All other rights in and to the Pre-Existing Materials are expressly reserved by VCG.
8. REPRESENTATIONS AND WARRANTIES.
8.1 Mutual Representations. Each Party represents and warrants to the other Party that:
(a) it is duly organized, validly existing and in good standing as a corporation or other entity as represented herein under the laws and regulations of its jurisdiction of incorporation, organization or chartering;
(b) it has the full right, power and authority to enter into this Agreement, to grant the rights and licenses granted hereunder and to perform its obligations hereunder;
(c) the execution of this Agreement by its representative whose signature is set forth at the end hereof has been duly authorized by all necessary corporate action of the Party; and,
(d) when executed and delivered by such Party, this Agreement will constitute the legal, valid and binding obligation of such party, enforceable against such Party in accordance with its terms.
8.2 DISCLAIMER OF REPRESENTATIONS AND WARRANTIES. EXCEPT FOR THE EXPRESS WARRANTIES IN THIS SECTION 8, (A) EACH PARTY HEREBY DISCLAIMS ALL WARRANTIES, EITHER EXPRESS, IMPLIED, STATUTORY, OR OTHERWISE UNDER THIS AGREEMENT, AND (B) VCG SPECIFICALLY DISCLAIMS ALL IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, TITLE AND NON-INFRINGEMENT.
9. LIMITATION OF LIABILITY.
9.1 GENERAL LIMITATION. EXCEPT AS OTHERWISE PROVIDED IN SECTION 9.3, IN NO EVENT WILL EITHER PARTY BE LIABLE TO THE OTHER OR TO ANY THIRD PARTY FOR ANY LOSS OF USE, REVENUE OR PROFIT OR LOSS OF DATA OR FOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT, EXEMPLARY, SPECIAL OR PUNITIVE DAMAGES WHETHER ARISING OUT OF BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, REGARDLESS OF WHETHER SUCH DAMAGE WAS FORESEEABLE AND WHETHER OR NOT SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
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9.2 CAP ON DAMAGES. EXCEPT AS OTHERWISE PROVIDED IN SECTION 9.3, IN NO EVENT WILL EITHER PARTYS LIABILITY ARISING OUT OF OR RELATED TO THIS AGREEMENT, WHETHER ARISING OUT OF OR RELATED TO BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, EXCEED THE AGGREGATE AMOUNTS PAID OR PAYABLE TO VCG IN THE ANNUAL PERIOD PRECEDING THE EVENT GIVING RISE TO THE CLAIM.
9.3 Exclusions. The exclusions and limitations in Section 9.1 and Section 9.2 shall not apply to damages or other liabilities arising out of or relating to a partys failure to comply with its confidentiality obligations under Section 6.
10. TERM AND TERMINATION.
10.1 Term. This Agreement shall begin on the Effective Date and extend in time in perpetuity unless no active Statement of Work has been in effect for 60 days, in which case this Agreement shall expire.
10.2 Certain Termination Rights. Either Party may terminate this Agreement, effective upon written notice to the other Party (the Defaulting Party), if the Defaulting Party:
(a) breaches this Agreement, and such breach is incapable of cure, or with respect to a breach capable of cure, the Defaulting Party does not cure such breach within 30 days after receipt of written notice of such breach;
(b) (i) becomes insolvent or admits its inability to pay its debts generally as they become due; (ii) becomes subject, voluntarily or involuntarily, to any proceeding under any domestic or foreign bankruptcy or insolvency law, which is not fully stayed within 7 business days or is not dismissed or vacated within 45 days after filing; (iii) is dissolved or liquidated or takes any corporate action for such purpose; (iv) makes a general assignment for the benefit of creditors; or (v) has a receiver, trustee, custodian or similar agent appointed by order of any court of competent jurisdiction to take charge of or sell any material portion of its property or business.
10.3 Effect of Termination. Upon expiration or termination of this Agreement for any reason each Party shall (i) return to the other Party all documents and tangible materials (and any copies) containing, reflecting, incorporating or based on the other partys Confidential Information, (ii) permanently erase all of the other Partys Confidential Information from its computer systems and (iii) certify in writing to the other Party that it has complied with the requirements of this Section 10.3. The rights and obligations of the parties set forth in this Section 10.3 and Section 1, Section 6, Section 7, Section 9, and Section 11, and any right or obligation of the parties in this Agreement which, by its nature, should survive termination or expiration of this Agreement, will survive any such termination or expiration of this Agreement
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11. MISCELLANEOUS.
