UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 UNDER

THE SECURITIES EXCHANGE ACT OF 1934

For the month of September, 2017

Commission File Number: 001-38049

Azul S.A.

(Name of Registrant)

 

Edifício Jatobá, 8th floor, Castelo Branco Office Park

Avenida Marcos Penteado de Ulhôa Rodrigues, 939

Tamboré, Barueri, São Paulo, SP 06460-040, Brazil.

+55 (11) 4831 2880

 (Address of Principal Executive Office)

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F x                        Form 40-F 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes                      No  x

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes                      No  x

 

 

 

 

Azul Announces Execution of Post-IPO Shareholders ’  Agreement

S ã o Paulo, Sep 4, 2017  –  Azul S.A.,  “ Azul ” , (B3: AZUL4, NYSE: AZUL) announces today the execution of a new shareholders ’  agreement among David Gary Neeleman, Trip Participa çõ es S.A., Trip Investimentos Ltda., Rio Novo Loca çõ es Ltda. (Trip Participa çõ es S.A., Trip Investimentos Ltda. and Rio Novo Loca çõ es Ltda, collectively, the “ TRIP former shareholders ” , and together with Mr. Neeleman, the “ Principal Common Shareholders ” ), CALFINCO, Inc. ( “ CALFINCO ” ) and   Hainan Airlines Co., Ltd. ( “ Hainan ” , and together with CALFINCO, the “ Principal Preferred Shareholders ” ) dated as of September 1, 2017   (the “ Post-IPO Shareholders ’ Agreement ” ), which new agreement has been contemplated by that certain investment agreement by and between Azul, the Principal Common Shareholders and the Principal Preferred Shareholders, as amended, most recently on August   3, 2016 (the “ Investment Agreement ” ).

The Post-IPO Shareholders ’ Agreement has been entered   into to grant the Principal Common Shareholders and the Principal Preferred Shareholders certain   rights as contemplated in the Investment   Agreement, including: (i) the right of the TRIP former shareholders, so long as such shareholders own at least 5% of Azul ’ s common shares   outstanding, to approve any amendment to Azul ’ s by laws that   adversely   affects the rights of the TRIP former   shareholders by   affirmative approval of not less than a majority of the affected TRIP former shareholders; (ii) various provisions governing the Principal Common Shareholders ’ and the Principal Preferred Shareholders ’ rights with respect to elections to the board of directors, including (a) the right of the TRIP former shareholders to appoint three directors so long as such shareholders own at least 20% of Azul ’ s common shares   outstanding, two directors so long as such shareholders own at least 10% of Azul ’ s common shares   outstanding, and one director so long as such shareholders own at least 5% of Azul ’ s common shares   outstanding, (b) the right of CALFINCO to appoint at least one director so long as it owns at least 50% of Azul ’ s preferred shares outstanding resulting from the conversion of Class C preferred shares that were held as of August 3, 2016, (c) the right of Hainan to appoint three directors so long as it holds at least 20% of an economic interest in Azul, two directors so long as it holds at least 10% of an economic interest in Azul, and one director so long as it holds at least 5% of an economic interest in Azul, and (d) Mr. Neeleman ’ s right to appoint the remaining directors so long as TRIP ’ s former shareholders have the right to elect one or more directors pursuant to the above and subject to CALFINCO and Hainan ’ s right to appoint directors pursuant to the above; and (iii) certain restrictions on transfers of shares by the Principal Common Shareholders and the Principal Preferred Shareholders. The Post-IPO Shareholders ’ Agreement replaces that certain Fifth Amended and Restated Shareholders ’ Agreement dated as of August 3, 2016.

The Post-IPO Shareholders ’ Agreement is attached hereto.                                                     

 

About Azul

Azul (B3: AZUL4, NYSE: AZUL), the largest airline in Brazil by number of cities served, offers 739 daily flights to 102 destinations. With a fleet of 123 aircraft and more than 10,000 crewmembers, the company has a network of 202 non-stop routes as of June 30, 2017. Among other awards, Azul was named third best airline in the world by TripAdvisor Travelers' Choice in 2017, best low cost carrier in South America for the seventh consecutive time by Skytrax in 2017, and was also considered the best regional leader in 2016 by Flight Airline Business. For more information visit www.voeazul.com.br/ir .