11.1 Non-Solicitation. During the Term of this Agreement and for a period of twelve (12) months thereafter, Service Recipient shall not, directly or indirectly, in any manner solicit or induce for employment any person who performed any work under this Agreement who is then in the employment of VCG. A general advertisement or notice of a job listing or opening or other similar general publication of a job search or availability to fill employment positions, including on the internet, shall not be construed as a solicitation or inducement for the purposes of this Section 11.1, and the hiring of any such employees or independent contractor who freely responds thereto shall not be a breach of this Section 11.1. If Service Recipient breaches Section 11.1, Service Recipient shall, on demand, pay to VCG a sum equal to one years basic salary or the annual fee that was payable by VCG to that employee, worker or independent contractor plus the recruitment costs incurred by VCG in replacing such person.
11.2 No Exclusivity. VCG retains the right to provide services of a type similar to the Services to any third party at any time.
11.3 Force Majeure. No Party shall be liable or responsible to the other Party, nor be deemed to have defaulted under or breached this Agreement, for any failure or delay in fulfilling or performing any term of this Agreement (except for any obligations to make payments to the other party hereunder), when and to the extent such failure or delay is caused by or results from acts beyond the affected Partys reasonable control, including (a) acts of God; (b) flood, fire or explosion; (c) war, invasion, riot or other civil unrest; (d) actions, embargoes or blockades in effect on or after the date of this Agreement; (e) national or regional emergency; (f) strikes, labor stoppages or slowdowns or other industrial disturbances; (g) compliance with any law or governmental order, rule, regulation or direction, or any action taken by a governmental or public authority, including imposing an embargo, export or import restriction, quota or other restriction or prohibition, or failing to grant a necessary license or consent; (h) shortage of adequate power or telecommunications or transportation facilities.
11.4 Independent Contractors. The relationship between the Parties is that of independent contractors. Nothing contained in this Agreement shall be construed as creating any agency, partnership, joint venture or other form of joint enterprise, employment or fiduciary relationship between the Parties, and neither arty shall have authority to contract for or bind the other party in any manner whatsoever.
11.5 No Press Releases. Neither Party shall issue or release any announcement, statement, press release or other publicity or marketing materials relating to this Agreement, or otherwise use the other Partys trademarks, service marks, trade names, logos, symbols or brand names, in each case, without the prior written consent of the other Party.
11.6 Notices. All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and shall be deemed to have been given (a) when delivered by hand (with written confirmation of receipt); (b) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by facsimile (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next business day if sent after normal business hours of the recipient or (d) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications must be sent to the respective Party at the addresses indicated below (or at such other address for a Party as shall be specified in a notice given in accordance with this Section 11.6).
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If to VCG:
If to Service Recipient:
11.7 Construction of Agreement. For purposes of this Agreement, (a) the words include, includes and including shall be deemed to be followed by the words without limitation; (b) the word or is not exclusive; and (c) the words herein, hereof, hereby, hereto and hereunder refer to this Agreement as a whole. Unless the context otherwise requires, references herein: (x) to Sections and Statements of Work refer to the Sections of, and Statements of Work attached to this Agreement; (y) to an agreement, instrument or other document means such agreement, instrument or other document as amended, supplemented and modified from time to time to the extent permitted by the provisions thereof and (z) to a statute means such statute as amended from time to time and includes any successor legislation thereto and any regulations promulgated thereunder. This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting an instrument or causing any instrument to be drafted. The Statements of Work referred to herein shall be construed with, and as an integral part of, this Agreement to the same extent as if they were set forth verbatim herein. The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.
11.8 Integration. This Agreement, together with all Statements of Work and any other documents incorporated herein by reference, constitutes the sole and entire agreement of the Parties to this Agreement with respect to the subject matter contained herein, and supersedes all prior and contemporaneous understandings and agreements, both written and oral, with respect to such subject matter. In the event of any conflict between the terms and provisions of this Agreement and those of any Statement of Work, the following order of precedence shall govern: (a) first, any Statement of Work, and (b) second, the body of this Agreement.
11.9 Assignment. Neither Party may assign, transfer or delegate any or all of its rights or obligations under this Agreement, without the prior written consent of the other Party; provided, that, upon prior written notice to the other Party, either party may assign the Agreement to a successor of all or substantially all of the assets of such party through merger, reorganization, consolidation or acquisition. No assignment shall relieve the assigning Party of any of its obligations hereunder. Any attempted assignment, transfer or other conveyance in violation of the foregoing shall be null and void. This Agreement shall be binding upon and shall inure to the benefit of the Parties hereto and their respective successors and permitted assigns. This Agreement is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person any legal or equitable right, benefit or remedy of any nature whatsoever, under or by reason of this Agreement.
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11.10 Amendments and Waiver. This Agreement may only be amended, modified or supplemented by an agreement in writing signed by each Party hereto. No waiver by any Party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the Party so waiving. Except as otherwise set forth in this Agreement, no failure to exercise, or delay in exercising, any rights, remedy, power or privilege arising from this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.