 

 

Contact

Investor Relations

Tel: +55 11 4831 2880

invest@voeazul.com.br

 

 

 

 

Shareholders’ Agreement

by and among

TRIP Participações S.A.,

TRIP Investimentos Ltda.,

Rio Novo Locações Ltda.,

CALFINCO Inc.

Hainan Airlines Co., Ltd.

and

David Gary Neeleman

and as intervening and consenting party,

AZUL S.A.

______________________

Dated September 1 ^st , 2017

______________________

 

 

 

 

 

 

 

 

                                                                                     

 

Shareholders’ Agreement

This Shareholders Agreement (“ Agreement ”) is entered into by and among the following parties:

By and among,

(a) TRIP Participações S.A . , a corporation, with head office in the City of Cariacica, State of Espirito Santo, at Rodovia BR 262, Km 05, Campo Grande, CEP 29.145-901, registered as taxpayer under CNPJ/MF No. 09.229.532/0001-70, herein represented by its undersigned legal representatives (“ TRIP Participações ”);

(b) TRIP Investimentos Ltda . , a limited liability company, with head office in the City of Cariacica, State of Espírito Santo, at Rodovia BR 262, Km 05, Campo Grande, CEP 29145-901, registered as taxpayer under CNPJ/MF No. 15.300.240/0001-89, herein represented by its undersigned legal representatives (“ TRIP Investimentos ”);

(c) Rio Novo Locações Ltda ., a limited liability company with head office in the City of Cariacica, State of Espirito Santo, at Rodovia BR 262, Km 6,3, Sala 208,, CEP 29.157-405, registered as taxpayer under CNPJ/MF No. 04.373.710/0001-18, herein represented by its undersigned legal representatives (“ Rio Novo ” and, together with TRIP Participações and TRIP Investimentos, the “ TRIP’s Shareholders ”);

(d) CALFINCO, Inc. (“ Calfinco ”), a corporation organized under the laws of the State of Delaware, United States of America, having its principal place of business at 233 South Wacker Dr, Chicago, IL 60606;

(e) Hainan Airlines Co., Ltd. , a limited company organized and existing under the laws of the People’s Republic of China, with its headquarters in the Haikou City, Hainan Province, at HNA Plaza, No. 7 Guoxing Road, with the Chinese Company Registration No. 460000400002151, herein represented by its undersigned legal representatives (“ HNA ”); and

(f) David Gary Neeleman , Brazilian, married, bearer of RG no. 53.031.273-6 SSP/SP, registered in the CPF/MF under no. 744573731-68, undersigned (“ Neeleman ” and, together with TRIP’s Shareholders, Calfinco and HNA, “ Shareholders ” or “ Parties ” and each individually a “ Shareholder ” or “ Party ” as appropriate); and

And in the capacity of intervening and consenting party,

(f) AZUL S.A. , a corporation with head office in the City of Barueri, State of São Paulo, at Av. Marcos Penteado de Ulhoa Rodrigues, 939, 8 ^th floor, Condominio Castelo Branco Office Park, Tamboré, Barueri, São Paulo, 06460-060, registered as taxpayer under CNPJ/MF No. 09.305.9994/0001-29, herein represented by its undersigned legal representatives (the “ Company ”),

 

 

Preamble

Whereas on May 25 2012, the TRIP’s Shareholders and Neeleman, among other parties, entered into an Investment Agreement (“ Investment Agreement ”) through which they have established the general process of incorporation of the totality of shares issued by TRIP Linhas Aéreas S.A. (“TRIP”) into the Company, with the subsequent subscription of new shares issued by the Company by the Shareholders of TRIP, with no extinction of TRIP, pursuant to terms of Article 252 of Federal Law No. 6,404 dated December 15, 1976 (as amended from time to time, “ Corporations Law ”) (“ Merger of Shares ”).

Whereas Calfinco and the Company entered into an Investment Agreement, dated as of June 26, 2015 (the “ Calfinco Investment Agreement ”), pursuant to which the Company agreed to issue and Calfinco agreed to subscribe for Class C Preferred Shares which were subsequently mandatorily converted into Preferred Shares in connection with the IPO (as defined below) of the Company.

Whereas HNA and the Company entered into an Investment Agreement, dated as of February 5, 2016 (the “ HNA Investment Agreement ”), pursuant to which the Company agreed to issue and HNA agreed to subscribe for Class D Preferred Shares which were subsequently converted into Preferred Shares.

Whereas the Merger of Shares was effectually executed and formalized as of August 15 2012, and after several adjustment operations in the exchange ratio of shares of the Company, pursuant to the terms of the Investment Agreement, as well as the conversion of several classes of preferred and common shares previously intended for a single class of common and preferred shares, to those currently existing, the Shareholders have become, on this date, holders of the following proportion of Shares of the Company:

 

S h a r e h ol d e r	Co m m on S h a res		Perce n t age of Co m m on S h a res ( %)		Pre f er r ed S h a res		Perce n t age of Pre f er r ed S h a res ( %)
N e e l e m a n	622,406,638		67.0		11,438,402		3.6
T R I P P a r tici p aç õ e s	202,328,712		21.8		21,009,898		6.6
T R I P I nv e s ti m e nt o s	79,705,144		8.6		10,177,930		3.2
Ri o Nov o	24,524,564		2.6		1,925,057		0.6
Ca lf i n co	0		0		12,460,814		3.9
HNA	0		0		72,672,508		22.9
T O T A L	928,965,058		1 0 0 %		129,684,609		40.8

 

 

W HEREAS th e C o m p a n y held its I nit i a l Pu b l i c Off e r in g o f S ha r e s ( “ I PO ” ) , a n d p u r s u a n t t o s e c t i o n 4 . 5 o f t h e I n v e s t m e n t A g r ee m e nt , t h e P a r ti e s ha v e a s s u m e d th e r e c i p ro ca l o b l i g a t i o n t o e nt e r i nt o t hi s A gr ee m e n t fo r th e p u r p o se o f a s s i g n i n g e a c h o f T R I P’ s S ha re h ol d e r s, Ca lfi nc o, HN A and Neeleman c e r ta i n a n d s p e ci fi c r i g ht s, t o t a k e e ff e c t upon c o m p l e ti o n o f th e I PO and which shall supersede for any and all purposes any shareholders agreement entered into by the Shareholders, the Company and any other shareholder in respect of the Shares .

 

 

NOW, THEREFORE , the Shareholders, pursuant to and for the purposes and effects of Article 118 of the Corporations Law, agree to enter into this Agreement, which shall bind the Company, and shall be governed by the following clauses and conditions:

 

S E C T ION I

D EFINED T ERMS AND INTERPRETATION

 

1.1. F o r th e p u r p o s e s o f t hi s A g r ee m e nt :

 

(a) headings and titles shall not limit or affect in any way the interpretation of the text, s e rv in g o n l y fo r c o n v e ni e nc e a n d r e f e r e nc e;

 

( b ) th e t e r ms “ i nc lu d e ” , “ i nc lud in g ” a n d s i m i l a r s ha l l b e in t e r p r e t e d a s i f t h e y w e r e acc o m p a ni e d b y th e ph r a se “ w ith o u t li m i ta t i on ” ;

 

( c ) c a p i ta l i ze d t e r ms s ha l l b e in t e r p r e t e d a n d s ha l l h a v e th e m e a ni n g s e t for t h t h ro u g h ou t t h i s A gr e e m e nt , a n d s ha l l e q u a l l y app l y t o th e s i n g u l a r a n d p l u r a l , m a s cu li n e a n d f e m in i n e ;

 

(d) references to any documents or instruments include all of its addendums, restatements, c o n s ol i d a t i o n s a n d a m e nd m e nt s, e x c e p t a s o th e r w i se e x p r e ss l y p r o v id e d ;

 

( e ) r e f e r e nc e s t o l e g a l p rov i s i o n s s ha l l b e i n t e r p r e t e d a s r e f e r e nc e s t o s u c h p rovi s i o n s a s a l t e r e d , e x t e n d e d , c o n s ol i d at e d o r r e s tat e d , o r a s t h e i r a p p l ic a ti o n i s c h a n g e d fro m ti me t o ti me b y o th e r n or ms, a n d s ha l l i nc lu d e a n y p rov i s i o n s fro m w hi c h th e y o r i g in a t e ( w it h o r w ith o u t a m e n d m e n t s) a n d a n y d e ci s i o n s, r e g u l a t i o n s, i n s t r u m e n t s o r ot h e r l e g a l n or ms s ub ordi nat e d t h e r e t o ;