11.11 Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of California without giving effect to any choice or conflict of law provision or rule (whether of the State of California or any other jurisdiction) that would cause the application of Laws of any jurisdiction other than those of the State of California. Any legal suit, action or proceeding arising out of or related to this Agreement or the Services provided hereunder shall be instituted exclusively in the federal courts of the United States or the courts of the State of California in each case located in the city and county of San Francisco, and each Party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action or proceeding. Service of process, summons, notice or other document by mail to such Partys address set forth herein shall be effective service of process for any suit, action or other proceeding brought in any such court. Each Party irrevocably and unconditionally waives any right it may have to a trial by jury in respect of any legal action arising out of or relating to this Agreement or the transactions contemplated hereby.
11.12 Equitable Relief. Each Party acknowledges that a breach by a party of Section 6 may cause the non-breaching Party irreparable damages, for which an award of damages would not be adequate compensation and agrees that, in the event of such breach or threatened breach, the non-breaching Party will be entitled to seek equitable relief, including a restraining order, injunctive relief, specific performance and any other relief that may be available from any court, in addition to any other remedy to which the non-breaching Party may be entitled at law or in equity. Such remedies shall not be deemed to be exclusive but shall be in addition to all other remedies available at law or in equity, subject to any express exclusions or limitations in this Agreement to the contrary.
11.13 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date first above written.
VISTA CONSULTING GROUP
/s/ David M. Post |
CVENT, INC.
/s/ Rajeev K. Aggarwal |
|||
By: David M. Post Title: President
Date: 8/8/17 |
By: Rajeev K. Aggarwal Title: Chief Executive Officer and President
Date: November 29, 2016 |
Exhibit 10.21
PAPAY TOPCO, INC.
LONG-TERM INCENTIVE PLAN
May 26, 2017
1. Purpose of Plan. This Long-Term Incentive Plan (the Plan) of Papay Topco, Inc., a Delaware corporation and indirect parent of Cvent, Inc. (the Company), is designed to provide Incentives to such present and future employees, directors, officers, or managers of the Company or its Subsidiaries (Participants), as may be selected in the sole discretion of the Board, through the grant of Incentives by the Company to Participants.
2. Definitions. Certain terms used in this Plan have the meanings set forth below:
Asset Sale means any sale or transfer by the Company and its Subsidiaries of all or substantially all (as defined in the Revised Model Business Corporation Act) of their assets on a consolidated basis.
Board means the Companys board of directors.
Code means the Internal Revenue Code of 1986, as amended, and the regulations promulgated thereunder, as the same may be amended from time to time.
Incentive shall have the meaning set forth in Section 3(a) hereof.
Investors means Vista Equity Partners Fund VI, L.P. arid any affiliate or designee of the foregoing.
Investor Funds means Vista Equity Partners Fund VI, L.P., Vista Equity Partners Fund VI-A, L.P. and VEPF FAF VI, L.P., and any of such funds respective portfolio companies (excluding the Company and its Subsidiaries), and their respective partners, members, directors, employees, stockholders, agents, any successor by operation of law (including by merger) of any such Person, and any entity that acquires all or substantially all of the assets of any such Person in a single transaction or series of related transactions.
Person means an individual, a partnership, a corporation, a limited liability company, an association, a joint share company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.
Residual Equity Value shall mean, following a Qualified Event, the fair market value, as determined by the Board acting in good faith, of the Investor Funds (i) residual equity interest in the Company and its Subsidiaries (if any) and (ii) any other equity interests (whether or not marketable) received by the Investor Funds as consideration for such Investor Funds equity interests in the Company and its Subsidiaries.
Qualified Event shall mean any sale or transfer to any third party of at least 50% of the Investor Funds equity interests (whether by merger, combination or otherwise), other than to the VEP Group, and excluding, for the avoidance of doubt, a Sale of the Company.
Sale of the Company means the earlier of (i) the first date on which the Investors no longer hold any equity securities of the Company and no longer hold any equity interest received in respect of any such equity securities held or previously held by the Investors or (ii) any Asset Sale.
Subsidiary means any corporation or other entity of which the securities or other ownership interests having the voting power to elect a majority of the board of directors or other governing body are, at the time of determination, owned by the Company, directly or through one or more Subsidiaries.
Total Equity Return Multiple shall be determined by the Board acting in good faith and shall mean the quotient of (i) the cumulative total of all cash distributions actually made to, or other cash proceeds actually received by, the Investor Funds (excluding management or transaction fees and expenses, payments pursuant to all incentive plans (equity or otherwise), any other advisory fees and expenses, any board fees and expenses or any other expenses but including, for the avoidance of doubt, all carried interest) in respect of its ownership of equity or debt securities of the Company or any of its Subsidiaries and any loans provided by the Investor Funds during the life of the Investor Funds investment period (the Investor Funds Proceeds), divided by (ii) the Investor Funds total investment in the Company and its Subsidiaries (whether in exchange for equity, indebtedness or otherwise) (the Investor Funds Investments). For purposes of calculating the Total Equity Return Multiple, all distributions made to the Investor Funds will be net of all accrued but unpaid management fees, all expenses associated with the Sale of the Company and assuming, for purposes of the calculation made pursuant to clause (i) above, the vesting (and exercise, if applicable) (prior to the calculation of the Total Equity Return Multiple) of all outstanding options, warrants and other outstanding rights to acquire capital stock of the Company.