 

(f) except as otherwise provided, references to Chapters, Sections, Subsections, Items and E x h i b i t s r e f e r t o c h a p t e r s, s e cti o n s , s ub s ec ti o n s, it e ms a n d e x h ib it s a t t a c h e d t o t h i s A gr e e m e n t.

 

F o r th e p u r p o s e s o f t hi s A g r ee m e nt :

 

( a ) “ Aff i l iat e ” s h a l l m e an , ( a ) i n c onn e cti o n t o a l e g a l e ntit y , ( i ) a n y i n di vid ua l o r o th e r e n t i t y h ol din g , d i r e ct l y o r i n di r e ct l y , c o nt ro l o f s u c h e n t i t y , ( ii ) a n y e ntit y C on t roll e d , di r e ct l y o r in d i r e ct l y , b y s uc h p e r s o n , o r ( iii ) an y e nt i t y di r e ct l y o r indi r ec t l y u nd e r c o mm o n C o nt ro l o f s u c h p e r s o n ; a n d ( b ) i n c on n e cti o n t o a n in di vid ua l , ( i ) h i s di r e c t d e s c e nd e n t p rov id e d h e / s h e i s B r a z i li an , ( ii ) a n y e ntity t h at , d i r e ct l y o r indi r ec t l y , i s C on t rol l e d b y th e r e f e r r e d i nd i v i du a l , t h e i n div id u a l’ s s p o u s e , a s c e n d a n t s, d e s c e n d a nt s o r di r ec t r e l ati v e s u p t o th e s e c on d d e gr ee.

 

( b ) “ B y l a w s ” m e an s t h e b y l a w s o f th e C o m p an y ;

 

(c ) “ C o mm on S ha r e s ” m ea n s th e c o m m o n s ha r e s i s s u e d b y th e C o m p a n y ;

 

 

( d ) “ C o nt rol ” m ea n s, s u bj ec t t o th e l e g a l d e f in i ti o n o f c o nt ro l s e t for t h u nd e r A r tic l e 11 6 o f t h e C or p or a t i o n s L a w :  ( a ) t h e p o w e r t o e l e c t a m aj ori t y o f off ic e r s an d t o d e t e r m in e a n d c a rr y o u t t h e p ol ici e s a n d m a n a g e m e n t o f t h e e nt i t y i n q u e s ti on , a lo n e o r t og e th e r w it h ot h e r i n di v i d ua l s in volv e d i n a s ha r e h ol d e r s a gr ee m e n t o r s i m i l a r vo t i n g a gr ee m e n t o r u n d e r c o mm o n c on t r ol , o r ( b ) th e di r e c t o r i n di r e c t o w n e r s hi p o f a t l e a st f i f t y p e r c e n t ( 5 0 %) p l u s o n e ( 1 ) s ha r e / q u o t a o f t o ta l vo t i n g c a p ita l o f t h e e n t it y i n qu e s t i o n .  Te r ms d e r i v e d fro m C o nt rol , s u c h a s “ C on t r ol l e d” , “ C on t rol l e r ” a n d “ u nd e r c o m m o n C o nt rol ” s ha l l ha v e a m e a n in g a na logo u s t o C o nt ro l .

 