VEP Group means Vista Equity partners, its affiliates and any of their respective managed investment funds and portfolio companies (including Vista Equity Partners Fund VI, L.P., Vista Equity Partners Fund VI-A, L.P. and VEPF FAF VI, L.P., but excluding the Company and its Subsidiaries) and their respective partners, members, directors, managers, employees, stockholders, agents, any successor by operation of law (including by merger or otherwise) of any such Person, and any entity that acquires all or substantially all of the assets of any such Person in a single transaction or series of related transactions.
3. Incentive.
(a) Grant. The Board shall have the power and authority to grant to any Participant an incentive (the Incentive) to receive a cash payment upon a Sale of the Company, as of (and contingent upon) the completion of a Sale of the Company, or upon any such additional event as determined by the Board. Unless otherwise provided in a written agreement between a Participant and the Company, no payment in respect of any Incentive shall be made in the absence of a Sale of the Company. Incentives are not intended to be, and shall not be construed as, an option to acquire equity interests in the Company. In addition, the grant of any Incentives will not entitle Participant to any voting rights or other indicia of actual equity ownership. Nothing in this Plan shall interfere with or limit in any way the right of the Company to terminate Participants employment at any time (with or without cause), nor confer upon Participant any right to continue in the employ of the Company for any period of time or to continue employment at any specific rate of compensation.
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(b) Taxes. The Company shall be entitled to deduct or withhold from any amounts owing from the Company under this Plan (and, to the extent not paid directly by Participant to the applicable taxing authority, Participant shall reimburse the Company for any required amount not so withheld for) any federal, state, local or foreign withholding taxes, excise tax, or employment taxes that are required to be withheld by the Company and imposed with respect to payments from the Company pursuant to this Plan.
4. Administration of the Plan. The Board shall have the power and authority to prescribe, amend and rescind rules and procedures governing the administration of this Plan, including, but not limited to the full power and authority (i) to interpret the terms of this Plan, the terms of any Incentives granted under this Plan and the rules and procedures established by the Board governing any such Incentives, (ii) to determine the rights of any person under this Plan or the meaning of requirements imposed by the terms of this Plan or any rule or procedure established by the Board, (iii) to correct any defect or omission or reconcile any inconsistency in the Plan or in any written agreement between the Company and a Participant evidencing the grant of any Incentive hereunder, (iv) to update the schedule accompanying any written agreement between the Company and the Participant and (v) to make all other determinations and take all other actions necessary or advisable for the implementation and administration of the Plan. Each action of the Board shall be conclusively binding on all persons. It is the Companys intent that the Incentives be treated as exempt from, or compliant with, Section 409A of the Code or the regulations thereunder as amended from time to time. In the event the Internal Revenue Service or Treasury Department issues additional guidance interpreting Section 409A of the Code, the Board may modify the terms of any such previously issued Incentive to the extent the Board determines that such modification is necessary to comply with the requirements of Section 409A of the Code. For purposes of Section 409A of the Code, a Participants right, if any, to receive any installment payments pursuant to this Plan shall be treated as a right to receive a series of separate and distinct payments. Notwithstanding the foregoing, in no event whatsoever shall the Company or any of its affiliates be liable for any additional tax, interest, income inclusion or other penalty that may be imposed on a Participant by Code Section 409A or for damages for failing to comply with Code Section 409A.
5. Term and Amendment. The Board at any time may suspend or terminate this Plan and make such additions or amendments as it deems advisable under this Plan; provided, however, that, subject to the other provisions hereof (which shall govern), the Board may not change any of the material terms of a written agreement with respect to an Incentive in a manner which would have a material adverse effect on the Participant without the approval of the holder of such Incentive. This Plan and all Incentives granted hereunder shall expire and terminate automatically upon the earliest to occur of (A) a Sale of the Company and (B) November 29, 2023, and no Incentive may be granted thereafter under this Plan.
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6. Participant Acknowledgements. In connection with the grant of any Incentives pursuant to this Plan, each Participant acknowledges and agrees (as a condition to the effectiveness of any Incentives) that: (i) the Company will have no duty or obligation to disclose to any Participant, and no Participant will have any right to be advised of, any material information egarding the Company or its Subsidiaries at any time; (ii) neither the grant of any Incentive nor any provision contained in this Plan or in any written agreement evidencing the grant of any Incentive shall entitle such Participant to remain in the employment of the Company or its Subsidiaries or affect the right of the Company to terminate any Participants employment at any time for any reason; (iii) such Participant will have consulted, or will have had an opportunity to consult with, independent legal counsel regarding his or her rights and obligations under this Plan and any written agreement evidencing any grant of any Incentive and he or she fully understands the terms and conditions contained herein and therein; and (iv) the effective date of this Plan shall be the date first listed above, and this Plan supersedes any other agreement, arrangement or plan covering the subject matter hereof.