( e ) “ I nd e p e nd e n t D i r e ct o r ” s ha l l m e a n th e D i r e ct o r t ha t ( a ) ha s n o c on n e cti o n t o t h e C o m p an y, except for equity interest; ( b ) i s n o t a C on t roll in g s ha r e h ol d e r, s p o u se o r r e l ati v e u p t o th e s e c on d d e gr e e o f th e d i r e ct or , a n d i s n o t , n o r h a s b ee n , fo r t h e th r ee ( 3 ) p r e c e d i n g y e a r s, a n e m p l o y e e o f an y c o m p a n y o r e ntit y r e l at e d t o th e C o nt roll in g s h a r e h ol d e r ( e x c e p t fo r th o se p e r s o n s c o nn ec t e d t o p u b l i c s c h ool s a n d/ o r r e s e a r c h in s t it u t i o n s ) ; ( c ) ha s n o t b ee n , fo r t h e l a st t h r e e ( 3 ) y e a r s, a n e m p l o y e e o r o ff ic e r o f th e C o m p an y, o r o f th e C o nt roll in g s h a r e h ol d e r , o r of an y e nt i t y C o nt roll e d b y th e C o m p a n y ; ( d ) i s n o t a s up p l i e r o r bu y e r , di r e ct l y o r in d i r e ct l y , o f th e C o m p a n y ’ s s e r v ic es a n d/ o r p ro d u ct s , t o t h e e x t e n t t h a t s u c h m a y u n d e r m in e t h e for e go in g’ s ind e p e nd e n c e ; ( e ) i s n o t a n e m p loy ee , off i c e r o r di r e ct o r o f a n y c o m p a n y o r e ntit y t h a t off e r s o r d e m and s s e rv ic e s a nd / o r p rod u c t s fro m /t o t h e C o m p an y, t o t h e e x t e n t t h a t s u c h m a y u n d e r m in e t h e for e go in g’ s ind e p e nd e n c e ; (f ) i s n o t t h e s p o u se o r r e l ati v e u p t o t h e s e c o n d d e gr e e o f an y off ic e r o r di r e ct o r o f th e C o m p a n y ; a n d (g ) d o e s n o t r e c e i v e an y r e m un e r ati o n fro m t h e C o m p a n y , o th e r t h a n t h a t c on n e ct e d t o t h e p o s i t i o n o f di r ec t o r ( e x c e p t fo r i n c o me r e s u l tin g fro m i n t e r e st r i g ht s i n th e s ha r e c a p ita l) .

 

( f ) “ Pr e f e r r ed S ha r e s ” m ea n s all the p r e f e rr e d s ha r e s of the Company, as provided in the Bylaws of the Company (including, for the avoidance of doubts, all different classes of preferred shares existing prior to the IPO that have been converted into a single class of preferred shares);

 

( g ) “ S ub s i d ia r y ” m e an s , i n c on n e c t i o n t o t h e C o m p a n y , th e c o m p a ni e s i n w h i c h t h e C o m p an y e x e r ci s e s C o nt rol ;

 

S E C T ION II

B OUND S HARES AND E XERCISE OF V OTI N G R IGHTS

 

2 . 1. A l l C o mm o n Sh a r e s h e l d b y S ha r e h o l d e r s a n d a l l Pr e f e r r e d S ha r e s h e l d b y S ha r e h ol d e r s s ha l l b e b ou n d t o t h i s A gr e e m e nt.

 

2 . 2   T h e S ha r e h ol d e r s a r e b oun d t o e x e r c i se th e i r vo t i n g r i gh t p e r t a i n in g t o t h e S ha r e s a t t h e G e n e r a l M ee tin g s o f th e C o m p a n y i n or d e r t o c o m p l y w it h t e r ms a n d c on d i ti o n s h e r e of .

 

S E C T ION III

BYLAWS

 

3 . 1. I n ca se o f c o n fl i c t o r i nc o n s i s t e nc y b e t w e e n t h i s A gr e e m e n t a n d t h e B y l a w s o f th e C o m p a n y , t hi s A gr ee m e n t s h a l l s up e r s e d e , a nd t h e S ha r e h ol d e r s s ha ll , a t th e f i r s t G e n e r a l M ee tin g o f th e C o m p an y t o b e h e l d a f t e r th e i d e n t i fi ca t i o n o f th e c o n fl i c t , w hic h s h a l l b e ca ll e d a n d c o n d u c t e d w i t h i n t h i r t y ( 30 ) d a y s f o l l o w in g th e i d e n t i f i c a t i o n o f th e r e f e r r e d c o n fl ic t , a l t e r t h e w or din g o f t h e B y l a w s i n or d e r t o e l i m i n ate th e i d e n ti f i e d c o n fli ct .  I n th e e v e n t th a t s u c h o c cu r s , a n y S ha r e h ol d e r m a y ca l l a G e n e r a l M ee tin g fo r s u c h pu r p o s e .