7. Termination.
(a) Subject to Section 7(b) below, if a Participant is no longer employed (or in the case of a Participant who was not an employee, the date on which such Participant is no longer acting as a director, manager or officer of the Company or any of its Subsidiaries) by the Company or its Subsidiaries for any reason prior to the earlier to occur of a Qualified Event and a Sale of the Company, all Incentives granted to such Participant will be immediately forfeited and automatically cancelled (without any action required by the Board, the Company or otherwise); provided that, for the avoidance of doubt, if, while the Participant remains an employee of the Company in good standing, a Qualified Event occurs prior to a Sale of the Company, Participants Incentive shall vest in full upon the consummation of such Qualified Event and Participant shall be entitled to the remainder of Participants Incentive (if any) in the event that a Sale of the Company occurs prior to the termination of the Plan (whether or not Participant is employed by, or serving as a director, manager or officer of, the Company upon the consummation of such Sale of the Company).
(b) In the event of an Asset Sale, for purposes of Section 7(a) only, the Participants employment shall not be deemed terminated if both immediately before and subsequent to the consummation of any such Asset Sale, the Participant is employed by the Company, and/or any of its Subsidiaries and/or any successor to the Company or its Subsidiaries.
8. Restrictions on Transfer. Incentives are personal to Participant and no Participant may sell, transfer, assign, pledge, encumber or otherwise transfer any interest (legal or beneficial) in any Incentives (whether directly or indirectly, whether with or without consideration and whether voluntarily or involuntarily or by operation of law). Any transfer or attempted transfer of any Incentive in violation of any provision of this Plan shall be null and void.
9. Severability. Whenever possible, each provision of this Plan will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Plan is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or any other jurisdiction, but this Plan will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.
10. Business Days. If any time period for giving notice or taking action hereunder expires on a day which is a Saturday, Sunday or holiday in the state in which the Companys chief executive office is located, the time period shall be automatically extended to the business day immediately following such Saturday, Sunday or holiday.
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11. Governing Law. All issues concerning this Plan will be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to any choice of law or conflict of law provision of rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the law of any jurisdiction other than the State of Delaware. Each of the Company and each Participant submits to the non-exclusive jurisdiction of the United States District Court and any Delaware state court sitting in Wilmington, Delaware over any lawsuit under this Plan and waives any objection based on venue or forum non conveniens with respect to any action instituted therein. Each of the Company and each Participant waives the necessity for personal service of any and all process upon it and consents that all such service of process may be made by registered or certified mail (return receipt requested), in each case directed to such party in accordance with the notice requirements set forth in this Plan, and service so made will be deemed to be completed on the date of actual receipt. Each of the Company and each Participant consents to service of process as aforesaid. Nothing in this Plan will prohibit personal service in lieu of the service by mail.
12. Notices. Any notice required or permitted under this Plan or any agreement executed and delivered in connection with this Plan shall be in writing and shall be either personally delivered, or mailed by first class mail, return receipt requested, to any Participant at the address indicated in the Companys records for such Person, and to the Company at the address below indicated:
Notices to the Company: | And with a copy to: | |
Cvent, Inc. | Kirkland & Ellis LLP | |
1765 Greensboro Station Place | 555 California Street, Suite 2700 | |
7th Floor | San Francisco, CA 94104 | |
Tysons Corner, VA 22102 | Attention: Stuart E. Casillas, P.C. | |
Attention: General Counsel |
or such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party. Any notice under this Plan shall be deemed to have been given when so delivered or mailed.
* * * * *
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Exhibit 21.1
LIST OF SUBSIDIARIES
Entity | Jurisdiction | |
Redwood Opportunity Merger Sub, Inc. |
Delaware | |
Redwood Merger Sub LLC |
Delaware |
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the use in this Prospectus constituting a part of this Registration Statement on Amendment No. 1 to Form S-4 of our report dated March 31, 2021, relating to the financial statements of Dragoneer Growth Opportunities Corp. II, which is contained in that Registration Statement. We also consent to the reference to our Firm under the caption Experts in the Prospectus.
/s/ WithumSmith+Brown, PC
New York, New York
September 29, 2021
Exhibit 23.2
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the use in this Registration Statement on Form S-4 of Dragoneer Growth Opportunities Corp. II of our report dated, August 20, 2021 relating to the financial statements of Papay Topco, Inc., which appears in this Registration Statement. We also consent to the reference to us under the heading Experts in such Registration Statement.