 

 

S E C T ION IV

CORPORATE GOVERNANCE

 

 

4.1. Composition of the Board of Directors .  The Company shall be managed by the Board of Directors and by the Management.  The Board of Directors of the Company shall consist of a maximum of fourteen (14) , members and their respective alternates, at least two (2) of the them or twenty percent (20%) of the Board of Directors, whatever is greater, q u a l i f i e d a s I nd e p e nd e n t D i r e ct or s, w it h a u ni f i e d t e r m o f t w o ( 2 ) y e a r s, e l ect e d b y th e G e n e r a l M ee tin g o f th e C o m p a n y , r e e l e cti o n t o b e a ll o w e d .   T h e D i r e ct or s s ha l l h ol d offi c e u n ti l th e e l e cti o n a n d i n v e s ti t u r e o f th e i r a l t e r n a t e s, e x c e p t i n ca se o f r e s ig na t i o n d u ri n g t h e t e r m o f off ic e .

 

 

4 . 2.   Nomination o f D i r e ct or s b y T R I P’ s S ha r e h ol d e r s .

 

( a )   A s lo n g a s T R I P ’ s S ha r e h ol d e r s h old , t og e th e r , a t l e a st t w e nt y p e r c e n t ( 2 0 %) o f t h e C o mm o n S ha r e s, TR I P’ s S ha r e h ol d e r s s ha l l ha v e t h e p r e rog ati v e t o :  ( i ) nominate t h r e e ( 3 ) m e m b e r s o f t h e B o a r d o f D i r e ct or s o f th e C o m p a n y a n d th e i r r e s p e cti v e a l t e rn at e s; ( ii ) nominate an y s u c c e ss or s o f th e m e m b e r s a p p oi nt e d i n s u b p a r a gr a p h ( i ) a b ov e ; a n d ( i i i ) r equire removal f r o m th e B o a r d o f D i r e ct or s o f th e C o m p a n y of an y m e m b e r t h a t T R I P’ s S ha r e h ol d e r s ha v e nominated i n a cc ord a nc e w it h s ub pa r a gr a p h s ( i ) a n d ( ii ) a bov e .

 

(b)  If TRIP’s Shareholders hold, together, at least ten percent (10%) of the Common Shares, but less than twenty percent (20%), TRIP’s Shareholders shall have the prerogative to:  (i) nominate two (2) members of the Board of Directors of the Company and their respective alternates; (ii) nominate any successors of the members appointed in subparagraph (i) above; and (iii) require removal from the Board of Directors of the Company of any member that TRIP’s Shareholders have nominated in accordance with subparagraphs (i) and (ii) above.

 

(c)  If TRIP’s Shareholders hold, together, at least five percent (5%) of the Common Shares, but less than ten percent (10%), TRIP’s Shareholders shall have the prerogative to:  (i) nominate one (1) member of the Board of Directors of the Company and its respective alternate; (ii) nominate any successors of the member appointed in subparagraph (i) above; and (iii) require removal from the Board of Directors of the Company of any member that TRIP’s Shareholders have nominated in accordance with subparagraphs (i) and(ii) above.

 

4.2.1 The persons nominated by TRIP’s Shareholders to hold office on the Board of Directors of the Company and appointed by the General Meeting, pursuant to the terms of Section 4.2 above and Section 4.7 will not necessarily need, as a condition of their office, to qualify as Independent Directors.

 

 

4 . 3. Nomination of Director b y Ca lfi nc o . A s lo n g a s Ca lfi nc o h ol d s a t l e a st f i f t y p e r c e n t ( 5 0 %) o f t h e e q u i v a l e n t nu m b e r o f Pr e f e r r ed S ha r e s i nt o w h i c h t h e C l a ss C Pr e f e r r e d S ha r e s subscribed on J un e 26 , 2 01 5 have been converted into , Ca lfi nc o s ha l l h a v e th e p r e r o g ati v e t o ( a ) nominate o n e ( 1 ) m e m b e r t o t h e B o a r d o f D i r e ct or s, ( b ) nominate an y s u c c e ss or s o f th e m e m b e r a p p oi nt e d i n s u b p a r a gr a p h ( a ) a b ov e ; a n d ( c ) require removal f r om th e B o a r d o f D i r e ct or s o f th e C o m p a n y of an y m e m b e r nominated i n a cc ord a n c e w it h s ub pa r a gr a ph s ( a ) a n d ( b ) a b ov e . Appointment of the Directors nominated by Calfinco, in accordance with this Section 4.3 and Section 4.7, shall be made by the General Meeting.