/s/ Pricewaterhouse Coopers LLP |
Washington, District of Columbia September 29, 2021 |
Exhibit 23.4
Date: September 29, 2021
Cvent, Inc.
1765 Greensboro Station Place, 7th Floor
Tysons Corner, VA 22102
Dear Sirs or Madams:
We, Frost & Sullivan of 3211 Scott Blvd, #203, Santa Clara, California, 95054, hereby consent to the filing with the Securities and Exchange Commission of a Registration Statement on Form S-4 (the S-4), and any amendments thereto, of Cvent, and any related prospectuses of (i) our name and all references thereto, (ii) all references to our preparation of an independent overview of the Hospitality Cloud GLOBAL TAM 2021/2022, April 2021 and the Events Technology GLOBAL TAM 2021/2022, April 2021 (the Industry Reports), and (iii) the statement(s) set out in the Schedule hereto. We also hereby consent to the filing of this letter as an exhibit to the S-4.
We further consent to the reference to our firm, under the caption Market and Industry Data in the S-4, as acting in the capacity of an expert in relation to the preparation of the Industry Reports and the matters discussed therein.
Regards,
/s/ Dan Colquhoun
Name: Dan Colquhoun
Designation: Senior Vice President
For and on behalf of
Frost & Sullivan
EXHIBIT
MARKET AND INDUSTRY DATA
Unless otherwise indicated, information in this proxy statement/prospectus/consent solicitation concerning economic conditions, Cvent and New Cvents industry, their markets and their competitive position is based on a variety of sources, including information from independent industry analysts and publications, as well as Cvents own estimates and research. This information involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. While Cvent believes the information presented in this proxy statement/prospectus/consent solicitation is generally reliable, forecasts, assumptions, expectations, beliefs, estimates and projects involve risk and uncertainties and are subject to change based on various factors, including those described under Forward-Looking Statements and Risk Factors.
Certain information in the text of this proxy statement/prospectus/consent solicitation is contained in independent industry publications. The sources of these independent industry publications are provided below:
|
Forrester, Cvent Thought Leadership Study: Data Review, February 22, 2021, which was commissioned by Cvent; |
|
Frost & Sullivan, Hospitality Cloud GLOBAL TAM 2021/2022, April 2021, which was commissioned by Cvent; and |
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Frost & Sullivan, Events Technology GLOBAL TAM 2021/2022, April 2021, which was commissioned by Cvent. |
Cvent has not had this information verified by any independent sources. The independent industry publications used in this proxy statement/prospectus/consent solicitation were not prepared on Cvents behalf.
Meetings and events are prevalent in organizations of almost every size, industry vertical and geography. The meetings and events space encompasses a broad spectrum of external marketing events, such as customer events, conferences, trade shows and prospect meetings; and internal events, such as sales kick-offs, training seminars, board meetings and companywide gatherings. Enterprises spend an average of 1% to 3% of their revenue on meetings and events, according to 2014 data from BTN Group. Collectively, organizations spent $1 trillion on meetings and events globally in 2018, according to the Industry and Events Council. According to Frost & Sullivan, the total market opportunity (TAM) for Cvents platform is $29.7 billion, across Cvents Event Cloud and Hospitality Cloud solutions. See Information about CventOur Market Opportunity for a discussion of what is included in Cvents TAM.
Meetings and events are prevalent in organizations of almost every size, industry vertical and geography. The meetings and events space encompasses a broad spectrum of external marketing events, such as customer events, conferences, trade shows and prospect meetings; and internal events, such as sales kick-offs, training seminars, board meetings and companywide gatherings. Enterprises spend an average of 1% to 3% of their revenue on meetings and events, according to 2014 data from BTN Group. Collectively, organizations spent $1 trillion on meetings and events globally in 2018, according to the Industry and Events Council. According to Frost & Sullivan, the TAM for our platform is $29.7 billion, across our Event Cloud and Hospitality Cloud solutions. See Our Market Opportunity for a discussion of what is included in our TAM.
Our Market Opportunity
Meetings and events represent one of the most effective ways for organizations to engage, educate and motivate their target audiences. This value proposition is why meetings and events are often regarded as some of the most effective and best funded marketing strategies, and why they are critical to effective internal employee engagement.
While meetings and events have always been important, the accelerated digital transformation of the events industry driven by the global COVID-19 pandemic has given rise to a new events landscape where a combination of virtual, in-person and hybrid events will proliferate in the marketplace. In this new landscape, organizations are able to reach larger audiences, engage with greater frequency and deliver differentiated experiences. Event technology will be critical to engaging with event attendees and managing all processes needed to plan, promote and execute events across a Total Event Program and to providing a single system of record for all event data.
Our platform delivers a single system of record for organizations to manage their Total Event Program, regardless of venuein-person, virtual or hybridand regardless of audienceinternal or external. Our platform enables customers to not only drive engagement, increase efficiency and scale their Total Event Programs, but also to integrate these solutions into their broader engagement and marketing strategy. According to Frost & Sullivan, the TAM for our platform is $29.7 billion, across our Event Cloud and Hospitality cloud solutions.
Cvent Event Cloud. According to Frost & Sullivan, the annual TAM for the Event Cloud is $25.6 billion worldwide. The TAM was calculated by first estimating the total number of organizations that our platform and products address, segmented by size of employee base and organization type, including corporate and non-corporate, based on the 2017 Statistics of U.S. Businesses and 2020 U.S. Census Data. Addressability assumptions were then applied by segment and band based on our experience in the market. An estimated annual value was then applied to each band of organizations based on survey responses related to spend on event technology.
The total number of companies within each band was then multiplied by the calculated annual value for that band. The aggregate calculated value represents the current annual estimated market opportunity of $14.1 billion and $11.5 billion in the United States and Rest of World, respectively.
Cvent Hospitality Cloud. According to Frost & Sullivan, the annual TAM for the Hospitality Cloud is $4.1 billion. The TAM is calculated by first estimating the total number of hotels with meeting space, segmented by geography, market tier, and banded by total square footage of meeting space. Addressability assumptions were then applied by segment and product based on our experience in the market. An estimated annual spend was then applied to each band of hotels and venues based on survey responses related to spend on group marketing in digital channels. The total number of hotels and venues within each band was then multiplied by the calculated annual value for that band. The aggregate calculated value represents the current global annual estimated market opportunity of $4.1 billion.
Exhibit 23.5
Forrester Research Inc.
Citation Agreement and Consent
Subject to the terms and conditions set forth herein, Forrester Research, Inc. (Forrester) hereby consents to the quotation by Cvent, Inc. (Requester), in certain materials to be presented to potential financial partners and Form S-4 and Form 8-K which may be filed by Requester with the U.S. Securities and Exchange Commission (the Filing), of the following Forrester information that has been published in print (the Forrester Information):
Quote 1.
Certain information in the text of this proxy statement/prospectus/consent solicitation is contained in independent industry publications. The sources of these independent industry publications are provided below:
|
Forrester Consulting, Cvent Thought Leadership Study: Data Review, February 22, 2021, which was commissioned by Cvent; |
Quote 2.
Meetings and events are regarded as some of the most effective marketing channels for building engagement with customers, employees and members. External events, whether conducted in-person or virtually, are critical to marketing efforts, as they represent opportunities for enterprises to directly engage with their most important external audiences. Events offer a highly effective way for organizations to maximize engagement throughout the customer journey, helping them to generate and qualify leads, deepen relationships with customers and build brand loyalty and advocacy. According to Forrester, 74% of respondents considered events to be their most important demand generation tactic. Forrester also estimates that events in total comprise approximately 24% of the average organizations business-to-business, or B2B, marketing program budget. In addition, internal events aid in employee retention and development, as they offer critical opportunities for HR, training professionals and executive leadership to inspire and motivate their employees through engaging experiences.
Quote 3
Increased Importance of Meetings and Events to Chief Marketing Officers During and After the Pandemic.
Meetings and events offer opportunities for enterprises to engage directly with their customers for extended periods of time, and as a result, can represent some of the most effective and highest value touchpoints along the entire customer journey. With the growth in virtual and hybrid events, the opportunities to use events to directly engage with a larger audience has grown significantly. Marquee events such as user conferences and tradeshows present companies with significant marketing and sales opportunities, providing a forum to engage with hundreds or thousands of their prospects, customers and partners in attendance. As a result, meetings and events can represent one of the enterprises most influential marketing channels. According to Forrester, 74% of respondents considered events to be their most important demand generation tactic.
Due to their importance to the customer journey, meetings and events can be a significant component of the marketing efforts for any organization. Forrester also estimates that events in total comprise approximately 24%of the average organizations business-to-business, or B2B, marketing program budget. Given the significance of the associated spend, the ability of events to generate engagement to showcase buyer interests, and events expected direct impact on sales pipeline, we believe that chief marketing officers and other C-suite executives will have a heightened interest in their success and effectiveness.