 

4 . 4.   Nomination o f D i r e ct or s b y HN A .

 

( a ) A s l o n g a s HN A h ol d s a t l e a st a t w e n t y p e r c e n t ( 2 0 %) e c o n o m i c i n t e r e st i n t h e C o m p an y a n d HN A o w n s th e l a rg e st p e r c e nta g e e c o n o m i c i n t e r e st i n t h e C o m p a n y , t a k i n g i nt o a c c ou n t T R I P’ s S ha r e h ol d e r s a s a s i n gl e s ha r e h ol d i n g b lo ck , H N A s ha l l ha v e th e p r e rog ati v e t o : ( i ) nominate t h r e e ( 3 ) m e m b e r s o f th e B o a r d o f D i r e ct or s o f th e C o m p a n y a n d t h e i r r e s p e c t i v e a l t e r nat e s; (i i ) nominate an y s u c c e ss or s o f th e m e m b e r s a pp oin t e d i n s ub pa r a gr a p h ( i ) a b ov e ; a n d (i ii ) require removal f r o m th e B o a r d o f D i r e ct or s o f t h e C o m p an y of a n y m e m b e r th a t HN A ha s nominated i n a cc or d a nc e w i t h s u b pa r a gr a p h s ( i ) a n d ( ii ) a b ov e.

 

(b) If HNA holds at least a ten percent (10%) economic interest in the Company, but less than a twenty percent (20%) economic interest in the Company, HNA shall have the prerogative to:  (i) nominate two (2) members of the Board of Directors of the Company and their respective alternates; (ii) nominate any successors of the members appointed in subparagraph (i) above; and (iii) require removal from the Board of Directors of the Company of any member that HNA has nominated in accordance with subparagraphs (i) and (ii) above.

 

(c)  If HNA holds at least a five percent (5%) economic interest in the Company, but less than a ten percent (10%) economic interest in the Company, HNA shall have the prerogative to: (i) nominate one (1) member of the Board of Directors of the Company and its respective alternate; (ii) nominate any successors of the member appointed in subparagraph (i) above; and (iii) require removal from the Board of Directors of the Company of any member that HNA has nominated in accordance with subparagraphs (i) and (ii) above. In any case, no director nominated by HNA and appointed by the General Meeting, in accordance with this Section 4.4 and Section 4.7, may be a U.S. citizen or resident.

 

4 . 5. Nomination o f D i r e ct or s b y N e e l e m an .  S u b j e c t in any case t o S e c t i o n s 4.2. 4 . 3 , 4 . 4 and 4.5.1, N ee l e m a n h a s th e p r e rog ati v e t o ( a ) nominate th e r e m a i n i n g m e m b e r s o f th e B o a r d o f D i r e ct or s o f th e C o m p a n y a n d th e i r r e s p e cti v e a l t e rn at e s; ( b ) nominate an y s u cc e ss or s o f th e m e m b e r s a p p o i n t e d i n s u b pa r a gr a p h ( a ) a b ov e; a n d ( c ) require removal fro m th e B o a r d o f D i r e ct or s o f th e C o m p a n y of an y m e m b e r s a p p oi nt e d i n a cc ord a n c e w it h s u b p a r a gr aph s ( a ) a n d ( b ) a b ove. Directors nominated by Neeleman, in accordance with this Section 4.5, shall be appointed by the shareholders general meeting and shall qualify as Independent Directors, except if the minimum number of Independent Directors have already been reached pursuant Sections 4.2, 4.3 and 4.4 above or pursuant the exercise by the other holders of Common Shares or Preferred Shares of their rights pursuant to Article 141 of the Corporations Law.