In consideration of Forresters consent as set forth above, Requester hereby agrees that:
(1) |
the Forrester Information will be presented in the Filing as representing data, research opinion or viewpoints published by Forrester and not as a representation of fact; |
(2) |
Forrester disclaims all warranties, express or implied, statutory or otherwise, including without limitation any implied warranties of merchantability or fitness for a particular purpose, and warranties as to accuracy, completeness or accuracy of the Forrester Information; |
(3) |
the Forrester Information speaks as of its original publication date (and not as of the date of the Filing) and that the opinions expressed in the Forrester Information are subject to change without notice; |
(4) |
Forrester shall have no liability for errors, omissions or inadequacies in the Forrester Information or for any interpretations of the Forrester Information; |
(5) |
Forrester does not assume responsibility for any third parties reliance on any information contained in the Filing, including the Forrester Information; and |
(6) |
Where applicable, Forrester is not an expert within the meaning of Section 509 of Regulation S- K promulgated under the Securities Exchange Act of 1934, as amended. |
Requester agrees to indemnify and hold harmless Forrester, and its directors, officers, shareholders, employees and agents, from and against any and all claims, liabilities, demands, causes of action, damages, losses and expenses (including reasonable attorneys fees and costs) arising, directly or indirectly, and without limitation, out of or in connection with the Filing.
Forresters consent set forth above shall not be deemed effective until Forrester shall have received a countersigned copy of this document from Requester.
Cvent, Inc. |
Forrester Research, Inc. |
|
By: /s/ Michael Dietrich | By: /s/ Naomi Sager | |
Name: Michael Dietrich | Name: Naomi Sager | |
Title: Vice President, Marketing | Title: Manager, Citations | |
Date: September 28, 2021 | Date: 9/28/21 |
Exhibit 24.1
SIGNATURES
Pursuant to the requirements of the Securities Act, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of San Francisco, State of California on the 13th day of September, 2021.
DRAGONEER GROWTH OPPORTUNITIES CORP. II | ||
By: | /s/ Marc Stad | |
Name: Marc Stad | ||
Title: Chief Executive Officer and Chairman of the Board of Directors |
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes an appoints each of Marc Stad and Pat Robertson, his or her true and lawful attorney-in-fact, with power and substitute and resubstituting for him or her and in his or her name, place and stead, in any and all capacities to sign any and all amendments including post-effective amendments to this registration statement, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the SEC, hereby ratifying and confirming all that said attorney-in-fact or his or her substitute, each acting alone, may lawfully do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement has been signed below by the following persons in the capacities and on the dates indicated.
NAME |
POSITION |
DATE |
||
/s/ Marc Stad Marc Stad |
Chief Executive Officer and Chairman of the Board of Directors (Principal Executive Officer) | September 13, 2021 | ||
/s/ Pat Robertson Pat Robertson |
President, Chief Operating Officer and Director (Principal Financial Officer and Principal Accounting Officer) | September 13, 2021 | ||
/s/ Sarah J. Friar Sarah J. Friar |
Director | September 13, 2021 | ||
/s/ David D. Ossip David D. Ossip |
Director | September 13, 2021 | ||
/s/ Gokul Rajaram Gokul Rajaram |
Director | September 13, 2021 | ||
/s/ Jay Simons Jay Simons |
Director | September 13, 2021 |
Exhibit 99.1
Consent of Person to be Named as Director
Pursuant to Rule 438 under the Securities Act of 1933, as amended, the undersigned hereby consents to being named in the proxy statement/prospectus on Form S-4 of Dragoneer Growth Opportunities Corp. II (the proxy statement/prospectus), as filed with the U.S. Securities and Exchange Commission, as may be amended from time to time, as a nominee to the board of directors of New Cvent (as defined in the proxy statement/prospectus). The undersigned also consents to the filing of this consent as an exhibit to such proxy statement/prospectus and any amendments thereto.
/s/ Rajeev Aggarwal |
||
Name: | Rajeev Aggarwal | |
Dated: | September 29, 2021 |
Exhibit 99.2
Consent of Person to be Named as Director
Pursuant to Rule 438 under the Securities Act of 1933, as amended, the undersigned hereby consents to being named in the proxy statement/prospectus on Form S-4 of Dragoneer Growth Opportunities Corp. II (the proxy statement/prospectus), as filed with the U.S. Securities and Exchange Commission, as may be amended from time to time, as a nominee to the board of directors of New Cvent (as defined in the proxy statement/prospectus). The undersigned also consents to the filing of this consent as an exhibit to such proxy statement/prospectus and any amendments thereto.
/s/ Betty Hung |
||
Name: | Betty Hung | |
Dated: | September 29, 2021 |
Exhibit 99.3
Consent of Person to be Named as Director
Pursuant to Rule 438 under the Securities Act of 1933, as amended, the undersigned hereby consents to being named in the proxy statement/prospectus on Form S-4 of Dragoneer Growth Opportunities Corp. II (the proxy statement/prospectus), as filed with the U.S. Securities and Exchange Commission, as may be amended from time to time, as a nominee to the board of directors of New Cvent (as defined in the proxy statement/prospectus). The undersigned also consents to the filing of this consent as an exhibit to such proxy statement/prospectus and any amendments thereto.
/s/ Maneet Saroya |
||
Name: | Maneet Saroya | |
Dated: | September 29, 2021 |