 

 

4 . 5 . 1. I n th e e v e n t t h a t t h e ot h e r h ol d e r s o f C o mm o n S ha r e s o r Pr e f e r r e d S ha r e s e x e r ci se th e i r r i gh t pu r s u a n t t o A r tic l e 1 4 1 o f th e C or p or ati o n s L a w , i t i s a gr ee d t h a t TRIP’s Shareholders, Calfinco and HNA will mandatorily vote in the separate election procedure established pursuant to such Article 141 to tentatively appoint one (1) of its representatives in the Board of Directors, in accordance with Section 4.2, 4.3 and 4.4 above.  If TRIP’s Shareholders Calfinco or HNA are able to appoint one of their representatives in the separate election procedure, this member shall be counted, for all purposes, as part of TRIP’s Shareholders’, Calfinco’s or HNA’s rights, as applicable, to nominate representatives under Sections 4.2, 4.3 and 4.4 above.  For the avoidance of doubt, if TRIP’s Shareholders, Calfinco or HNA are not able to appoint their representatives in the separate election procedure pursuant to Article 141, TRIP’s Shareholders, Calfinco and HNA shall have the right to nominate their representatives to the Board of Directors of the Company in accordance with Sections 4.2, 4.3. and 4.4. hereof, and the number of directors elected by the other holders of Common Shares or Preferred Shares under Article 141 of the Corporations Law shall be deducted from the number of directors that Neeleman has the right to nominate pursuant to Section 4.5. If, after the foregoing procedures, Neeleman is not able to appoint the majority of the Board of Directors, the Parties shall vote in order to increase the maximum number of members of which the Board of Directors is comprised of, so that Neeleman is able to nominate and elect the additional number of members required to reach, at least, the majority of the Board of Directors.

 

4 . 6.   R e s ol uti o n s o f th e G e n e r a l M ee tin g .  E x c e p t fo r m a tt e r s fo r w hi c h t h e h old e r s o f Pr e f e r r e d S ha r e s h ol d th e r i g h t t o vo t e , i n a c c or d a nc e w it h t h e B y l a w s, a l l o th e r d e ci s i o n s o f G e n e r a l M ee tin g s o f t h e C o m p an y s ha l l b e m a d e b y t h e a ff i r m a ti v e vo t e o f h ol d e r s o f a t l e a st th e m aj or it y o f C o mm o n S ha r e s.

 

4 . 6 . 1. No t w ith s t a n d i n g t h e p rov i s i o n s o f S ec ti o n 4 . 5 a b ov e , a s lo n g a s T R I P’ s S ha r e h ol d e r s h ol d , t og e th e r , a t l e a st f i v e p e r c e n t ( 5% ) o f t h e C o mm o n S ha r e s, a n y c h an g e s t o th e B y l a w s o f th e C o m p a n y t h at , b y a m e n d in g t h e it e ms l i s t e d b e l o w , m a y m at e r ia l l y a f f e c t t h e r i gh t s o f T R I P ’ s S ha r e h ol d e r s, s ha l l n e c e ss a r i l y b e app rov e d b y a m aj ori t y o f T R I P ’ s S ha r e h ol d e r s:

 

(a) the quorum required for decisions of the Board of Directors; (b) the powers of the B o a r d o f D i r e ct or s o f th e C o m p a n y ; o r

 

( c ) th e r u l e s fo r ca ll in g , i n s t a ll in g o r r e d u c i n g p o w e r s an d o th e r p rov i s i o n s r e g a r d i n g t h e m ee tin g s o f t h e B o a r d o f Dir e ct or s.

 

4 . 6 . 2. No t w ith s t a n d i n g S e c t i o n 4 . 5 ab ov e , a s lo n g a s T R I P ’ s S ha r e h ol d e r s h ol d a t l e a st f i v e p e r c e n t ( 5 %) o f th e C o mm o n S ha r e s, a n y ch a n g e s t o th e B y l a w s o f th e C o m p a n y tha t c h an g e t h e t ot a l n u m b e r o f di r e ct or s o f t h e C o m p an y ’ s B o a r d o f D i r e ct or s, w hi c h m u s t r e m a i n c o m p o s e d o f fo u r t ee n (1 4 ) m e m b e r s, m u st n e c e ss a r i l y b e a p p rov e d b y a m a j or it y o f T R I P’ s S ha r e h ol d e r s.